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Why do we accept low pay for key workers as the norm?

Steve Bridger

| 0 Posts

Community Manager

14 Jul, 2021 16:25

Key workers tend to earn less and suffer poorer job quality than others: why do we accept this as the norm for so many roles that play such an important part in our society?

Melanie Green poses this and others questions in a new post here:

https://www.cipd.co.uk/Community/blogs/b/research-blog/posts/does-low-pay-and-poor-job-quality-really-need-to-be-an-inevitable-fact-of-key-worker-life

I'd be particularly keen to hear from those community members who work in care settings.

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  • Because budgets are cut to the bone and below.

    Because many of these functions are outsourced and contracts are awarded to the lowest bidder.

    If government and employers won't pay more than they absolutely have to, how will it ever change?
  • This question has a two-part answer; the second leading from the first. Most of what we today call "key workers" are involved in caring and supply roles. Historically, the former were commonly local services carried out by volunteers: Go back even less than 100 years or so and midwifery, home nursing, terminal care, and similar services, today part of the NHS, were essentially unavailable except to the very wealthy or within charitable hospital (or workhouse) settings. These local volunteers could afford their practical largess because they would receive gifts of payment in kind, rather than pay, from the family and friends of those they helped. (Even as late as 1974, when I joined the Ambulance service, some areas of the country still had services organised and provided by Red-Cross and St John, with volunteers supporting a limited number of local-authority paid staff).

    Early hospital nursing and care, through to the end of WW1, was also often carried out by those to whom pay was secondary to the personal satisfactions and empowerment the role had to offer. Mainly women from middle- or upper-class families they had the necessary education to undertake the roles, but little need of independent income. "Lower class" women were still disenfranchised and their education considered an unnecessary luxury, so rarely gained real qualification, but nevertheless carried out the lower-status but essential "local" roles; based on knowledge "passed down" from their predecessors.

    For these caring staff the satisfaction of their work (and the respect or empowerment it gained) made up for any lack of "cash in hand".

    The same was true of those involved in food and fuel supply and logistics. Farmers and farm-labourers were paid low wages but had many "tied" payments in kind, such as housing, food and other necessities. Similarly miners and the "Coalmen" local distributors had access to free fuel, and for some miners also housing, although wages were paltry.

    As all these facilities were nationalised, centralised or internationalised (particularly as petrol and oil replaced coal for heating, sea and rail-transport and the NHS took over (most) care facilities) the "traditions" of low pay and these roles being carried out as a low-paid "vocation" or family tradition (in the case of farming etc.) transferred also. Although in some cases (e.g. mining and rail-transport) the new strengths of unionisation demanded better pay and conditions and had the means to obtain them, the "carried forward" effect was of the roles having lower-than average payment, "bought off" by the commitment of those who carried out the roles and/or the satisfactions of the roles themselves.

    Today, the reasons for payments remaining low are very different and largely political. To increase pay across, say, the NHS or food-production and distribution industries would require, in the former case potentially massive tax-rises (or unpopular reallocation of funds from other Government commitments), in the latter large price-increases in the shops and hikes in the cost of living. Which Government (of any party) could expect to survive the former, or be seen to sit aside to let the latter happen?

    History therefore provided the platform for labour-intensive facilities like care and distribution to be low-paid, and politics (small "p") and now-international competition keep the associated roles' pay-rates low. The pay-offs of job-satisfaction, commitment, working flexibility and other "work life balance" issues keep people in care and distribution roles and seem likely to do so for some time to come, although the cracks are beginning to show: For example Brexit's exposure of the lack of "home grown" Nurses etc. in the NHS. People who can now obtain better paid, less demanding roles to offer better lives to family and children (setting aside themselves) now often make that choice.

    Of course there are many other factors involved and contributing, but most of these are secondary to those two primary drivers.

