Thematic feature - unskilled workers

This article gives a brief overview of the industrial relations aspects of the topic of unskilled workers and unskilled work in the UK, as of February 2005. It looks at: national definitions of unskilled workers or work; the number of unskilled workers and workers in unskilled jobs, and the extent of unskilled work; employment and unemployment among unskilled workers; the regulatory framework; trade union organisation among unskilled workers; pay and conditions; recent initiatives to improve the situation of unskilled workers; and the views of trade unions and employers' organisations on the issue and its implications for collective bargaining.

In recent years, labour market developments have altered the demand for labour. Increasingly, employers are looking for adaptable workers, with more 'transversal' and 'relational' competences. The nature of skills required to be considered efficient in a job has thus evolved. In this situation, there is a growing risk of exclusion among unemployed workers whose profiles do not match the job characteristics needed, while the low-skilled or unskilled workforce is more at risk of unemployment.

In this context, in February 2005 the EIRO national centres were asked, in response to a questionnaire, to give a brief overview of the industrial relations aspects of the topic of unskilled workers. The following distinctions are used, where applicable:

(a) an unskilled job is a job which requires, for its proper execution, hardly any formal education and/or training and/or experience;

(b) a worker in an unskilled job is a worker doing such a job, irrespective of their level of qualifications or competences (especially under conditions of high unemployment, a significant share of those occupying unskilled jobs may be 'overeducated' for them, or 'underemployed'); and

(c) an unskilled worker is someone who has only the lowest level of qualifications or education (however defined).

The questionnaire examined: national definitions of unskilled workers or work, including those used or provided in laws, statistics or collective agreements; figures or estimates on the number of unskilled workers and workers in unskilled jobs, and the extent of unskilled work; employment and unemployment among unskilled workers; the regulatory framework, including any specific laws or collective agreements, and trade union organisation among unskilled workers; the pay and conditions of unskilled workers and workers in unskilled jobs, or for unskilled jobs; any recent initiatives to improve the situation of unskilled workers; and the views of trade unions and employers' organisations on the issue and its implications for collective bargaining. The UK responses are set out below (along with the questions asked).

Question 1 - Definitions and extent

(a) Please provide a definition of unskilled workers or work (see distinctions above) in your country. Are there any definitions provided in laws, statistics or collective agreements?

The terms 'unskilled worker' or 'unskilled work' are generally not used within the UK either in terms of laws, collective agreements or in statistics. Official government statistics use standard occupational classifications that explicitly avoid using the term 'skill', referring instead to 'routine' and 'semi-routine' occupations, ie jobs that require minimal levels of discretion. The more usual terms are 'low-skilled' work or work requiring minimal levels or no formal training or qualifications to undertake the job. This is normally described as below a 'level 2 qualification'. A 'level 2 qualification' is the standard normally expected of those completing lower-secondary education at 16 in the UK and equates to five good GCSE qualifications at grades A*-C or an equivalent vocational qualification (ie NVQ level 2).

(b) Are there any figures or estimates available on the number of unskilled workers and workers in unskilled jobs, and the extent of unskilled work. How have these figures changed in recent years - have changing skill needs or improvements in education/training systems led to a reduction in the numbers of unskilled jobs, unskilled workers and workers in unskilled jobs? Please break all figures down by gender where possible.

In 2004, it was estimated that around 12.3% of all employees were engaged in routine occupations; 15.5% of men, and 8.8% of women. A further 16.5% were working in semi-routine occupations, 12.6% of men and 20.6% of women. In total, this accounts for around 7.1 million jobs. Alternative data provided in table 1 below indicate the proportion of employees in occupations that are generally considered to be low skilled. Some 36.7% of all employees are in these occupational groups, accounting for over 10 million jobs. The Standard Occupational Classification changed in 2000, and, as a result comparable historical data are not available. However, it can be seen that the proportions working in personal services, sales and customer service have grown since 2001, while there has been a decline in process, plant and machining operatives. This reflects similar patterns found during the 1990s, when the number of low-skilled jobs in manufacturing declined, and jobs in the service sector expanded. Between 1992 and 1999, amongst the fastest-growing occupational groups in absolute terms were sales assistants, data input clerks, store keepers, receptionists and care assistants (see 'The labour market', P Nolan and G Slater, in P Edwards (ed) Industrial relations: theory and practice, 2003).

