A stable labor market is a ‘mixed blessing’ for British workers

The pace of change in the UK labor market has slowed to its lowest level in decades, and even ending the pandemic, was far from a reversal of the 1980s, according to research by the Resolution Foundation and the London School of Economics.

That think-tank said his findings, released Thursday, run counter to the popular perception that changes in working life are accelerating, with robots that quickly replace humans i gig economic affairs replacement of factory work.

“These claims are very broad. The reality is that the pace of change is slowing down, not accelerating, ā€said Nye Cominetti, a senior economist at the Resolution Foundation.

The UK has experienced a huge long-term shift in employment from manufacturing – whose workforce fell by more than 5 million between 1970 and 2021 – to professional services, health and education, as well as lower-paid sectors such as hospitality and administration.

This change has not been fully achieved through brutal mid-career layoffs: much of the decline in manufacturing employment was due to the organic process when older employees left the workforce altogether and young people joined other sectors, the report said.

But the rate at which jobs in various sectors have grown and shrunk has slowed dramatically, reaching its lowest level in a century over the past decade. Even in 2021, with all the dislocations due to the pandemic, changes in the labor market structure accounted for only 7 percent of total employment, about a third of the peak reached in the late 1980s, researchers found.

The Resolution Foundation said this relative stability was a “mixed blessing for workers” because it reduced the risk of people losing their jobs and being forced to go worse – but it also meant fewer opportunities to move to a new job that offered a better salary. and prospects.

The share of workers who lose their jobs in each quarter halved between 1991 and 2019. But the share of workers who decided to change jobs in each quarter also fell sharply, from 3.2 percent in 2000 to 2.4 percent in 2019. – a drop of 25 percent. Meanwhile, the share of workers who decided to move to a new sector fell by 35 percent over the same period.

This is a potentially bad side, as over a 50-year period, wage growth for workers who move jobs averaged 4 percentage points higher than for those who chose to stay.

However, the report warns that the pace of changes in the labor market is likely to increase in the next decade, as the combination of Covid-19, Brexit and the transition to net zero reshapes the economy. The authors add that policymakers should try to facilitate the transition as much as possible by directing young people to careers in growing sectors, rather than “trying to speed up the departure of older workers” in the 1980s style.

“Workers should make the most of this change by moving to a wage-raising job,” Cominetti said, adding: “Many workers will also lose, however, and will have to be better protected than they were during previous periods of major economic change. ā€

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