WorkerTech Newsletter – June 2024 The latest update from Resolution Ventures 28 June 2024 by Louise Marston Louise Marston The Resolution Foundation team has been very hard at work in recent weeks preparing a series of excellent pre-election briefings ahead of the general election on the 4th July – see below for some examples. But what might this election mean for the future of work? The team have helpfully summarised the key issues, as well as progress since 2010 in a new report this week, ‘Job Done? Assessing the labour market since 2010 and the challenges for the next government’. And if you’re looking for funding for your Workertech idea, our friends at Bethnal Green Ventures and Ufi VocTech Trust both have programmes open for applications right now – read on for more details. And of course, you can always talk to us. Best wishes, Louise Marston Director of Ventures What’s happening in the UK job market as we approach the election? It’s hard to avoid the pre-election build-up in the UK. Amongst the jostling between parties and policies, it’s important to look at the current state of the UK, and the challenges that the new government will soon face. In the case of the world of work, the election could bring big changes to how work is regulated. In a new report, “Job Done?“, Resolution Foundation researchers Nye Cominetti and Hannah Slaughter look at these potential future changes and also give us a picture of what’s happening in the job market. This pre-election briefing summarises the state of the labour market since 2010, and highlights challenges for the next government. Since 2010, there has been an overall rise in employment – although it has fallen since a peak in 2019 – and wages have stagnated: average wages are now only £16 per week higher in real terms than at the time of the 2010 election. The party manifestos also highlight very different approaches to these issues, including the minimum wage, and worker rights. The report helps us understand what policies we might see after the election, and the challenges the new government will face. This week, I wanted to highlight five big challenges of the job market in the UK in 2024 that Resolution Foundation research has covered. All these issues are ones that both policymakers and social entrepreneurs need to respond to in the coming years. More people are working, but there are still some concerns: More people have jobs now than in 2010, which is generally good for living standards: having a job is still the best way for someone to escape poverty. We’re seeing more women, people from low-income households, and older workers in jobs. This is partly because people are responding to being poorer by working more, and because people are having to work longer before getting their state pension. Employers need to think about how to support these different groups of workers and their needs. More people are not working or looking for work: As of April 2024, 9.4 million people aged 16-64 in the UK are neither working nor looking for work (known as ‘inactive’ in the statistics). This number has gone up mainly because more people are long-term sick, rising from 5.1% to 6.8% between 2019 and 2023. Supporting people with health conditions who want to work is a big challenge for both employers and the government. Wages haven’t grown much, except for the lowest-paid: Overall, wages haven’t been increasing much when you account for inflation. This affects people’s standard of living. However, the lowest-paid workers have seen their wages grow faster. For example, between 2011 and 2023, bar staff saw their real hourly pay go up by 26%, waiters by 24%, and cleaners by 20%. This is much better than the average worker, whose pay only went up by 1.9%. As a result, the gap between low-paid and average-paid workers is the smallest it’s been since at least the mid-1970s. The political parties have different ideas about the future of the minimum wage, so this trend might change. Not enough skills in some areas: Some job sectors don’t have enough skilled workers, and workplace training has been decreasing. The people who need training the most are often the least likely to get it. Higher-educated workers get more training at work. Younger workers are getting less training than before, and the training they do get is often just about health and safety rather than improving their skills. Students who have to retake their GCSEs often struggle to pass and don’t feel they get enough support to catch up. (For more on these issues, see previous reports ‘We’ve only just begun’ and ‘Train in Vain‘). Possible changes to worker protections: The Labour party is suggesting big changes to employment law. These include giving workers protection against unfair dismissal from their first day on the job and improving sick pay. If implemented, these could be the biggest changes to worker rights since the minimum wage was introduced. However, the details aren’t clear yet. Any new rules will need to balance protecting workers with keeping the job market flexible. It’s also important that workers know their rights and that there’s a system to enforce these rights effectively. Do read the full report to get a full picture of these issues. What do you think are the biggest issues facing the UK jobs market? And what are the key barriers to creating more good work in the UK? Latest insights from the Resolution Foundation This month, the RF research team have been providing lots of analysis and context on the forthcoming UK General Election. You can find the full list of our Election Briefings here. Hard times – Assessing household incomes since 2010 At the General Election, living standards growth should be on the agenda for any party wishing to form the next government. This is because income growth since 2009-10 has been particularly low, with typical non-pensioner household incomes growing by just £1,900, or £140 per year. Whichever party forms the next government must be willing to take steps to boost living standards, so all families in the UK can experience shared growth. Old Age Tendencies – the impact of tax and benefit changes on intergenerational fairness This briefing looks at the impact of spending, tax and benefit decisions taken since 2010 on intergenerational fairness. It finds that the increased generosity of the State Pension has benefitted old age groups, while the effect of tax and benefit changes has been to leave households with children worse off. Under strain – investigating trends in working-age disability and incapacity benefits The benefits bill has been the topic of debate during this election campaign, and this briefing looks at what’s going on with trends in working-age disability and incapacity benefits. It highlights the complex set of underlying drivers behind the increase in disability claims, which in addition to health causes, include increased awareness, an ageing population and financial strains in other parts of the benefits system. WorkerTech stories Managing Impact risk A couple of weeks ago, I co-hosted a discussion on Managing Impact Risk with Dama Sathianathan and others in the Impact VC network. You can read my write-up of our thinking on this topic here. Good Work Algorithmic Impact Assessments Our friends at the Institute for the Future of Work have recently published additional tools to help implement their Good Work Algorithmic Impact Assessments, in partnership with the TUC. These practical resources support the process of involving workers in the anticipation of risks and opportunities, the actions to mitigate those risks and maximise the benefits of any opportunities for workers as a result of introducing new algorithmic and AI tools. You should also check out their UK Disruption Index, published as part of their Pissarides review. This tool and accompanying report measures the capacity of regions to invest in new technologies and the factors that enable firms to adopt and integrate new technologies. Highlights from the Workertech portfolio: Nat Whalley, co-founder of Organise, the platform to give workers the tools and confidence to create change at work, was recently featured on the Tech Can’t Save Us podcast, discussing their recent progress in the U.S. and their approach to change. Equal Care Co-op have written up their learning from the LOTI-funded pilot, trialling their inclusive and co-operative approach to care in London. Tradeswomen’s platform TaskHer were featured in The Sun this week, highlighting the need for more women in skilled trades, alongside the need for more women in engineering roles. Claudine Adeyemi-Adams, founder of Earlybird, has been speaking at the IEP Summit on how to aim for the highest employment rate in the G7 – see the key points from her talk here Get involved Apply for direct investment from Resolution Ventures. We accept applications from WorkerTech ventures on a rolling basis. Or you can book a slot in our office hours for an initial conversation. Applications for the next Bethnal Green Ventures Tech for Good Autumn programme are now open. Apply by 28th July to be eligible for £60,000 of investment and their six week support programme. You can also book in a time to talk to the team about whether it’s right for you. BGV alumni in our portfolio include TaskHer and Organise. The Ufi VocTech Trust Challenge Impact Network + Grant Fund is open until Monday 8th July, and you just have time to sign up to their final pre-application workshop on Monday 1st July. This programme aims to fund technology-enabled solutions to three specific skills challenges: employer integration, pathways within and into work, and vocational language barriers. Successful applicants will receive between £200k and £250k.