Source: Labour Market Trends.

In the UK, there are around 8 million people with either no or minimal level qualifications. Around 28% of women and 27% of men are at this level. Table 2 below presents statistics for England on changes in qualifications since 1997, and it shows significant declines in the numbers of low-skilled workers (ie those with less than level 2) from nearly 40% to one third of the workforce. These improvements are broadly seen to reflect major government initiatives aimed at improving the education and training system, expanding the number and types of vocational qualifications and tackling basic skills problems.

Source: DfES.

Although the statistics indicate a fall in workers with limited or no qualifications, the evidence suggests that there has been a much smaller decline in the number of low-skilled jobs. The national Skills Survey estimated that there were 2.9 million economically active people of working age who possessed no qualifications, yet there were 6.5 million jobs that required no qualifications to obtain them (see Work skills in Britain 1986-2001, A Felstead et al , 2002). It also noted that in 2001 around half of those qualified at levels 2 and 3 were in jobs that did not require these qualifications.

(c) Please provide figures on employment and unemployment rates for unskilled workers, compared with higher-skilled groups. Have unskilled workers/workers in unskilled jobs been particularly affected by industrial and company restructuring? Have new jobs created in recent years been filled by unskilled workers? Please break all figures down by gender where possible.

Participation in employment drops significantly with qualification level - see table 3 below. Only half of those without any qualifications participate in the labour market, compared with the national average of three-quarters . The lower-skilled are also subject to significantly higher levels of unemployment.

Source Labour Force Survey.

Regulation and conditions

(a) Is there a specific regulatory framework in your country concerning unskilled workers and workers in unskilled jobs (however defined)? Are there specific laws or collective agreements? Are there specific trade union organisations for them, or are they represented in 'normal' union structures. Have there been any changes in these area reflecting the changes referred to in question (b) under 'Definitions and extent' above?

There is no specific regulatory framework relating to unskilled workers. These workers are represented in normal trade union structures and are typically, although not exclusively, organised in large general unions, such as the Transport and General Workers’ Union (TGWU) and the General, Municipal and Boilermakers' Union (GMB), which also include skilled workers.

(b) Please provide any figures available for the pay of unskilled workers and workers in unskilled jobs, or for unskilled jobs, and the relationship of this pay with the average or with higher-skilled groups. Do collective agreements contain specific pay grades for unskilled workers, or workers in unskilled jobs? Please break all figures down by gender where possible.

There is a major education-related difference in hourly pay rates according to qualifications for both men and women - see table 4 below.

Source: Labour Market Trends.

For full-time workers, those in lower-skilled occupations earn between 56% (in personal services) and 80% (for operatives) of the average weekly wage - see table 5.

Source: Labour Market Trends.

Some collective agreements do specify rates for skilled and unskilled workers but it is increasingly rare to find terms such as unskilled. Instead job titles and/or grading systems (either numbers or letters) are used to reflect the different skill levels of particular jobs. These are collective agreements based either at company or workplace level.

(c) Are there any differences between unskilled workers/workers in unskilled jobs and higher-skilled groups in terms of access to other benefits, social security, pensions, etc? Please break all figures down by gender where possible.

Although social security payments are no longer related to prior income, occupational pensions are less likely to be available to those in lower-skilled occupations. In 2003, some 41% of men working full-time in routine and manual occupations were members of an occupational pension scheme, compared with an average of 55%. For full-time women workers, 34% from lower-skilled groups were members (compared with an average of 56%) and for part-time women workers the figure was only 23% (compared with an average of 33%).

