Footnote: Unemployment Statistics

Official Figures

At the time of writing, officially 292,000 people between the age of 50 and retire­ment age are unemployed. At this time, retirement age for men is 65 and for wo­men it is 60. I have no way of measuring unemployment myself. I cannot there­fore verify or dispute this figure arithmetically. But I have no doubt that if one adheres strictly to the syntax of the way it is stated then it cannot be other than true.

Nevertheless, this figure does not rest easily with my observation of, and convers­a­tions with, my fellow job club attendees over the past 10 years. Particularly, it does not stack up with the purported success rate of job clubs in getting people back to work. One of the executive job clubs I attended claimed a 70% success rate. This implied that 70% of the club's unemployed intake had found and started a new job at some time before the end of their 6 month memberships. Observation, how­ever, did not bear this out.

The intake at most of the job clubs I have attended has been from 10 to 15 people. By the end of the 6 months 'membership' period about 3 out of the original intake are still attending regularly. The younger ones have always been a minority. Most have been in the 50 to 60 age group. The younger ones have usually found jobs — eventually. Few in the older age bracket end up in jobs. After 10 years I can still count them on one hand.

When I am part of a new intake, I soon think that I have a fairly good idea as to who is serious about trying to find work and who has, to all intents and purposes, given up. Among my age group, the serious ones are in a minority. They are the intrepid 3 who are there at the end of their 6 months membership of the job club. I have always been one of them. One might assume that all but these remaining 3 had, by the end of the 6 months, found a job. But this is not so.

At the end of my 6 month membership of the job club which claimed the 70% suc­cess rate I asked the Leader to name the employers with whom each absent mem­ber of our intake had acquired a job. He named two ex-attendees instead: both in their early 30s. That was a success rate for our intake of 13%. I therefore chal­len­ged his claim that the club had a 70% success rate. He offered no explanation other than that it was what the official figures showed. My client advisor at my local Jobcentre 'confirmed' what this Job Club Leader had said.

In disbelief, I asked my client advisor how this success rate was measured. He told me that 70% of the job club's intake who were "unemployed and claiming benefit" were no longer "unemployed and claiming benefit" at the end of the 6 month per­iod of their 'membership'. This led me to enquire what precisely was meant by "unem­ployed and claiming benefit". What 'benefit'? Does it mean any and all so-called benefits? Or does it solely and specifically refer to Unemployment Benefit?

If it refers exclusively to Unemployment Benefit then both the quoted success rate and the unemployment figures are meaningless. Upon losing his job, an unemploy­ed person starts to receive Unemployment Benefit. He continues to receive this for the next 39 weeks. Then it stops. After having been unemployed for 26 weeks, he is required to start attending a job club. Membership of the job club lasts for 26 weeks. Thus, after 13 weeks in job club his Unemployment Benefit stops. He thus ceases to be "unemployed and claiming benefit". Assuming that the word "and" acts in the true sense of Boolean logic this in no way asserts that he has therefore become employed.

On becoming unemployed an ex-employee usually receives a once-only redundan­cy payment. He may also already have his own savings and investments. He rece­i­ves Unemployment Benefit for 39 weeks unconditionally. However, if his red­und­ancy plus his savings amount to more than £8,000 he will receive no means-tested benefits once his Unemployment Benefit ceases. He will therefore no longer be "unemployed and claiming [any kind of unemployment-related] benefit".

The measured 70% 'job club success rate' is therefore merely the proportion of those who, after 39 weeks of unemployment, still have more than £8,000 in liquid assets. It is nothing to do with whether or not they have found a job. The remaining 30% are those who have less than £8,000 in liquid assets. This 30% may include all those who were receiving what is currently called "means-tested Jobseeker's Allow­ance" before, during and after they attended that job club. If it does not, then I've never been officially "unemployed and claiming benefit". However, I shall assume that it must. Either way, this does not alter the fact that all who still have liquid assets of over £8,000 after 39 weeks of unemployment cease to contribute to the official unemployment count.

Having assets of over £8,000 is not the only condition for ceasing to be "unemp­loy­ed and claiming benefit" when Unemployment Benefit stops after 39 weeks. Some of the unemployed have independent income. This could be from a company pen­sion initiated by early retirement. It could be from personal investments. An un­employed person's combined income from such sources could exceed the threshold at which he will not be eligible for means tested benefit. If it does, then when that person's Unemployment Benefit ceases he will no longer be "unemployed and claiming benefit", even if he has no savings at all. But he still has no job. And the level of income needed to render him ineligible for means tested benefit is very low. So he still needs a job.

Inappropriate Employment

Even on the rare occasions when a 50 to 60 year old does find a job he rarely ends up in one which befits his accomplished level of skill, knowledge, experience and wisdom. Nevertheless, whenever an unemployed scientist, lawyer or engineer is eventually put in a job as a part-time van driver, store man or fast-food server, the unemployment figure is reduced by '1' and success is declared.

