Corporate power combined with suppressed union activities is widening the wage gap to desperate levels of unfairness, says Michael Meacher
What is an employee worth? Whatever the market pays is the conventional answer.
But the market is not based on merit or justice — it’s based on power relations.
Those who have the power will exert it to get more and more, while those who have little or no power will get squeezed and pushed down even further.
Against that background the fact that 1,000 companies — out of 4.9 million in Britain — including 18 FTSE-100 companies, have now committed to pay the living wage or above is seen as seen as a triumph.
The chief executive of global communications company Ogilvy and Mather chanted: “We will wear our badge with pride.”
Really? The living wage is all of £7.65 an hour, £8.80 in London, and not paying it before now should be a badge of shame.
Nor with this minimum rise in wages will the ratio between top and bottom incomes in big companies like Ogilvy and Mather alter much — it will still be at least 185:1. The distribution of wages is still desperately unfair.
Just how unfair it is is shown by how that ratio has changed in the last half century.
Today chief executives of the FTSE-100 companies take home on average total remuneration of £4.5 million, or £86,540 a week.
An employee in those firms getting the living wage would take home £283 a week.
The ratio therefore between the chief executive and his living wage employee is 306:1. Half a century ago it was 40:1.
The near eight-fold increase in that ratio has nothing to do with a more brilliant perform
Census study blows right-wing immigration myths out of the water
Migrants from the EU have a lower rate of unemployment than the UK-born population, according to an analysis of 2011 census data just published by the Office for National Statistics.
They also make a net contribution to the British economy while the UK-born population is a net cost to the economy.
This is a stunning conclusion when the prevailing ideology, persistently promulgated by the Tories and the right-wing tabloids, is that EU migrants are largely “benefit tourists.”
However, what detailed analysis of the figures shows, as opposed to anecdotes, is that migrants from the 10 eastern European countries that joined the EU in 2004 contributed nearly a net £5 billion to the UK in the decade to 2011 while those from the original 15 EU members generated a net gain of £15bn over the same period.
The analysis further showed that EU-15 migrants contributed 64 per cent more in taxes to the UK than they received in benefits and migrants from the eastern European EU members (Poland, Czech Republic, Estonia, Hungary, Latvia and Lithuania) contributed 12 per cent more than they received.
However, both migrants from the EU and the UK-born population had a higher rate of employment than migrants from outside the EU, and it is the latter who make up two-thirds of the England and Wales non-UK-born population, about 4.2 million out of 6 million.
Polish people were the most likely to be in work — 81 per cent were employed compared with 69 per cent of the UK-born population.
The lowest employment rate was for Chinese and Bangladeshi migrants, though 76 per cent and 40 per cent respectively were students.
The research also found that EU migrants are significantly younger than the average UK-born resident and also more likely to have a degree.
Significantly, it was also found that Britain tends to attract far more skilled immigrants than other EU countries. Polish immigrants to Britain, for example, had much higher levels of education than those in Germany.
The study also found that a greater proportion of recent migrants are highly qualified. It was striking however that the researchers calculated that, as opposed to EU migrants, the non-EU migrants between 1995-2011 involved a net cost to Britain of £118bn, partly due to the higher numbers of children and lower employment rate.
By comparison the EU migrants over the same period brought a net gain of £4bn.
That certainly highlights how far the Ukip argument about EU immigration has falsified the evidence and given a slant to prevailing views which is wholly inaccurate.
Michael Meacher is Labour MP for Olham West and Royton. For more of his writing visit his blog.