Low-paid jobs 'bad for economy'

More people are being forced into volatile, low-paid jobs, which threatens the stability of the economy, according to a new report.

More than one in five workers are now on low pay, the report found
More than one in five workers are now on low pay, the report found

Over one in five workers are now on low pay, with more employed than unemployed households in poverty, it was found.

The report by research group Centre for Cities and the Joseph Rowntree Foundation said the gap between good and poor quality jobs had polarised.

Cities in the North East were particularly at risk, with a third of employment in Sunderland and Hull being low paid, while in Grimsby, Blackpool and Doncaster, one in four workers earned less than two-thirds of the median national wage, the study said.

Alexandra Jones, chief executive of Centre for Cities, said: "There's no doubt that low paying jobs have always existed and that some cities continue to see significant growth in high paid jobs.

"But what has changed over the past few decades is that, in many cities, the pathways to upward mobility have been severely eroded, as their jobs markets polarise and the stable jobs of the 'middle' begin to slip away.

"For far too long, successive governments have focused on the number, not the quality of jobs being created, but the trend towards low paying, insecure employment is bad for workers, bad for cities and bad for the economy."

Julia Unwin, chief executive of the Joseph Rowntree Foundation, said: "Earlier research for JRF has demonstrated the striking growth in working families living in poverty.

"Economically weak cities are home to increasing concentrations of poor working households, whilst two-tier economies are emerging in our more successful urban centres.

"Job quality is a burning issue, particularly in low-skill, low-wage sectors such as retail, hospitality and care.

"As more cities start leading on growth strategies they must respond as part of this work to the shifts occurring in the labour market.

"We need new thinking if we are to crack the problems around training, progression at work and job security that seem to keep increasing numbers of people stuck in entry level jobs."

Three out of five jobs in London will be high paid in a decade, but with soaring living costs and house prices, lower paid workers will find it increasingly difficult to afford to live in the capital, the report concluded.