18 January 2016
New research by the TUC has revealed that if policies do not change, midwives, teachers and social workers will see a drop in their real wages of more than £3,000 by 2020.
Pay cuts for public sector workers mean earnings are falling behind inflation and the 5.4 million people working in the public sector are seeing their incomes being slowly eroded.
By the end of the decade, nurses, firefighters and border guards could lose more than £2,500 a year, and ambulance drivers’ real wages could drop by over £1,800.
Public sector workers account for nearly one in five of all employed people in the UK.
“Government pay restrictions hurt staff in overstretched public services, and make it even harder to recruit good people. Particularly at a time of crisis in the NHS, we need to be recruiting the best people for the job,” TUC General Secretary Frances O’Grady said.
“It’s time for ministers to give public employers the freedom to negotiate with unions for pay in their sectors,” she added.
Indeed, the Institute of Employment Rights is calling for a new framework of labour law to shift the focus from statutory minimums such as the minimum wage to collectively agreed pay and conditions across sectors.
In our Manifesto for Labour Law, which has been adopted by the Labour Party, we propose that businesses negotiate with trade unions at both a sectoral and enterprise level so that workers and their bosses can pull together to create industries that are successful, productive, and fair.
Recent research from the Institute of Fiscal Studies additionally found that as real wages fall, the welfare state is having to work harder to keep families afloat and offset increasing inequality. As a result, the public purse is subsidising poor wages through tax credits and in-work benefits and leaving fewer funds for public services. We argue that by incentivising employers to provide fairer deals to their workers instead of relying unnecessarily on the welfare state, there will be more money available for the adequate facilitation of public services.