“Without growth, we are not going to be able to undo the importance of wealth.”
As part of our new Campaign for Social Science Achieving Good Growth project, last week we held a webinar exploring how the UK can address inequalities as part of ‘good growth’.
Chaired by Professor Bobby Duffy FAcSS, the webinar featured short presentations by Professor Heejung Chung, Professor Katherine Smith FAcSS and Professor Matthew Johnson FAcSS who all gave their perspectives on this topic through the lens of health inequalities, inclusive labour policies, and the differences in generational wealth between the present day and 35 years ago. Paul Johnson FAcSS, Director of the Institute for Fiscal Studies, provided his reflections in response highlighting themes of a lack of trust in the government to address social inequalities, some of the causes of stagnating growth and the impacts being felt today and his beliefs on how growth is fundamental to addressing generational inequalities.
Katherine, who is Professor of Public Health Policy at the University of Strathclyde, focused her presentation on social inequalities, particularly health inequalities, and how by addressing this the UK Government could move towards ‘good growth’. She began by drawing on recent data showing a widening of health inequalities in Scotland, including increases in avoidable mortality rates, low birth weights and drug-related deaths, and that this is linked to worsening outcomes in disadvantaged communities.
Katherine added, “It’s essential to acknowledge that health inequalities reflect intersectional inequalities. So, inequalities in gender and ethnicity intersect with socio-economic inequalities to shape health. […] While bar charts and line graphs provide essential information, it’s in the qualitative research that we get a sense of how deep poverty in the UK is, and of the ways in which intersectional disadvantages play out.”
Katherine moved on to discuss how reducing health inequalities is possible. She pointed to her recent work with colleagues on four case studies in four countries where each reduced health inequalities over time. Katherine highlighted that there were no specific initiatives that solved health inequalities, but that policy combinations including improved healthcare access, welfare state expansion, reduced income inequalities and enhanced democratic participation all had a role to play.
Katherine went on to discuss research which looked into what inclusive growth meant to policymakers. From this work, she said that inclusive growth appeared to be a malleable concept, which brought stakeholders with different ideas together, but was difficult to operationalise beyond high level policy strategies. She said, “If social scientists are to help reduce social inequalities, my sense is that we need to move beyond analysing problems and causal pathways, to focus on solutions and learning from evidence of success.”
Heejung, who is Professor of Work and Employment and Director of King’s Global Institute for Women’s Leadership at King’s College London, focused her presentation on equality and inclusion and the role that plays in growth and what inclusive growth means. She began by highlighting that fewer people are in jobs which enable them financial security and the means to have housing security and purchase property, and she followed this with exploring the idea of a narrative of division between different parts of society.
Heejung discussed how inclusive policies are not meant to be at the cost of certain groups over others but are intended to benefit everyone. She focused particularly on inclusive polices in the labour market and used the example of shared parental leave to highlight this point.
She said, “Shared parental leave is essentially about giving fathers more rights to spend time with their children. And it obviously helps not only support mothers back into the labour market, because their share of the housework is reduced, but it also helps with the child’s emotional, psychological development, even cognitive development which helps provide benefits for the entire society.”
Heejung also highlighted other policies including flexible working and the four-day week, which she said have proven to be popular among employees and there is evidence to suggest that they increase growth and productivity, as well as being more environmentally sustainable.
Heejung then turned her attention to what growth is and its purpose. She argued that the trickle down effect from increasing GDP wasn’t working well and that policies promoting purely economic growth were environmentally and socially costly. She said that to move towards a social model which benefitted more of society through reducing inequalities in the labour market, the public sector would need to play a bigger role in providing more secure jobs, particularly in the care sector. Heejung said, “The care sector is growing, it’s in demand, it’s going to be needed and it can’t be replaced by AI automation.”
She then ended with a final thought that when thinking about growth we needed to consider the wellbeing of society as a whole, beyond only monetary terms.
Matthew, Professor of Public Policy at Northumbria University, began his contribution with a cultural reference from the early 1990s to One Foot In The Grave, a BBC sitcom whose premise was that of a couple in what would now be considered low paid jobs, who owned their own home and were facing retirement. Matthew pointed out that, when he discusses this with younger people now, they can’t imagine such a reality, and yet that was reality for many families at that time.
Matthew said, “That was a way of life that was possible by virtue of massive public investment in the wake of the Second World War. Massive public investment that we regarded as essential at the time to rebuild Britain. That involved huge infrastructural expenditure that built hundreds of thousands of houses, that made housing affordable for people, that created a social security net, a health security net, that ensured that people’s outcomes of importance to them all improved.”
He then went on to explore how those trends have reversed in more recent times and that liberation of the market has not resulted in everyone benefitting from a growing economy. Matthew explained that there were no cheap solutions to this problem and that public investment in infrastructure, health services and social security systems was needed as the foundations to reinvigorate society. He argued that a system involving basic income could be one means of providing a social security net and enabling people to act entrepreneurially, through providing financial security and labour bargaining power.
Following the presentations, Paul Johnson, Director of the Institute for Fiscal Studies, gave his reflections in response to the panellists, highlighting some of the themes that had been mentioned. Paul began by highlighting that there has been no, or very little, growth in income per capita or earnings since about 2008, but that income inequality since that time has declined slightly due to increases in the minimum wage, albeit income inequality remains much higher than it was in the 1970s. He also pointed to homeownership for young people in their twenties and early thirties having declined since the mid-1990s, but highlighted that the big increase in inequality over the past 35 years has come from an increase in the importance of wealth and not an increase in income inequality per se.
He said, “When you’ve got no growth in earnings this means that younger generations are no better off than their parents. […] You’ve also got, partly to do with much lower interest rates over much of that period, partly to do with a complete lack of house building, a big increase in the cost of housing. And that wealth, of course, is focused in that older generation.”
Paul went on to discuss a recurring theme brought up by all the panellists which was trust in government to address issues of inequality and growth. He pointed out that those from lower incomes didn’t necessarily want more money from the government but wanted the opportunities to earn in their own right, which requires getting the labour market and regional policy right, having an effective minimum wage and opportunities for better education across the labour force.
He said, “This is not and should not be seen just as a question of redistribution. That’s never going to by itself give you the sense of a just society that I think people are focused on, to the extent that people are simply dependent on handouts. A) they don’t particularly like it, but secondly, I think it doesn’t give you that most important element of a just society, which is one in which all people are held in equal respect.”
Paul also reflected on the increase in health inequalities and commented on the dramatic increase in the numbers of people claiming disability benefit in the past three to four years. He discussed how health inequalities are the culmination of other inequalities and therefore is not easy to tackle, but that it needs to be at the top of the agenda to address. Paul also commented on the idea of a basic income and its feasibility, saying that practically to make a basic income enough for everyone to live on it would require significant increases in the tax burden and that this was unrealistic in today’s politics.
Finally, Paul ended with a final thought on how growth and inequality are linked. He said, “Growth and inequality are absolutely fundamentally linked. If we don’t get growth we’re not going to deal with the absolutely, in my view, the most important social inequalities, in terms of social mobility and generational inequality, because with no growth the thing that matters most to you as an individual is who your parents are. That is pretty much the most important determinant of your outcome later on, until you get growth, that will remain.”
You can watch the full webinar below.