British capitalism remains on the floor with wages falling and part-time working booming

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THE number of people estimated to be out of work in the UK fell by 133,000 to a ‘five-year low’ of 2.2 million in the three months to March, official figures indicate. The figure was boosted by a massive growth in ‘self-employment’ of all sorts, and also part-time working of all kinds, especially using zero hours contracts, and other forms of casual employment.

The unemployment rate now stands at 6.8% of the workforce, the Office for National Statistics (ONS) said. The number of people in employment of all sorts rose to 30.43 million, helped by a rise in the number of self-employed.

Average earnings however are still falling, with pay in the three months to March up 1.3% (excluding bonuses) from a year earlier. This means in reality that pay is still falling, with the CPI (Consumer Price Index) inflation rate at 1.6% and the RPI (Retail Price Index) rate of inflation now at 2.5%.

The number of people claiming Jobseeker’s Allowance in April fell by 25,100 to 1.12 million, mainly due to a draconian use of sanctions that deprived thousands of their allowance. The number of unemployed 16 to 24-year-olds fell by 48,000 to 868,000 – the lowest figure for five years, again the product of sanctioning.

In all, 283,000 more people did some work, which was the largest quarterly increase since records began in 1971. Self-employment reached a record high of 4.5 million, with the number of people working for themselves jumping by 183,000 in the quarter to March, compared with a rise of 375,000 over the past year.

Meanwhile in his review of the situation, Bank of England Governor Carney said that the economy had ‘edged closer’ to the point when interest rates would need to ‘gradually rise’, pushing mortgage interest rates higher, and intensifying the crisis of the middle class.

Carney went on to admit that ‘The Bank of England’s assessment of the health of the UK economy has not changed in any fundamental way over the past three months’. The Bank also noted that employment levels and average hours worked were both still below pre-crisis levels.

In February, the Bank estimated that the spare capacity was equivalent to 1% to 1.5% of gross domestic product (GDP), and that a major increase in productivity was what was required, meaning that the key to success is a massive increase in the exploitation of the working class, and that simply pauperising the population could not get British capitalism out of the mire.

‘The path of slack is uncertain, and there is a range of views on the Monetary Policy Committee. For a given growth profile, it will depend heavily on the timing and strength of the rebound in productivity growth,’ the chief banker emphasised.

Unite general secretary Len McCluskey commented on the latest figures that: ‘The big concern regarding self-employment is that it is precarious and provides an irregular income. It also forces people out of social provisions enjoyed by those in permanent jobs, such as pensions and paid holidays. People become more vulnerable and worse off.’

The TUC commented: ‘Ministers shouldn’t kid themselves that we are becoming a nation of budding entrepreneurs. You are far more likely to be a self-employed hairdresser, care home worker or ebay seller, than run your own business and take-on staff.’

The GMB said that ‘GDP per head is still 5.8% below 2007 levels, which is the root cause of average earnings being down 13.8% in real terms since then’.

British capitalism remains in a desperate crisis, whose problems can only be kept at bay by creating a nation of paupers and zero hours workers, with GDP down 5.8% per head in real terms compared to 2007.

The task of the hour remains the liberation of society from this paupers straightjacket that capitalism is imposing on it. What is required is an enormous development of the productive forces that is well beyond the capacity of crisis ridden capitalism.

The need of the hour is for the TUC to be made to call a general strike to bring down the coalition and bring in a workers government that will develop the productive forces through nationalisation and economic planing.

The only way out of this crisis is by going forward to socialism.