Well-being in an era of low growth

In this member post, Charlie Samuda gives us an update from the Future Shocks Policy Commission.

The 2012 YF Policy Commissions are addressing the problems of ‘youth in crisis’. Each of the commissions will deal with a specific political challenge faced by Britain’s young today.

The focus of the Future Shocks commission goes a little beyond the now to the problems this generation will face when they stop being young. Decades of slow growth, a growing population, an ageing demographic and environmental degradation – none of these are simply current issues, and none can be solved over the course of the next Labour government, nor the one after that. But we need to identify the shocks that are waiting over the horizon in order to develop policies that can mitigate the impact of these events before their effects are felt.

The first discussion to be tackled by our policy commission was the long-term consequences of the economic slump on social mobility and individual well-being. The event featured Danny Dorling, Professor of Human Geography at the University of Sheffield, who has written widely on social injustice in the UK. The stark conclusion of this discussion was that without policy intervention, the likelihood was that- with the exception of the very highest earners- this and future generations would suffer a deteriorating quality of life.

Taking the longer-term view, Danny pointed out that not only was it likely the gap between working- and middle-class households would grow, but also that there would be an even greater divide between those on middle incomes and those at the very top of the earnings scale. He also claimed that the more salaries increased, the harder it would be to fulfill the goal of full employment. Imagine a senior executive takes on ever longer hours; sure his salary increases, but he doesn’t feel any more fulfilled or work any more productively. In addition, the additional extra work he takes on prevents his organization taking on extra staff.

The difficulties preventing young people getting on the housing ladder have been well documented. However, if you look a little further into the future it is also easy to imagine a world where buying a house (and the security that comes with home ownership) is only open to those with very large amounts of capital, with the remainder of society being trapped in the uncertainty of renting. This thus magnifies the importance of inherited wealth. Those young people who will be able to buy in the future will not be those who only need ‘a bit of help from mum and dad’, but those who have significant levels of wealth passed over to them from a previous generation. It is not hard to imagine the secondary social consequences of such a starkly polarized housing market. The policy group discussed possible remedies in this area that could be achievable over the longer-term, and besides the obvious need for an extensive house building programme, a progressive tax on land was identified as a potential solution.

Finally, the future of skills and education was discussed. Looking at the next 20-30 years, the participants raised concerns about the increasing narrowing of skills occurring in the UK jobs market. We seem to be heading towards an economy where there is only a single – graduate – pathway to a career that provides a decent quality of life and financial security. Instead we should be developing a broader skills base that gives young people the option to be flexible with their further education. One policy proposal was for the government to grant a young person the right to 2-3 years higher education, redeemable up to the age of 30. This education voucher could be used for vocational or job specific training once the individual had identified a career choice they wanted to pursue. This would change the current system where education is ‘front loaded’ before young people enter the jobs market.

The aim of the policy commission is to identify solutions that enable governments to build resilience against these future shocks. With this discussion we are pleased to have begun this conversation. Our next event will discuss the challenges of building a sustainable economy in a carbon constrained world – where a changing climate and deteriorating energy security will shape policy choices. This event will take place on Tuesday 24th July, at 7pm in the Exhibition room at the Geography Department of University College London (entrance on Gower St).

We look forward to keeping to policy conversation going.

Charlie Samuda is a Young Fabians member