    P

  • I agree with Peter and Elizabeth. Ultimately supply and demand will result in a balance point in the labour market. Once working environment, job satisfaction and all the other elements of an offer are in balance with what people are willing to accept, then jobs will be filled - even if for moral reasons we believe better pay and conditions would be more désirable.
    If that balance does not exist, jobs will remain vacant.
    Elizabeth rightly points out that budgets are not infinitely elastic, and that the willingness to fund salary increases through increased taxation or cuts elsewhere simply is not present - either in the political world or the working world.
    In the UK there is a cultural tradition of light government financing in many of the areas where low-paid key jobs exist. I personally cannot believe that employees would accept 20% social security contributions and employers 50% (as in France, for instance) to bridge this gap.
  • In reply to Ray:

    These statistics on equality of income distribution may help paint the international picture:

    data.oecd.org/.../income-inequality.htm

    It's a complex topic I think in economics - partially but only partially yes it's supply and demand for labour but also it's to do eg with equality of distribution of wealth and Government policy / interventions re income distribution eg taxation; minimum wage etc.

    Also, equality in terms of everyone being poor isn't necessarily at all the same as inequality but with even eg the poorest quartile being reasonably rich compared with the former - if you see what I mean.

    However, overall, and probably for equally-complex historical political and cultural reasons the UK seems to well towards the higher end of the inequality indices compared eg even with nations such as Austria, but ultimately this is a social policy / political matter?
  • In reply to David:

    Again I think we have to look to history for the answer as to why inequality seems the remain more tolerated in the UK than elsewhere David.

    Post WW2 almost all the remaining European monarchies had been either decimated during the expansion of the German Reich or returned from exile to cultural infrastructures devastated by war and with social hierarchies similarly demolished. In the UK and its empire/commonwealth those hierarchies and integral respect tor social "rank" remained and have largely continued to do so to this day, albeit gradually decaying or being deliberately set-aside, but also transferring easily to corporate leadership and structures as well as previously to hereditary acquisition. The underlying acceptance of certain roles being low paid in financial terms though in some cases offset by other "benefits" has therefore also remained: The one time butler or housemaid providing ill paid but alternatively recompensed (by food and shelter) "key" personal services of care and convenience for their social "betters" now subconsciously replaced by the care-worker or delivery-driver providing key personal services of care and convenience for our sick and elderly, or high-street "consumer" and home-shopping customer.

    On the other end of the scale this is also why we continue to tolerate (albeit sometimes grudgingly) the disparity between salaries and disproportional taxation seen partitioning our "shop floors" and Boardrooms, and have continued to accept Government policies (from both parties) that failed to address (or at times enhanced) those inequalities.

    Our lack of urgency regarding, or even recognition of, financial and social inequities are therefore not because we perversely don't care about them as much as other nations, or would not be a fairer and possibly happier society without them, but because we have been brought up within them and familiarity presents a far more comfortable acceptance than they justify or deserve.

    P
  • What does everyone think about the concept of a universal basic income? Would that help to address some of the inequalities?
  • I think we also need to exercise some caution here. The concept of a key worker isa wide one and now seems to cover a wide range of jobs. So whilst fully accepting some key workers are indeed paid poorly (in care homes etc traditionally due to some of the issues highlighted above) not all key workers are.

    Median total earnings for Police Constables and Sergeants is £40K and many quickly reach the top of their pay spines. Newly Qualified Teachers earn £25K+ and again many rise by annual increments to 40K. According to the RCN the average salary of a nurse in the NHS is £33K. (And accept that with any average there will be lower examples as well as higher ones). Some though not all these jobs also come with additional benefits that are important when making comparisons

    Whilst none of these salaries is going to make you rich or even very comfortable, they are all above the "average" salary in the UK.

    So let's be clear which key workers we think are low paid. Often (not exclusively) it's those requiring lower formal "skills" (and accept that people also do these jobs for other reasons) and can in some ways be seen as a factor of a normal market, improve skills and improve prospects.

    For what its worth Jacky I think there is some merit to the discussion about a Universal basic payment. But it won't (I think) help this debate for the majority of people at the bottom as in effect it will simply replace benefits. It may in fact make the situation slightly worst for some at least in terms of differentials
  • In reply to Keith:

    When I posted on this thread I had in mind the workers who provide domiciliary care. I think I am right that contracts for domiciliary care are awarded by Social Services and provided the supplier can meet the minimum standards to fulfil the contract, they go to the lowest bidder. I would speculate that outsourced hospital jobs (porter, cleaner, canteen worker) operate on much the same lines. I don't think there is much opportunity for progression for this type of worker. There might be a supervisory role for someone to organise rotas etc, but its going to be for a small addition to their hourly rate. Whereas, as you point out, some key services (the police, fire service and teaching, for example) can provide a career structure and the potential of a senior job on considerably higher pay.
  • In reply to Elizabeth Divver:

    www.equalitytrust.org.uk/scale-economic-inequality-uk

    provides some further data that might be very relevant - especially that the poorest fifth of UK gets only 8% of the total income whilst the wealthiest fifth gets 40% of it.

