Discovering and discussing the hidden costs of recovery
Genevieve LeBaron - Vice-Chancellor’s Fellow
Daniela Tepe-Belfrage - Faculty Research Fellow, SPERI and the Department of Politics, University of Sheffield
Forthcoming seminars at SPERI will endeavour to rethink recovery in a radical way, taking gender and social reproduction fully into account
Thanks to over £500 billion of government bailout funds to banks and business, the British economy appears to be ‘growing’ again. National statistics indicate GDP was restored to £2.52 trillion in 2013, nearly back to pre-2007-8 financial crisis levels. Unemployment is down, from 8.4% at the peak of the crisis to 6% in July 2014. Corporate profits are soaring, and the richest 10% of British households now control 54.1% of Britain’s wealth. Economists expect the ‘good news’ to keep coming: in November 2014, the International Business Times declared that the UK, the US and India will lead global economic growth over the next two years.
But recovery for business and the wealthy has come at a steep cost for everyone else. Austerity policies and regressive redistribution have spiked inequality: while in 2014 the UK has seen the biggest percentage increase in millionaires in Europe, over 13 million people (about 1 in 5) now live below the poverty line. Credit Suisse recently declared the UK to be the ‘only G7 country with wider inequality than at the turn of century’, while Oxfam predicts that, by 2020, ‘one in four British children will be living in poverty’.
Many UK households are facing a subsistence crisis. During 2013-14, over 900,000 people received 3-day emergency food and support from the Trussell Trust foodbanks, ‘a shocking 163 percent rise’ over 2012-13. Furthermore, ‘a staggering 30% of UK adults have either skipped meals, gone without food to feed their family or relied on relatives or friends for food during the last year, whilst 40% of UK households have grown more food insecure over that period’ – a trend that will not be reversed by recent drops in food and petrol prices. A growing body of evidence suggests that the UK’s austerity-driven model of ‘recovery’ is prompting an ‘unprecedented decline’ in British living standards.
Many households and families with access to credit have turned to debt as a strategy to make ends meet. Individuals now owe a record high £1.43 trillion and UK household debt has ‘rocketed to 170%’ of national income in 2014. Prospects for repaying this debt look grim amidst falling real wages and a surge in part-time, short-term and precarious work and are not helped by the prospect of possible mid-term deflation.
Importantly, ‘recovery’ has also deepened inequality and exclusion along lines of gender, race and ability. Women and disabled people have been disproportionately affected by rising poverty, tax increases, cuts to public services and other measures such as the bedroom tax and unemployment. Ethnic minorities are disproportionately suffering in the job market.
Yet these gendered, racialised and class-based costs of recovery remain largely unacknowledged and unaddressed by policy makers. Indeed, the deepening everyday subsistence struggles of most of the UK population are obscured in national-level data on economic recovery and growth. The very concepts used by economists and policy makers – recovery, growth, consumption and investment and the economic assumptions on which these are based – are simply inadequate to capture differentiated experiences across gender, race, generation and space. In short, we are trapped in old concepts that maintain the old indicators of economic achievement and narrow our focus to the engineering of the level of debts, deficits, taxes and expenditure, while ignoring the broader social challenges.
To begin to address the social costs of the current recovery model, we need a holistic conceptualisation and vocabulary that can meet these key challenges. Contributing towards this end, SPERI will be collaborating with the Political Economy Research Centre at Goldsmiths, University of London, to host an ESRC seminar series over the next two years (2015-17). The series will bring together the newest generation of political economy researchers and practitioners to unearth the hidden costs of recovery and to generate innovative thinking to move us forward. Taking seriously the environmental, social and global contexts within which the UK economy unavoidably operates, the seminars will unsettle and challenge prevailing narratives and assumptions regarding recovery and growth. They will seek to advance an holistic conceptualisation of political economy to meet the biggest challenges of our times: skyrocketing inequality, the crisis in social reproduction, unemployment and stagnating wages, and the burgeoning environmental crisis.
SPERI will host two out of the six workshops in the series. The first SPERI workshop, to be held on 16-17 April 2015, will investigate the challenges faced by UK households. Bringing together academics and practitioners from UK charities and advocacy organisations, the workshop will analyse the gendered costs of recovery and the expanding crisis of social reproduction. Key questions include:
Which households have been hit hardest by the emerging economic paradigm?
How have households managed and mitigated the consequences of austerity, including increasing part-time work and hunger, and changing gendered patterns of work and reproduction?
What new concepts and techniques can we use to understand and represent the impact of ‘recovery’ on households and spheres beyond the formal economy?
Through discussion and debate led by early career scholars and practitioners, this workshop will endeavor to rethink recovery in a radical way, taking gender and social reproduction fully into account.
The second workshop at SPERI, to be held in April 2016, will uncover the impacts of the austerity-based recovery model on the domestic labour market. Bringing together scholars of both the ‘normal’ labour market and of unfree labour (including forced labour and human trafficking), this workshop will aim to build a comprehensive understanding of the ‘recovery’s’ wide-ranging effects on labor (in)security, (im)mobility and (un)freedom in the UK. Key questions include:
How has the financial crisis and associated recovery policies translated into labour market crisis?
How have workers managed firms’ attempts to cut labour costs by increasing agency and temporary workers, avoiding pension-fund obligations and contracts, and undermining rights to pay, benefits and bargaining?
Has austerity increased or exacerbated unfree labour?
What new concepts and techniques can we use to understand and represent the impact of ‘recovery’ on workers across the free-unfree spectrum?
Moving beyond orthodox indicators of labor market performance, like unemployment rates and GDP, this workshop will aim to build conceptual language that captures the full set of labour market challenges and can be used to mobilise towards systemic solutions.
Overall, the seminar series aims to generate new thinking about economic renewal, alternative recovery paradigms, and serious alternatives to the current economic malaise.
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