Next Scottish Government must make different choices to tackle scandal of in-work poverty

We need to see and hear an understanding that this is not a story about a failure of individual effort, but of our labour market. Too many people go to work, do jobs that keep our communities running, and still go home worried about whether they can afford the basics for their children.

That’s not an accident of the economy, it’s a choice we’ve made about how our labour market works. Bluntly, the next Scottish Government must make different choices.

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Low pay and inadequate hours

This is not about choosing between social justice and economic development, it is about recognising that they are inseparable. Leaving hundreds of thousands of working families in poverty is not a side-effect of growth, it’s a failure of economic strategy.

To reduce poverty and child poverty, we need to bridge the gap between the labour market that exists in Scotland and the one we want and need. That’s about understanding the massive challenges we have around low pay and inadequate hours, and their concentration within a few industries.

Nearly three-quarters of people in poverty live in a household where someone works in one of five sectors: hospitality, retail, health and social work, manufacturing, and administration.

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To reduce poverty and build the kind of Scotland we want to live in, we must focus on these five, and recognise the workers doing low-paid jobs which contribute so much to our quality of life.

From the staff at your favourite restaurant to the nursing home care assistant holding the hand of your loved one, these five industries cover a spectrum of crucial, life-improving roles.

It’s nothing short of a moral rupture that too many of the people working hard in these forgotten posts are still in poverty. We are, quite frankly, undervaluing them as a country.

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75 per cent of low paid are women

There’s a pervasive idea that people will escape poverty simply by ‘getting a job’, and once they have, they can progress and increase their incomes over time. But the evidence doesn’t bear that out.

About 10 per cent of the working population of Scotland have been low paid – receiving less than the Real Living Wage – for at least four out of five years. Around 75 per cent are women, and many are disabled or have caring responsibilities.

Frustratingly, it is unclear where our politicians are taking us on this issue. They seem to be unable to tell a coherent story about how we get from the labour market we have to the one they tell us they want.

Scotland should, of course, strive to be a leader in innovative industries such as precision medicine and quantum computing, but if there are still a quarter of a million kids in poverty after we do that, then what is this new economy for?

We can’t reduce poverty by having better growth and productivity alone. We need our politicians to make deliberate decisions to reject an economy that delivers the results we see today.

One of those decisions could be looking at the pathways for someone who is stuck in a role with persistently low pay to get a good job. For a working parent, if the only answer to that question is go to university for four years, we have failed.

Reshape the labour market

The public conversation is, at times, too focused on getting people into work when lots of parents are already in work.

Scotland’s devolved powers are not unlimited, but they are far from insignificant. The real constraint is not constitutional, it is a lack of political will. Parties need to be explicit about how they will use the levers they do have to reshape the labour market in favour of low-income families.

Take business rates. Scottish Labour leader Anas Sarwar is right to say the current system is broken, but fixing it shouldn’t just be about reducing costs for business, it should be about delivering better outcomes for workers and communities. If we are serious about fair work, our tax system should reflect that.

The same applies to economic development. Too often it is judged by how many jobs are created, rather than who those jobs are for, and whether they provide a route out of poverty. Public investment should be far more deliberately targeted towards creating decent jobs in the places and sectors where they will reduce poverty.

A huge prize awaits

Job progression also needs to be treated as a system challenge, not an individual one. Parties should be setting out credible pathways that work for parents, such as in-work training, paid progression routes, a recognition of skills already held, and transitions into better-paid roles that do not require people to step out of work altogether.

The prize if we get this right is huge. At the Joseph Rowntree Foundation, we modelled what would happen if 50,000 parents were supported into work over the term of the next parliament, and a further 20,000 who are already in work boosted their incomes through increased hours.

It would take 60,000 children out of poverty, cutting the child poverty rate from 23 to 14 per cent by 2030/31, a huge step towards the Scottish Government’s target of 10 per cent by 2030.

If people want to work and can work, they should be able to do so without living in poverty. Only a political party which can offer that is one that’s serious about delivering a better Scotland.

Jack Evans is senior policy adviser for Scotland at the Joseph Rowntree Foundation