We need to talk.
I know that since the financial crisis, things have been tough. Hard decisions have had to be made and we all have to work harder because there is no money. Actually, that’s not quite true; there’s lots of money, but isn’t worth as much (see Quantitative Easing). I know everyone in blaming each other – the banks, the political parties, the technocrats, but that doesn’t help. The money has been lost in a gamble that sub-prime mortgages would continue to have value despite having no chance of ever being paid off. The gamblers lost, and so did everyone else.
It turns out that money-for-nothing gives you nothing. Who knew?
So it’s been tough, but you’ve not been pulling your weight. We know this because productivity is down. It’s down 16% compared to pre-financial crash figures (source: Bank of England) – i.e. ten years ago. We should be more productive, but we’re not. The puzzle is, why not?
This is a puzzle so serious that the Bank of England is doing research (pause for irony). It is partly explained by a lack of business investment, caused by a dearth in lending after the banks found out that lending money is a bad idea, so they almost stopped doing it. That isn’t enough to explain the difference, though. It’s a relatively small factor that leaves a big unexplained gap in productivity. With encouragement, lending has recovered to an extent, but productivity hasn’t.
The big factor is the weakness in labour productivity. That’s you and me. Apparently government is puzzled by the fact that we are, overall, less productive by about 16% in the last ten years. That’s taking into account those of us who don’t have a job to work at, by the way.
It’s not like we’ve been shirking. Most of us work longer hours, feel more stressed, and have a worse time at work. We don’t find it as rewarding in any sense, and if you’ve had a real-terms pay rise in the last five years then you are an exception. Many have had a pay-cut. Management has exhorted us to work harder, or in some cases smarter, and we’ve been under pressure so long that it’s come to feel like that’s normal.
I would like to be presumptuous and tell the Bank of England that a bunch of Economists are the wrong people to have looking at this. It’s not about money, wealth, or possessions. It’s about life.
When you go to work, you make a deal. The deal is that you give up your time and you will endeavour to do something, and in return you are compensated. That may be directly as in a window-cleaner (I clean your windows, you pay me) or indirectly (I process your insurance claim, and the insurer pays me). That’s not the end of it, though. I also want your respect and appreciation. I’m doing a job and I want recognition from you and from my peers for the job I’m doing.
In the last ten years that last part has been undermined by a philosophy that says, in a recession, there are always more people that want a job, and if someone doesn’t want to work then they will be replaced by someone who does. I don’t have to respect you, or appreciate you, or value you. I can just replace you. it goes back to the model of organisation as machine. Workers are cogs that fit into the machine and churn out work – or as we might call it, Productivity.
Not only that, but if you don’t want to work then you will be made to, and probably for less money than it takes to live. Zero hours contracts, minimum wage jobs that incur expenses that are not accounted for in the wage calculations, extra hours that are unpaid and unappreciated. That’s not a government statistic, it’s a fact of life. If you don’t work (and the reason really doesn’t matter) then you will be humiliated and starved until you do.
This is the logical outcome of an economy based on market forces, which was started in the 1980s and has carried on unchallenged. It was mostly fine when the economy was booming on personal lending and bonuses paid on reckless gambling because the chickens never came home to roost, but as soon as that stopped, everything changed. The market giveth and the market taketh away. It taketh away your dignity, your self-respect, and your right to be valued as a contributor to the national wealth. You are no longer a person, you’re an economic unit and you’ll be treated as such.
You can go to a job and endeavour to do your best, and be treated as a person who is contributing to the work at hand, the organisation concerned, and the nation as a whole. Most people want to do a good job. It’s human nature to work towards a satisfactory outcome.
Or you can be at your workplace. Presence is not productivity. People who work under threat of job cuts are less productive. People who do not have a commitment from their employer are constantly worrying about what comes next, not what’s in front of them. People who do not receive respect do not return that respect. Those who are badly treated worry about their treatment, not about their work. It undermines confidence, security, and well-being. It makes people sick and tired. Meanwhile the rich get richer and the super-wealthy become more insulated from the rest of us. Gated community, anyone?
If you treat people badly, they are less productive – 16% less productive.
So maybe it’s time to ask (with apologies to John F Kennedy) not, what can you do for your country, but what can your country do for you? Can it make your work more enjoyable, less stressful, less threatening, more constructive, and ultimately more productive. Can it support you when times are hard and help you achieve your best when times are good? Can it make your life better?
The only way out of our economic situation so that we do not need austerity or cuts is for productivity to rise. Otherwise we are simply talking about who gets more of the pain.
Who is brave enough to make the change?