Coronavirus-poverty, precarious work and the need for a universal basic income

Coronavirus-poverty, precarious work and the need for a universal basic income

Brian McDonough

We are only at the start of the coronavirus pandemic, yet signs of the economic consequences to this global killer are already far greater than the economic recession of 2008. It does not take an economist, or sociologist, to predict that, apart from the deaths and deep sorrow caused by this virus, the economic consequences for many peoples’ livelihoods are dire. The seeds of this economic crisis are presently taking root. Right now, and for many months to come, many people will be subject to what I can only describe as ‘coronavirus-poverty’. That is, the economic consequences of the coronavirus will bring about hardship, impoverishment and in some cases, destitution. The knock-on effects of not being able to go to work, of losing one’s job, of businesses or self-employed not having any customers, consumers or clients, combine to limit the opportunities and life chances of individuals and families. But there are solutions.

As this virus has changed the world as we know it, government policies across the globe have changed too. For example, in unprecedented times, the British government promised £350 billion to support businesses during the coronavirus outbreak. On top of this, business rates were cut, funding grants of up to £25,000 were set up and employees on the HMRC PAYE system are promised up to 80% of their income for staying off work during what people hope is the worst part of the outbreak.

However, the coronavirus has also highlighted the concern that precarious work is integral to a growing divide between the richest and poorest in society. Part of Britain’s workforce is highly paid, highly skilled with properly contracted employment. But millions of other workers across Britain have insecure, low-skilled and low-paid work. Precarious work adds nuance to the argument because it cuts across all social classes and types of employment. The divide, during the current coronavirus outbreak, is visibly evident from the two groups we have seen this week in Britain: those who are fortunate enough to work from home, and those who are taking health risks of going out to work, avoiding a loss of income which is detrimental to their livelihood. Coronavirus-poverty is hitting precarious workers hardest, for they inhabit a grey area of society which policy fails to support or protect.

New policies to secure income to the self-employed are truly welcomed, but working out who gets what, is a complex process, admitted the government. As a result, payments could go to only ‘one in three of the five million who work for themselves’ some reports have suggested. Precarious workers include cleaners, childminders, painters, porters, delivery workers, and low-skilled administrative work. But they can also include university lecturers on ‘zero hour’ contracts, self-employed taxi drivers, hairdressers, actors, construction workers and a whole host of other workers, millions of them, who do not have secure, stable contracts of employment and will not receive the financial recompense others will get.

The diversity of these jobs means that these workers, or the ‘precariat’ (precarious proletariat) as the economist Guy Standing (2017) calls them, can be understood as a distinct group or class which are global. During the 1980s, some insecure and unstable work was badged as ‘McJobs’ to describe the precarious, low wage and low prestige jobs carried out in various sectors across Britain. The term was first coined by a sociologist in an article in The Washington Post (US) entitled: “The Fast-Food Factories: McJobs are Bad for Kids’ (1986). The author, Etzioni, argued that such jobs were so highly routinized and tightly controlled by management, that McJobs provided little autonomy or freedom for employees to fulfil their potential.

Later, in the 1990s, fast-food chains were again used as a metaphor for describing the precarious kinds of work across British society. This time it was the frequent use of the term ‘Burger King contract’ used to denote the poor employment contracts many workers in the service sector had become all too familiar with. Often giving out ‘zero hour’ contracts, employers could hire and fire at will, with employees having little ability to maintain stability over their income and consequently their lives. Twenty years on, these unstable and insecure forms of employment not only still exist but have become even more widespread, with Britain one of the leading countries to willingly support this form of contractual agreement between corporate organizations and the workforces they precariously recruit.

Take for example thousands of workers of the global taxi company Uber, who are ‘self-employed’, and do not get the same rights as other workers, including the right for employers to pay for social security, disability and unemployment insurance, the right to paternity or maternity leave, the right to sick pay, retirement benefits and paid holiday. As self-employed workers, they do not even have the same opportunities to be part of an organized trade union.

The government are themselves aware that their current spending bailout will not reach everyone in British society. The Chancellor, Rishi Sunak said: “We will not be able to protect every single job or save every single business”. This candid statement reveals the weaknesses of policy implementation which does not go far enough to look after the heart and soul of the British economy – those for example whose jobs involve serving, caring, building, and teaching. None of what the Chancellor offered can help those most precarious – workers, who, for whatever reason, get by with cash-in-hand income. These might include farm laborers, care-workers and baby-sitters, delivery teams and waiter/waitresses who live off their ‘tips’, pub workers and cleaners across the country – many of whom rely on cash-in-hand payments. They are invisible to the British government, but they will suffer from coronavirus poverty, now and for the foreseeable future.

What are the solutions to precarious work and coronavirus poverty? Just four weeks ago, on the 27th February this year, Solent University (in Southampton) held a book launch for my new co-authored text, Universal Basic Income (2020). The book introduces the idea of a regular, cash income paid to all in society, regardless of whether individuals are rich or poor and not dependent on if you work or not. The idea has been called a ‘citizen’s basic income’ (see Torry, 2016), ‘universal grant’, ‘existence income’, or simply just a ‘basic income’ (see Standing, 2017).

Little did anyone know at that time, that just weeks later, MPs, community activists and mass numbers of the public would be calling for such a policy to be introduced. For those who think a basic income is a radical leftist idea, they are hugely mistaken. Universal basic income has been encouraged by both left and right of politics. The executive director of the Adam Smith institute, Sam Bowman, has been recommending one for many years. He said it would (1) address in-work poverty, (2) reduce complexity in the welfare system, and (3) facilitate other reforms that would raise overall living standards.

A universal basic income would not cure all financial difficulties faced by people and organizations during this global pandemic, but it would offer a safety net to keep people out of severe forms of poverty. It also provides dignity and self-worth, since all citizens by right would receive a regular payment, without form-filling or begging for handouts from the state.

The philosophy behind a universal basic income is that it is more than just an income, but a new way of life, where people are not reliant upon their employers to put food on the table. They can get by, if necessary, with a basic income that takes them above the poverty line. After years of austerity in Britain, with the previous Prime Minister Teresa May infamously claiming, ‘there’s no magic money tree’, we finally see the government pulling out large sums of money to rescue the economy. But like past policy interventions, there will be winners and losers, with hundreds of thousands of people not seeing any financial help come to their rescue. That’s why a universal basic income is different. It is for everyone. We all benefit. Nobody should be left out.

References:
McDonough, B. (2017) ‘Precarious Work and Unemployment in Europe’. Chapter in Isaacs, S (ed) (2017) European Social Problems. Routledge: London.
McDonough, B and Bustillos Morales, J (2020) Universal Basic Income. London: Routledge.
Standing, G. (2015) The Precariat: A New Dangerous Class. London: Penguin.
Standing, G. (2017) Basic Income: And How We Can Make It Happen. London: Penguin.
Torry, M. (2016) Citizens Basic Income: a Christian Social Policy. London: Darton, Longman and Todd.

 

Brian McDonough is Course Leader of Sociology at Solent University and writes about social inequalities at work. He recently published Universal Basic Income (Routledge, 2020).

Image: Marc van der Chijs

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