    To my mind anyhow, something’s not quite right ( in any sense of the word ) here - but hey ho it’s that wealthiest fifth who tend to run the country, isn’t it?

  • In reply to David:

    David indeed there is something not quite right. But that's not "necessarily" linked to being a key worker. Many of those people are in cleaning, retail, factory, security etc.

    I guess what I am trying to say is that I think the debate to be had (which I also think is what you are saying) is far more about social justice and inequalities across the economy rather than restricting it to particular sectors.
  • In reply to Elizabeth Divver:

    Elizabeth

    Contracts no longer go to the lowest bidder, in areas we work in i have not heard of this at all, they go through a formal process, most Local Authorities award contracts via an ethical framework.

    The Local Authority give the hourly rates to the provider and a provider will have to make that work, this rate is authority wide. Different areas of support may have different rates, but usually all domicilary care is paid to all providers at the same rate.

    I won't go into support workers pay, I will be here all day, but I will say that the the skills they are required to have are not always reflected and recognised.

    You are right there is not always the progression, but also a lot of staff just want to stay in the support role as that is what they feel is best for them.

    Sharon
  • In reply to Keith:

    Very true Keith. The initial question being about key workers, we cannot ignore that many other workers are also low-paid, for many of the same reasons that some key-workers are, nor should we ignore that many once low-paid key workers became and/or are adequately or even well-paid. The mystery seeming to be not why these inequalities exist or have remained existent, (as explored above) but how they should be addressed and removed. As you suggest, much debate to be had.

    Much as it might temporarily relieve the problem of financial hardship, I feel a universal basic income will not make housing available for those currently unable to afford rent, it will merely create a shortage encouraging rents to rise and exploitation, such as multiple-occupation of unsuitable dwellings, to increase. Similarly for other resources currently of limited access to those in poverty: Being able to buy more food will further exacerbate our increasingly stretched supplies, driving prices up and (potentially) quality down, and on every level a UBI can only become a benchmark of necessity for payments by those who see "fair" incomes as an unnecessary liability to their profits, and a (powerful) force for inflation. Regrettably, I believe the effect will be more opportunities for exploitation of those existing on the UBI and not a long-term solution to poverty. I have no answers, but don't feel a UBI, if not associated with other substantial changes, is one either.

    P
  • I've been thinking about pay a lot recently, in trying to re-think reward in my organisation. When you think logically about most roles in just one organisation, there isn't much to justify the huge disparity in pay rates that are given. We all come to work, usually for a standard amount of hours, put in a reasonable amount of effort and (hopefully) gain some satisfaction from the work we do alongside the pay that we receive - but even the aim for a reasonable wage ratio is that the top earners in an organisation should receive 20 times as much pay as the lowest (and currently most FTSE businesses would be nowhere near as close as 20x).

    Logically, we should pay our cleaners more than our chief executives, because I think most of us would get more intrinsic satisfaction (and therefore less requirement for extrinsic motivation) from the latter. And you could probably sustain an organisation for far longer without a chief executive than without its cleaners.

    It's just down to labour markets - the skills required for cleaning can be learned quickly and build upon the daily skills that we all need in our personal lives, whereas leading a company demands (probably) qualifications, experience and the type of personality that narrows the field significantly. Care is similarly accessible to a wider labour market, at least in theory - though in practice, I think you need to be a pretty amazing kind of person to undertake care work on a regular basis, whether paid or unpaid.
  • In reply to Nina Waters:

    Nina Waters said:
    Logically, we should pay our cleaners more than our chief executives, because I think most of us would get more intrinsic satisfaction (and therefore less requirement for extrinsic motivation) from the latter. And you could probably sustain an organisation for far longer without a chief executive than without its cleaners.

    That's only one interpretation of logic based on one value set. An alternative would be who adds most value and fundamentally an CEO will help create and sustain the employment of all the people in that business, their salaries, livelihoods etc. A cleaner whilst important doesn't. A CEO may well have far higher demands on them, stresses and pressures etc.