Lure of a lifestyle economy: High demand for labour comes as more workers decide to ditch their jobs, says RUTH SUNDERLAND
Noel Coward once claimed that ‘work is more fun than fun’.
It probably didn’t strike a chord with the miners and factory workers of his day, and it’s not necessarily what most people think as another Covid-blighted Christmas break limps to an end.
Many employees have made a resolution to change their working lives. At the moment, they have the upper hand over employers, according to James Reed, boss of recruitment company Reed.
Hiring: James Reed’s data suggests nearly half of employers will be looking to hire next year. Even the fear of a fresh round of curbs has not dampened the recruitment spree
This, he says, is the best time in 50 years to look for a job. Employees, he says, are calling all the shots: Demanding flexible and home working, safe in the knowledge that if one potential employer refuses, another will be waiting in the wings.
This inversion of the usual power relationship boils down to the basic economics of supply and demand. Unemployment was running at low levels before the pandemic.
When Covid-19 took hold, there were predictions of a sharp rise in joblessness, but it didn’t happen. The virus exacerbated long-standing shortages in several areas, the best known of which is for HGV drivers.
James Reed’s data suggests nearly half of employers will be looking to hire this year. Even the fear of a fresh round of curbs has not dampened the recruitment spree.
High demand for labour is being accompanied by a shrinkage of the workforce.
Part of this pre-dates Covid and is down to an ageing population. On top of that, many EU citizens who had been working here have gone home, whether because of Brexit, Covid or both.
The virus has prompted a lot of people to reappraise their lives, assigning their careers a lower priority.
In the US, around 5m people have voluntarily removed themselves from the workforce in what has become known as the ‘Great Resignation’. There is a similar trend in the UK: Reed calls it the ‘Big Quit’.
Some will see this as a healthy rejection of a workaholic, consumerist society, others as an outbreak of self-indulgence.
There’s nothing new about wanting to work less, or to do something lower paid but more congenial. What’s different is that the pandemic has, for many, provided a financial bounty.
More than £200billion of ‘accidental savings’ has been accumulated, mainly by better-off professionals, as a result of enforced lockdown thrift.
There are, of course, still plenty who don’t feel able to afford to take a step back, and many others who are selflessly working flat out. But again, the Big Quit is locking into a pre-pandemic trend.
Professor Douglas McWilliams of the Centre for Economics and Business Research observed as far back as 2018 the growth in the ‘lifestyle economy’.
People were already opting out of highly paid but demanding professions such as law or banking in favour of becoming artists or fitness instructors.
The lifestyle economy comes at a cost, for individuals and the Exchequer. McWilliams suggests we may have foregone around 5 per cent of GDP and £36billion per annum of tax revenue in the decade leading up to his study.
I don’t miss the brutal economic climate when I was growing up in the 1980s in the North East of England, when work-life balance hadn’t been invented because people were so desperate for work, any work. No one wants those days back.
But I do worry a little that WFH seems to have acquired the status of a human right in Peleton-riding circles.
Work may not always be more fun than fun, but the work ethic is still important for any individual or economy to thrive.