Equality pt.1 - Measurement

The first in what may turn out to be several post on equality. This will look at how we measure a few things to make the government and, by extrapolation, society at large, feel better about itself.

We keep being told that society is getting more equal, that things are improving for those least well off. I'm not entirely sure about this! One of the factors used to back up this good news, especially for companies listed on the main stock markets, is that the top bosses of these companies make a lower multiple of the company's average salary than they used to. This should be good for all involved shouldn't it? That is what most people will think until you look at the details of how this has come about. One of the favorite tricks is to outsource services. These will always be those at the bottom end of the scale - the cleaners, the hospitality staff, the security staff. I always find it strange that company boards often consider these unskilled jobs. My apologies - I'm getting distracted from my main point which is that these companies take all there lowest paid jobs and outsource them to a service company rather than lifting up the wages of those performing these tasks. There are two effects of this. First, those whose work is outsourced will often find themselves worse off, stuck on minimum wages and with insecure zero hour contracts with minimum benefits. The second effect is that the company that carried out the outsourcing will have dropped a large percentage of those whose salary was in the lower brackets, in some cases lifting the company average salary by 25-30%. The directors can all give themselves a pat on the back and vote themselves a large pay increase knowing that the overall factor compared with the average salary at the company will be lower than it was, so they have contributed to a more equal society. Another figure used to show society is getting more equal is to look at the average salary figures for those in full time employment. These figures are a bit of a myth. First, it looks at the mean average salary, the figure arrived at by adding up the salary of all those employed full time and dividing that by the number in full time employment. This has risen quite dramatically in recent years. But, if you look at the median average, the salary at which half the number of people earn above and below the amount, this has barely moved. So yes, the very lowest paid have had an increase in their salary, but this is squeezing the lowest paid into a narrower band rather than a general increase in the salaries of those in the bottom half of society. And remember that this only covers those in full time employment. Those who are on zero hours contracts, those who get paid piece work for deliveries or boxing up, etc... do not get included in this. Most of us will not be in a position where we can change this, and often those that can and have the positions of power will be only after more profit for their company and therefore bigger bonuses for themselves. If you are in a position to advise on the outsourcing of work I ask you if can justify it to yourself of moral grounds as well as economic ones. Maybe we should be looking at different figures to see how equal we are? Or changing the way some are calculated. For salary markup for top bosses of stock market listed companies it would be interesting to see a pay per hour comparison between the lowest paid employee (directly or indirectly employed), and the total take home (including bonuses and benefits) per hour equivalent of the senior management and board members. I think this make most interesting reading, especially given that the pension payments made to directors and senior managers of listed companies will far exceed the the total salary of those that clean up after them or feed them. How about the number of people in work that need to rely on benefits to get by on a week to week basis. Surely if everyone is being paid a decent living wage then this should be dropping, not increasing. Or the number of people having to rely on free school meals or food banks? I find it worrying and saddening that in this day and age, living in a country that is in the top 7 economies in the world, that there are those in work that need to rely on handouts and charity for such a basic essential.