One particular person springs to mind in this regard. That is a 50 year old television royalty contracts lawyer who eventually and most reluctantly had to take on a new career as a security guard. From £36,000 a year to £3.20 an hour (1997) in one very difficult but inevitable step. So although the woman of whom I speak was no longer unemployed, she had become inappropriately employed.

The law actually requires people to do this. The law says that if after 13 weeks an unemployed person has not found a job within their established skill, they are required to apply for, and take, any job. This so-called downshifting rarely works. It is always psychologically damaging. It is wholly undeserved. It also contravenes Article 23 of the United Nations Declaration of Human Rights.

All this makes nonsense of the official unemployment figure as a meaningful indi­cator of how many people in the country are unemployed. It is (intentionally I think) deceptive.

Credible Figures

I think that the true unemployment count is the number of individuals in the country of working age who need some form of gainful employment to provide themselves and their families with their needs of life and have no form of gainful employment. The need exists in every working age nuclear family which contains no gainfully employed adult. A single person living alone is in this context a nuclear family. Gainful employment includes a permanent full-time job working for an em­ployer and also self-employment.

The only figures I have been able to dig up were those given in a report written by an organisation called the Third Age Employment Network. They introduce the no­tion of a group of people who are not recorded as unemployed but who are econ­omically inactive unwillingly. The figures for November 1997 shown in their report are given in the following table and compared in the adjacent pie chart.

These figures indicate that, according to my perception of what unemployment means, there were in November 1997 2,765,000 people between age 50 and retire­ment who were unwillingly unemployed. British society forcibly denied 2,765,000 senior Britons access to the means of transforming their labour into their needs of life. That is 36%! The report also shows that two thirds of these people are suffer­ing financial hardship. I know what they mean. And I think it is a national disgrace.

Hidden Agenda

Government serves the interests of those who possess, influence and control econ­omic power. Their view of success is a healthy economy. In this context, a healthy economy is a network of profitable inter-trading commercial entities. First and fore­most of these are the corporate interests of the economic elite. Nevertheless it is of advantage to this economic elite to include a critical mass of adequately affluent consumers. But there is no systematic requirement for it to include every­body. In fact, a healthy capitalist free market economy works best with a large min­ority of the population forcibly excluded.

A capitalist free-market economy has no motive or incentive to include everybody. On the other hand it does have a motive for keeping a certain proportion of the population excluded and poor. This is because doing so maintains a willing and sub­missive source of labour from what is inevitably a permanent buyer's market. This ensures that there will always be plenty of willing human resources 'waiting in the wings' who can be switched on and switched off again like machines to meet the ebbs and flows of production and market demand. It achieves this by keeping everybody in a per­manent state of fear of losing his job and hence becoming excl­uded and poor. But to keep a majority workforce submissive and willing, without invoking insurrection, the establishment must tread a careful path.

On the one hand, it must keep the apparent level of unemployment low enough

• to give the impression that government is struggling to eradicate it
• to prevent it becoming the dominant issue in the public eye
• to be credible as that which the global economy might impose despite
  all national efforts to reduce it.

On the other hand, to sustain the desired level of fear, the real level of unempl­oyment (that is, unwilling economic inactivity) must be high enough for everybody to feel it. In other words, it must be high enough to guarantee that every individual is, has been, or knows somebody who is without work.

To keep the workforce as willing and as cheap as possible, yet below the threshold of popular insurrection, it is necessary to maintain an illusion that unemployment is at one level while allowing the reality to gravitate to a much higher level. Hence the difference between the deceptive official figures for unemployment and the more credible figures for the 'economically inactive'.

I believe therefore that there is no real official intent to eradicate unemployment and that it has been left to the mercy of free market forces. The apparent measures and rhetoric to do with reducing unemployment are no more than a political exped­ient — an exercise in being 'seen to be doing' something to help the undeserving unemployed.

Conclusion

This may well create a 'healthy economy' but for whom? This kind of economy is fine for the greedy rich — or so they think. But it leaves the vast majority of individ­uals living very stressful and uncertain lives. For those who are unemployed it is soul-destroying. It drains them of all self-esteem. They are deceived into thinking that they are part of a small minority of worthless losers while in fact they are members of an enormous legion of good people who have been forcibly and un­de­servedly excluded.

In the final analysis, the figures and percentages for unemployment, poverty, de­privation and economic exclusion really are not the issue. What really matters is this: if so much as one person is made unwillingly economically inactive, then the entire socio-economic system, under which he lives, has failed. The rules which govern its operation are flawed. They fail to catch and handle at least some of the operational exceptions which actually occur. Therefore, as a system, it is dysfunc­tional in principle. A right and proper economy is one which is fail-safe from the point of view of every individual.

Only systems born of the minds of men can have this failing. Nature has no pre­cedent. It is time to question the capitalist free market system. We should ask seriously if this is the uncertain and inequitable way by which we wish to continue our stewardship of this planet. It is time to take the unprecedented step of intro­ducing morality into economics.

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Parent Document | ©May 1998 Robert John Morton