Belfast Telegraph

Saturday 2 August 2014

We need some off-the-wall ideas to cut dole queues

Telling the unemployed to get on their bike is a staple of Tory rhetoric, but it's no substitute for policies that would really help to create new jobs, writes Robin Wilson

State of shame: unemployed people in Belfast call on the government to boost jobs here

For decades after the Second World War, an older political generation, scarred by the association of depression and fascism, remained committed to sustaining demand in the economy so that joblessness was minimised. The world-renowned British economist John Maynard Keynes had explained why modern capitalist economies, with their large financial sectors, no longer readily matched supply and demand – so that in 1929 (as in 2008) the Wall Street Crash could precipitate involuntary unemployment on a massive scale across the globe.

'One nation' Conservatives like Harold Macmillan as well as Labour leaders accepted this framework, which meant a loose fiscal policy of high public spending on public services and welfare, allied to high wages in a world of strong unions – boosting demand for the new commodities working-class households could for the first time afford and so stimulating private-sector employment.

As a peripheral UK region with a dual labour market disadvantaging Catholics, Northern Ireland of course never experienced full employment. But the change was real enough from a pre-war world where (as today) grass grew in the shipyards.

And Northern Ireland certainly felt the cold wind when Margaret Thatcher came to power 50 years after the crash, obsessed with destroying the trade unions, even at the cost of large-scale deindustrialisation. Tight monetary policy, set through high interest rates and an associated high exchange rate, drove many firms to the wall. And anti-union laws destroyed the capacity of workers collectively to bid up wages.

In the succeeding years, south-east Antrim, a former (predominantly Protestant) haven of secure, well-paid employment, saw the fastest rise in joblessness, as multinational after multinational–Courtaulds, Carreras, ICI – closed their shutters.

It was in this context, as unemployment soared, that the new employment secretary and Thatcher supporter Norman Tebbit assumed the podium at the Tory Party conference in the autumn of 1981, to declare that during the depression his father had got "on his bike" to look for work.

Joblessness, in other words, was down to feckless individuals who couldn't be bothered to get out of bed in the morning.

Yet fast-forward to another Conservative government once more presiding over mass unemployment. This time it has been inflicted through tight fiscal policy and the goal is no longer to destroy trade unions but to roll back the state – again, whatever the consequences.

But now there is no outcry when individuals are blamed for their own unemployment. Endless red-top stories about 'scroungers' have fed the rhetoric of the current chancellor, the silver-spoon Etonian George Osborne, about the 'skivers' on whom the 'strivers' should (rather than on the government) turn their ire.

This mindset reached its brutal nadir this week when the family of a Derry man, who is in a vegetative state since a sectarian attack, was sent an official letter querying his availability for work.

Demand in the Northern Ireland economy has been so hammered by austerity and recovery so insipid that the Department of Employment and Learning also revealed this week that there were still just 7,445 vacancies as of June this year. Set that against a jobless claimants count – never mind the many so discouraged that they have fallen out of the labour market into the ranks of the 'economically inactive' – of 62,400 (July figure).

And the imbalance is even worse: only 2,882 of those vacancies were described by DEL as 'live'. So there are nearly 22 unemployed individuals competing for every live vacancy in Northern Ireland.

If every one of those individuals was able-bodied, got 'on their bike' and was willing to accept any job anywhere at any wage, they could in theory cut the unemployment total to precisely 59,500.

Yet, based on the supply-side fantasy, DEL expends many millions on inefficient labour-market schemes.

They are mainly poor-quality remedial schemes, substituting for the high-grade technical education that a schooling system not obsessed by academic selection and a private sector willing collectively to provide proper apprenticeships (rather than poach each others' skilled labour), as in Germany, would ensure.

Job creation is precisely that – a task for the demand-side:

* The Department for Enterprise, Trade and Investment needs to establish a revolving investment fund, through which Invest NI would take equity stakes in start-ups and firms anxious to scale up, privileging innovative firms and growth sectors in the 'green economy'.

* DEL needs a step-change in its support for business research and development, where Northern Ireland lags woefully behind, especially in turning more spin-outs from the universities into major employers.

* The Department of the Environment and the Department for Social Development need to champion the Green New Deal, hiring a 'green-collar army' of workers retrofitting homes so they are easy to heat and generate their own power.

* And DSD needs to re-establish the Action for Community Employment scheme, fostering socially useful employment in the third sector for the otherwise long-term unemployed.

The Northern Ireland Life and Times Survey has clearly shown that tackling unemployment and poverty is the first or second policy priority for the bulk of the region's population. Would that were true at Stormont.

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