Actions and views

(a) Please describe any recent initiatives taken jointly or separately by companies, public authorities (national or local) or the social partners (eg collective agreements) to address the situation and improve the situation of unskilled workers in terms of pay, working conditions, training, employability, unemployment etc.

The main initiatives to improve the position of low-skilled workers derive from a variety of government-led policies aimed at increasing the qualification levels of the workforce, and reducing basic skill problems. In addition, the vocational education and training system has gone through a number of institutional changes and restructurings (UK0110111F). Improving the supply of skills has been seen as fundamental to the UK’s economic success and key to raising productivity levels (UK0307105F). The initiatives undertaken since the Labour Party came to power in 1997 include:

• raising levels of educational attainment within schools;
• expanding the apprenticeship system to include foundation apprenticeships (level 2) (UK0405105F);
• providing public finance to young people to undertake vocational qualifications at levels 1 and 2;
• introducing pilot employer training schemes to provide free training and replacement costs to employers for time off for adults without a level 2 qualification (UK0302106F);
• establishing the Basic Skills Agency to raise basic skills in literacy, numeracy and language;
• introducing the New Deal for Skills, providing help to low-skilled unemployed adults to enter employment;
• setting up a Union Learning Fund that supports unions in partnership projects to develop work-based learning opportunities for employees;
• creating statutory rights for union learning representatives (UK0305102F); and
• introducing new legislation related to occupational licensing, ie minimal qualifications and training required to work in areas such as the security industry and care homes.

Very few of these policies (apart from legislation relating to occupational licensing) have focused on improving the quality and skill levels of the jobs themselves. The assumption has been that raising the capabilities of the workforce will have a knock-on effect on the jobs provided within the labour market. However, there have been other interventions that have had a direct impact on the pay and working conditions of this group of workers, in particularly the introduction of various forms of labour market regulation that have been applied to the whole economy, for example the National Minimum Wage (UK9904196F) and statutory regulation of working hours and holidays (UK9810154F). These kinds of policies tend to have a greater impact on those with fewer educational qualifications, as they tend to be in the lowest-paying jobs.

(b) Please summarise the views of trade unions and employers’ organisations on the issue and its implications for collective bargaining.

Traditionally, training matters have rarely been subject to collective bargaining within the UK. Institutional organisations relating to skills and training, such as the Learning and Skills Councils and the Sector Skills Development Agency, are presented as being employer-led with a very limited role available for trade unions.

The trade unions have enthusiastically welcomed the various initiatives relating to improvements in skills, particularly those based on workplace learning, such as union learning representatives and the Union Learning Fund. These have been seen as a new mechanism through which trade unions can increase membership, and play a greater role within the workplace, in the context of many years of union decline and marginalisation within collective bargaining. Employers’ organisations have also been positive in relation to many of the government’s initiatives on training and education. However, they have been hostile to the legislation giving legal rights to union learning representatives, while there has been a general concern to avoid any form of regulation involving minimum standards, licence to practice or statutory rights (for example to time off).

Comments

Despite a range of initiatives designed to improve skills at the lower end of the labour market, the UK economy still has a high proportion of both low-skilled workers and low-skilled jobs. The government has consistently insisted that the way to improve the situation is to raise education and training levels, and that the higher-skilled jobs will simply follow. Evidence seems to indicate that the number of workers without qualifications has declined quite significantly over recent years, yet the reduction in the number of unskilled jobs is considerably slower. This would seem to suggest that policies now need to be focused on improving the skill levels of the jobs themselves. However, the government and employers are extremely reluctant to move down this path, for example through the greater use of occupational licensing or through initiatives on work redesign. Given the centrality of skills to the government’s economic policies, it is likely that we will see more reforms to the education and training system but these are unlikely to deal with, and may probably exacerbate, the growing threat of over-qualification at the lower end of the labour market. (Caroline Lloyd, IRRU)