Public sector workers want pay rises to counter the rising cost of living. The government faces a dilemma, because wages are rising in the private sector.
“You clapped us, now back us, fair pay now!”
This podcast once called 2022 the “year of the strike”.
“One, two, three, four, Rishi Sunak pay us more!”
But as half a million people take part in the biggest day of industrial action in a decade, it looks like 2023 could be about to outdo its predecessor. That’s because more and more public sector workers are asking for a pay rise and for better working conditions as the cost of living soars.
“We are overworked, underpaid and our job is only getting worse.”Guardian
This week it’s teachers, train drivers – and over 100,000 civil servants.
Next week it’ll be nurses, paramedics and midwives.
“What we’re saying to the government is, put some money on the table and we can invert these strikes. But if you don’t, this action will take place and it will escalate further.”Sky News
They’re asking for their pay to rise in line with inflation, which currently stands at over 10 per cent.
Civil servants have rejected a 2 per cent increase, while teachers and firefighters have declined offers of 5 per cent.
But with strikes escalating, the government isn’t showing any sign of backing down.
Here’s business secretary Grant Shapps talking to Good Morning Britain.
“If we were to say pay a 19 – one nine –per cent pay increase then of course, quite rightly, other very hard-pressed public sector workers might also say ‘what about us’. That will cost another £28 billion, and that means that we would end up in a situation where we would be asking people to pay more tax including the people that we’re paying more to, and everybody would be worse off again. So we’ve got to make sure we don’t get into this inflation spiral.”Good Morning Britain.
The government argues that raising wages for public sector workers now would make things even more expensive.
But… there’s a fundamental tension at the heart of that argument.
“Unemployment in the UK has come in as expected, at exactly 3.7 per cent, but wages are rising faster than at almost any time in the last two decades.”Bloomberg
Unlike in the public sector, wages in the private sector are rising
“In real terms though, pay fell 2.7 per cent, but what’s driving this wage growth? The biggest contribution was financial services, business services. The gap between public and private sector wages widened further.”Bloomberg
Private sector workers make up four-fifths of the UK workforce. And on average, if you take into account inflation, they’re paid around the same amount they were paid 12 years ago.
That’s not true for public sector workers, who have seen a real terms drop in pay. Teachers, for example, are paid about 13 per cent less; for nurses it’s 7 per cent.
So they’re asking the government to close that wage gap.
But private companies can afford to make cuts when their business is struggling, and adjust their goals according to the economic climate. They can be less ambitious, more cautious – and pay some workers more to retain them.
The public sector doesn’t have that freedom. It can’t change the number of people who are getting sick, or, really, the number of daily commuters. And at the same time it’s facing the same inflationary pressures as everyone else.
The one thing it does have some control over is wages, which is why the government is continuing to resist demands from trade unions and has even passed new legislation to make it harder for some workers to go on strike.
“These new laws mean that unions in some sectors will have to make sure that some staff don’t walk out on strike days. The government will ultimately decide what level of service is required, and if unions don’t comply, they could be sued.”Sky News
Data suggests that public sector workers are already leaving their jobs for better pay elsewhere.
And Rishi Sunak’s new proposal, the so-called “anti-strike” bill, may further alienate public sector workers who feel they have no other option but to walk out.
“The danger for the government is, by angering unions, it makes it even harder to do a deal, which means more potential walkouts in the weeks ahead.”Sky News
It might avoid a wage-price spiral but it risks a strike spiral – and that means difficult decisions ahead.
This episode was written and mixed by Patricia Clarke.