Monday, 1 December 2014

Crazy Idea 16 - Create full employment


Once I started looking into the UK Budget, I started playing around with the numbers and found an interesting fact: full employment in the UK is possible.

According to the ONS, from July to September 2014, unemployment fell to 1.96 million. (CI016A)

(I can’t just state that government statistic without pointing out that according to The Guardian: “Economists said the fall in unemployment masked other signs that the jobs market was weakening. The fall in unemployment was partly explained by the rise in the number of economically inactive people”) (CI016B)

Anyway... Minimum wage for those aged 21 and above is currently £6.50. (CI016C)

If you multiply the number of people currently unemployed by what it would cost to employ someone full time on the minimum wage...

A smidge under £25 Billion! Our Government could eradicate unemployment for less than half of what they currently pay in annual interest on our National Debt.

Could you survive on minimum wage? I couldn’t. I kept on playing with the numbers.

It is a fact that there are more people who want to work than those registered as unemployed. These people are lumped in with those the government calls “economically inactive,” nine million of them and counting... Whether these people have been sanctioned or have just given up or they actually do have the means to support themselves will vary from person to person.

We currently pay interest on our National Debt of just under £50 Billion a year. (CI016F)

If we were not paying interest on the National Debt, the Government could create almost 4 Million new jobs at minimum wage! This would create a scenario where a vast segment of the population who want to work but cannot would be able to contribute to society.

When you divide £50 Billion by 2 Million you get £20,000. That’s more than someone being paid the London living wage would receive... (CI016D)

This leads me onto the next crazy idea but before I get there…

Imagine if we had full employment. Imagine what some of the consequences of that might be...
  • An immediate reduction in the welfare bill.
  • A massive workforce that could be mobilised to transform our country.
  • Young people with no current hope could be trained in useful skills, given experience and training.
  • Communities that are currently blighted by those who hang around with nothing to do but cause trouble would see a reduction in the problem.
The potential to utterly transform and improve the lives of millions exists in this idea. Could the Government create 2 Million or more jobs you ask? Why not? All that prevents us is lack of imagination or willpower.

If you’re interested, the ONS have provided a nice infographic on the recent state of employment which I've copied below. (CI016E)
 
There will be another crazy idea to fix the economy tomorrow...



Do post your own crazy ideas or feedback on mine in the comments below and sign up to my mailing list below to be notified of future posts.

Why should my crazy ideas have any relevance to the economy? I'm the author of The Great Scottish Land Grab, a novel that imagines a fairer future for Scotland where the poor are empowered to change their destiny. I'm director of my own limited company: Goal 31 Ltd and I've over seven years experience working for government and financial organisations. Also, just like you, I'm a taxpayer and for some crazy reason I think that entitles us to have an opinion and for that opinion to be acted on by the government.

As I wrote at the start, I am making my 100 crazy ideas freely available. It seems unjust to propose ideas to fix the economy and then prevent people from freely reading those ideas. 100 Crazy Ideas to Fix the Economy will be published once the craziness is complete.

I can be found on Twitter: @my100goals or on Facebook: http://www.facebook.com/my100goals. There's a short bio here.


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References:
(CI016A; ONS; http://www.ons.gov.uk/ons/rel/lms/labour-market-statistics/november-2014/sty-labour-market-statistics.html)

(CI016B; The Guardian; http://www.theguardian.com/business/2014/oct/15/uk-unemployment-falls-6-percent-lowest-lehman-brothers)

(CI016C; GOV.UK; https://www.gov.uk/national-minimum-wage-rates)

(CI016D; Living Wage Foundation; http://www.livingwage.org.uk/calculation)

(CI016E; ONS; http://www.ons.gov.uk/ons/rel/lms/labour-market-statistics/november-2014/sty-labour-market-statistics.html)

(CI016F; Parliament; http://www.parliament.uk/briefing-papers/sn05745.pdf)

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