Wednesday, 29 June 2016

My Take on Brexit - Why Labour needs to stop in-fighting and come up with a credible industrial and employment strategy

As a Remainer I was desperately disappointed at the Brexit vote, but we are where we are and we have to get on with it. However, the issue that strikes me most now is how Labour have failed to address the issues that clearly resulted in so many Labour supporters outside London voting for Brexit and how there seems to be no clear strategy for moving forward.

In the run up to the referendum, the debate was entirely sterile, arguing around tightly defined topics with no real thought about how to plan for a new model that would provide an engaging vision of the future Britain within the EU.

If I start with immigration, part of the issue, as I see it, is the large number manual unskilled and semi skilled jobs that have attracted so many EU migrants. The root of this problem, from my perspective, is the failure of the UK education system to train up the UK workforce appropriately and the consistent failure of UK Governments to develop an industrial strategy that encourages the growth of skilled and semi skilled employment.

The Work Foundation generates some fascinating statistics about both employment and under employment and the skill levels of our workforce. The push for growth in the University sector suggests that by 2024 there will be 5 million more people with higher education qualifications yet only 2 million growth high skilled jobs. At the same time there are no signs of any growth in those people holding NVQ3 qualifications. According to the Chartered Institute of Personnel and Development in 2014, 58.8% of graduates had jobs which did not require a degree. It strike me that some of these semi skilled and trades jobs are being filled by EU migrants simply because we haven’t trained enough UK staff with the correct skills to fill them. We have created the vacuum which EU migrants have filled. That is not their fault - they are fulfilling a need.

To my mind you can look at the situation we are in in two ways; welcome EU migrants and let the underskilled and underemployed continue to resent our EU and see vindication in the Brexit vote or set out a much more comprehensive plan to reskill our national workforce giving them a better chance to compete for those semi skilled and skilled jobs, something that will be essential if we opt for the "Norwegian" option/EEA membership which will still require free movement of labour.

In January this year Sir Michael Wilshaw roundly condemned the Further Education sector yet it is clear that government funding to this sector has been cut repeatedly, creating and perpetuating the shortcomings of the FE sector  An example of this is the skills shortage in the construction sector. Indeed back in January David Thomas of Barratt Developments described the skills shortage as “the number one challenge for housebuilders”. With a strong, vibrant FE sector producing skills workers for sectors that need them we could be filling that vacuum not making it worse.

I was discussing this with my sister, a retired teacher. Before retiring she was responsible for for NVQ courses at her secondary school. At its peak they were running 23 separate NVQ courses giving children recognised and  desirable qualifications and a direct gateway into good quality jobs. Change of government, change of policy and those courses disappeared denying many children an opportunity to succeed, an opportunity to enter a career path, an opportunity to earn and contribute to society.

There is also a massive problem of underemployment, people who are in part time work but who would like to work more. Again the Work Foundation provide statistics on this:

The table below summarises the main findings.
2015 - Q4 
Unemployment rate (%)
Under-employment rate (%)
 Young (16-24)
That suggests there is still a lot of slack in the economy. Short term underemployment has become entrenched as long term underemployment because the government has failed to address and allowed employers to exploit it with zero hours contracts. It may give employers some flexibility but it is a devastating waste of resources, especially young people who could be contributing so much more to the economy and reduce the burden on the social security budget.

To my mind we should be stimulating the economy to take up that slack, to take people out of low pay and benefits and to give them spending power that will in turn help stimulate growth. But this takes us to the second area where politicians have failed.

If you look at the Government’s Industrial Strategy page it sums up  that we don’t really have a proper strategy, just a few initiatives which don’t seem to address the underlying issues of British industry in a cogent and coordinated fashion. We need a coherent long term plan which sets out a clear path to growth and fuller employment with decent skilled and well paid jobs served by a well trained and well paid staff. Both Chuka Umumma and Vince Cable talked about the "deafening silence" of this government's industrial strategy

From a personal perspective, at a very micro level, I was pitching for a contract in Australia. To get round the red tape necessary to compete in the Australian market I rang up the UKTI team, a Government department to help exporters, and asked if they could help answer a fewer questions relating to employment and contract legislation. Having been put through to the Australia desk I was told they only supported defense contract bids. So no help there. As it turned out I won the tender but with no help whatsoever from this government. Maybe I was just unlucky but I suspect that departmental cutbacks and a lack of clear strategy were contributing factors to the lack of support.

The Tories have demonstrated over the last 6 years that they have no ability to deliver a new vision for Britain, just short term gimmicks and knee jerk reactions that have culminated in this disastrous situation we are now faced with. The Tory party are at war with themselves and that is all they are focused on at the minute.I have no belief that they will ever take a long term view about our economy and our role in th world market. It is all about short term tactics and point scoring off one another.

However, seem no better. If all those Labour MP’s were to stop messing about calling for votes of no confidence in Corbyn and actually come up with a clear plan of what Britain could look like, how we could rebalance the economy and generate well paid skilled jobs for well trained UK residents, then the issue of migration, and our lack of confidence in the EU would drop away much as it did in the early 2000's when the economy was storming along, would become much less of an issue. Indeed, they might actually start to win over a much greater majority of the electorate. Ignoring what 17 million people have said is pointless because it means you will never get re-elected. What we need are solutions that address those concerns but in a constructive and positive manner that benefits everyone not in-fighting that benefits no one.

Bill Clinton coined the phase, "It's the economy stupid" and that holds good today as it ever did. The Brexit vote has just made that more difficult but now more than ever Labour has to come up with a strong and credible industrial and employment strategy that will help get people back into good quality well paid jobs.