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Dr Paul Sissons
Senior Researcher
T 020 7976 3621
Dr Paul Sissons

The shrinking-middle and Good Work

Authors: Dr Paul Sissons Dr Paul Sissons

15 July 2011

The Work Foundation’s mission is all about Good Work. But economic, technological and social change continues to transform the types of jobs we do. These changes in the labour market can influence both our earnings and our ability to progress in work.

In our new report The Hourglass and the Escalator:  Labour market change and mobility we chart changes in the labour market over the past decade – and find evidence that middle-wage jobs are increasingly being hollowed-out. For men there have been significant declines in the numbers employed in factory occupations; for women the biggest losses have been clerical and administrative posts. This ‘shrinking middle‘ creates concern that the labour market is becoming gradually polarised into good and bad jobs.

The pattern of polarisation is more pronounced for men. Growth in the employment share is solely among the top and bottom three occupations when ranked by wage. For women there has been strong professional jobs growth on one hand (supported by rising public sector employment) and growth in personal services on the other. In the early period of recovery these trends persist as jobs continue to be lost in the middle while they grow at the top and bottom.

One of the reasons this matters is because of its potential impact on social mobility. This is a topic that has received significant attention from the Coalition Government, however almost invariably what they are discussing is inter-generational mobility and the damaging effects of inter-generational disadvantage, as young peoples’ futures are strongly influenced by the experiences of their parents. Much less attention has been given to how we might improve social mobility for those already in employment. Yet, as is shown in the report, significant numbers are struggling to move away from the bottom of the earnings distribution. Given that low-wage/low-skilled jobs appear to be an enduring feature of our labour market, this raises important questions about what can be done to boost mobility in work.

There is an emerging body of literature from Canada and the US about what can be done to ‘upgrade’ low-wage service sector work. This work is led by Richard Florida, the Director of the Martin Prosperity institute at the University of Toronto. Part of this upgrading is about improving wages and part about conditions. Florida argues that low-wage service jobs are the ‘last frontier of inefficiency’ and he advocates more service sector firms taking the ‘high-road’ by investing in workers skills to enable them to perform at a higher standard. On wages there are already some good examples to draw on - Florida cites a number of employers who pay comparably well in the States; and in this country we have the Living Wage campaign.

However, we also need to think about in-work progression, and when considering the ability to move-up in work there are a number of strategies which offer the potential for change. These include developing career ladders from low-wage work which offer a clear path upwards for those at the bottom; lifelong learning has also been shown to boost wage returns. There are also a number of other factors that can improve work at both the top and the bottom. My colleague Stephen Bevan, who has recently published the Final Report by the Good Work Commission, sets some of these out - they include greater employee engagement, enabling employees to contribute to decision-making, and demonstrating to employees that there is ‘fairness’ in the workplace.

For obvious reasons the focus of politicians in the last couple of years has been on the quantity of work rather than the characteristics of these jobs. However, perhaps coming out of the deepest recession in living memory we should now begin to take stock about not just the number of jobs, but also the quality of work which they offer. The prize is ‘good work for all’.