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Making GDP the focus of a post-coronavirus economy would be a mistake

Growth often doesn’t benefit the people who need it – a green economy could create 1 million jobs writes Carys Roberts in The Guardian

 

‘A green recovery does not mean adding on a few green job programmes to a larger, fossil-fuelled stimulus.’ Low Bentham Solar Park, North Yorkshire. Photograph: Peter Byrne/PA


The UK lockdown might be easing, but the path ahead for the economy will be long and difficult. Unemployment this quarter is likely to rise twice as fast as it did following the global financial crisis. Almost half of businesses that have taken up one of the government’s bounce-back loans do not expect to be able to pay it back.

It’s tempting in a crisis to want to do whatever it takes to get economic activity – measured by GDP – back to where it was before. But an overwhelming and singular focus on increasing GDP would be a mistake. GDP figures do not tell us who is benefitting from growth. GDP does not tell us whether environmental resources – and nature – are being dangerously depleted, and does not reflect the value of caring, much of which is performed by women.

Boris Johnson has called for the UK to “build back better”, but to use government resources and capacity most effectively and – more fundamentally – to take the opportunity to build a better kind of economy and society, we need to know what it is we want to rebuild. This is precisely the moment to think beyond a blind pursuit of GDP, about what kind of economic activity to bring back and prioritise, and what we could do without. Any stimulus package must be tailored to create not just any economic activity, but that which will serve society best. As a result, any recovery or spending plan should be scrutinised not just on its size, but what it is spent on.
This must be a green recovery. That does not mean adding on a few green job programmes to a larger, fossil-fuelled stimulus: the whole recovery package must accelerate the UK’s path to net-zero carbon and restore our natural environment, which is in crisis. Anything else risks emerging from one disaster only to accelerate headlong into another. As the government turns on the taps to boost the economy, there is a huge opportunity to fill the £30bn per year funding gap for green investment. 

The recovery must target well-paid, high-quality jobs, spread around the country. These must provide good work for those who have lost it as a result of Covid-19, as well as people previously locked out of the jobs market or at risk of being left behind on the journey to net zero. This is a more profound shift than it appears. Currently, stimulus packages aim to boost GDP, and jobs are a way to get there. But what matters is that ordinary people have access to secure incomes – both for themselves, and because this will ensure spending in the economy (people who need money are more likely to spend it) and a sustainable tax base. An alternative approach, for example, of loosening lending restrictions for mortgages, might boost GDP but would do so by increasing debt and raising house prices, benefitting the already wealthy while hurting people without wealth.

The recovery must involve a reconsideration of what is valuable in society. The pandemic has put into stark relief the extraordinary contribution of health and care workers, many of whom are women and migrants, and the essential support of key workers across the economy. The recovery must recognise that contribution in higher pay and better working conditions. So, too, the pandemic has caused conversations up and down the country about unpaid care work and who performs it. But the easing of lockdown has prioritised marketised activity over human relationships, which don’t require cash. You can visit your parents at home, but only if you want to purchase their house or clean it. The recovery should recognise and reflect what is important to people and valuable – not just economic activity.

Britons want quality of life indicators to take priority over economy

 These goals are not in conflict but instead are inextricably linked. Achieving them requires and provides an opportunity to rethink an economy that doesn’t work for so many across the country or for future generations. We estimate that close to a million good jobs could be created in this new, green economy, with many more if we choose to invest in our social care system.

Talking about and targeting the “economy” as an abstraction masks the underlying shape and nature of the activity taking place underneath. It means we miss people: who loses out, and who benefits from the status quo being restored. Lockdown has found us in a collective moment of reimagining, but this will not last for ever: we should use it to ask what economic activity we want to rebuild, and what we could do without.

We say we value key workers, but their low pay is systematic, not accidental

If those who care for us are to be first, not last, we have to look at the conditions that drive wage stagnation and insecurity writes Zoe Williams in The Guardian  

 

Military personnel help administer Covid-19 tests for NHS workers at Edgbaston cricket ground in Birmingham. Photograph: Jacob King/PA


This weekend brought the news that two workers at London’s Pentonville prison, Bovil Peter and Patrick Beckford, had died with symptoms of Covid-19. “Symptoms” is nowadays a euphemism for “they weren’t tested”, and a grim reminder of the hundreds of thousands of key workers we are asking the world of, but whose selflessness is not being reciprocated.

These are tragedies laced with guilt for all of us: plainly, the most dangerous place to be during this epidemic is in a densely populated care environment, whether a hospital, school or prison. People work in them because they have a passion, but also because there is no alternative, and they do so on all our behalves.

Prison officers have always been the unsung heroes of public duty: never quite macho enough for the people who glorify the armed forces; always a bit too authoritarian for those who valorise nurses. They are some of the most inventive and diligent people working anywhere in the business of caring for others, but they have generally done so without much credit. 

This crisis is forcing an urgent re-evaluation of that, along with all those other jobs that were previously classed as low-value yet now turn out to be the most important in the country. Words are not enough, and nor is clapping; you can praise care workers to the skies, but if you’re paying them the minimum amount in 15-minute segments, without security of hours or of employment, without sick or holiday pay, then the praise is hollow.

You can wax sentimental about the holy vocation of nursing, but you cannot then bring second-year students on to the frontline to fight coronavirus and still expect them to pay their tuition fees. You cannot claim, as the health secretary, Matt Hancock, told Andrew Marr on Sunday, that this isn’t the right time to talk about pay rises; it is the best and only time to talk about pay rises, when we have finally realised, with a jolt, just how much we rely on people who put their jobs ahead of their own safety.

Yet this is about more than money: Keir Starmer accepted the Labour leadership on Saturday with the rousing Old Testament statement about all key workers, cleaners, paramedics, carers, porters: “For too long they’ve been taken for granted and poorly paid. They were last and now they should be first.” But what would it actually mean to put these jobs first? Money is some of the answer, but we also have to look at the conditions and assumptions that drive wage stagnation and the steady erosion of security.

There is nothing radical in the observation that jobs are often described as low-skill, when actually they are just poorly paid. More radical, yet still accurate, is the assertion that they are characterised as “low-skill” deliberately. Caring is a job of tremendous skill, hard as well as soft. And while there is a huge amount of bolt-on expertise that employers require, from administering medicines to dealing with dementia, this is not reflected in any career progression. It is not unusual for a carer in her 40s to be on the same hourly rate, adjusted for inflation, that she was on at 18.

This has been systematic, not accidental. Without progression, the wage bill can remain reliably static, which is the only way the financial architecture of the sector makes sense.

There is often better progression in public sector work, but the combination of the austerity-years pay freeze and a new normal (extending even to the police) of people at the start of their career being expected to work voluntarily, which itself erodes starting salaries, has had a striking effect on these jobs.

Ironically, Theresa May was right when she famously said that a nurse might use a food bank for “complicated reasons”. Of course there’s a very simple reason – that nurse is not being paid enough. But the feedback loop between the private and public sectors – low pay, insecurity and poor conditions legitimised in one sector and migrating to another – is actually quite complicated.

And there’s an overarching fallacy, that a job many people could do must be inherently low in value. By these lights, huge numbers of people – cleaners, drivers, shop assistants – are without prospects, being so replaceable. The times are testing this assumption to destruction – when you’re looking for the people whose courage we need in order for civilisation to survive, you don’t have to look much further than the postal worker or the hospital porter.
In the immediate term, putting key workers first means personal protective equipment; it means collective and determined effort to strip as much risk as possible out of essential jobs that simply wouldn’t get done if everyone looked out for themselves. But there will be an era after coronavirus; and one thing to carry into it will be a determination never again to think, talk about or treat people as though logic demands they should be screwed down to their lowest possible price.