Wath on Dearne used to be home to Cortonwood Colliery.   

In the 1970s it was a mining town, part of the mighty Yorkshire Coalfield.   A similar place to where I grew up in the villages to the East of Durham City.  In fact I am picking on Wath as a subject because it is similar enough to where I grew up to draw analogies, without being so close that people can recognise themselves

We are accustomed to viewing pit villages or mining towns as bleak places, but when the Durham and Yorks coalfields were in full operation wages were good, typically much higher than other manual trades, and the work carried respect.  During the 1970s the wage share of GDP rose and the capital share of GDP fell sharply in the UK, and miners were, often for the first time, buying cars and taking foreign holidays.    The cars were all British made; Vauxhall Viva, Ford Cortina, Morris Marina.   My maternal grandfather, who worked in the Durham coalfield, took his first and only foreign holiday in this era – a trip to Sorrento.

As you can tell by the street sign from near where I grew up in Durham many mining communities were very left wing.  It was however a form of left wing politics very different to current Labour Party policy.  People relied on themselves first, then the local community, who would rally round in case of hardship. The Union was next and the State last when it came for help. Support for the NHS and the Welfare State was absolute, but it was communities which mattered most.   

These tight knit communities did however have a downside – they were fiercesomely conformist, which penalised individualism and often ambition. Not much fun for a pretentious smartarse like me.

At times this conformity could be repressive – a man’s place was in heavy industry, a woman’s place was in the kitchen, a gay person’s place was in the closet and an Asian person’s place was working in a takeaway, if they had a place at all.   Because work places were all male, and underground, you could say what you liked without fear of censure, no matter how provocative or offensive.  You could meet people in any pub who were to the left of Tony Benn on economic policy, and to the right of Bernard Manning on social policy.

And then Thatcher came and destroyed the entire industry and wrecked these communities.  And Billy Bragg wrote songs about it for people who had largely never visited the places he was writing about.   The closure of Cortonwood Colliery in Wath was where the Miners Strike started, and that was all I knew about the town.

I started visiting Wath on Dearne nearly 10 years ago on business.  Given what I knew about former mining towns in the North East I had pretty bleak expectations.

What I found was a remarkably buoyant local economy, thanks largely to retail and the internet.  The most visible company is Next, who have a large campus there. 

Next started as Hepworths Tailors in Huddersfield.  In the 1960s they spotted an opportunity to grow the business selling suits to Mods. The brought in Hardy Amies to oversee the collection, and started offering consumer credit to young white collar workers.   

They ended up providing credit and account management services for lots of other companies, and government departments. The bit of government I was working for outsourced some call centre work to them, which they were very good at.  I tried to find a picture of the original Hepworths /Hardy Amies 1963 collection, but all I could find was this photo of the launch of the 1966 Hepworths menswear range, which is pretty fantastic. If anyone has one of the cloaks I would happily pay good money for it.

Most of the work that Next does in Wath is warehousing, distribution, call centre and back office, but there are some higher level business functions like trend prediction and campaign planning.   On the back of Next moving to the area other similar business set up too, including ASOS, taking advantage of good transport links and a talented local workforce.

While the buildings were modern the actual workplaces I visited were still surprisingly segregated.  The call centres are almost exclusively female, the warehouses exclusively male.   There were plenty of Asians, as you would expect in Yorkshire, however they were concentrated in technical graduate roles – programming the dialers, working in IT.   It was hard to assess the extent to which gay people were represented in the workforce, other than they were much more visible than in the mining industry.

The whole area looked like a New Labour success story.   Astute investment in infrastructure and education, combined with relocation grants, had brought jobs to a former mining area.  Some of the funding came from the EU.  It was one of the most successful examples of regeneration I have ever seen.  Employment opportunities for woman had increased, as had employment for ethnic minorities. 

The only group in the work force whose prospects had diminished were men.   Manual labouring jobs for men with high status, good money and respect were gone, and replaced by lower status, insecure employment.  There was also a more subtle difference to the world of mining – people were more closely managed, and managers were keen to enforce corporate values.  The freedom to say what you wanted no matter how offensive which came from working underground was gone, and replaced by a business culture where you had to watch what you said, particularly with regard to race and gender.

In fact the economic order of the town had been turned upside down, with male manual workers at the bottom of it, where they had been at the top a generation earlier.

These economic changes had little to do with the EU, other than as a source of funding for infrastructure. They had nothing to do with immigration. These changes did co-incide with an increase of immigration into the UK, so it is easy to see why people would make the link, particularly with a number of newspapers encouraging that view.

Wath still returns Labour Councillors and a Labour MP, but the Local Authority has 13 UKIP Councillors and voted to leave the EU.   

It is hard to see how the changes that leaving the EU will bring will do anything to make the lot of male manual workers in Wath better.    It is easier to see how automation and technological change will make manual jobs like warehousing and distribution less well paid and less secure. 

The economic changes unleashed by Margaret Thatcher were easy to spot – you could see them in closed factories, dole queues and in the pop charts.  The economic changes of the years since have been just as profound and dislocating, but because they happened more slowly, and without such a clear set of policy announcements they didn’t register with people who weren’t directly impacted by them.  The decisions weren’t exclusively taken by national politicians, but by an assortment of local councillors, remote business bosses, EU structural fund allocation committees, corporate investors, transport planners, and above all customers who switched to e-commerce rather than make do with the choices in the local shops.

No-one wrote a pop song to alert us to these changes, or to condemn the people who unleashed them.  I don’t think they ever will.

This is the UK Labour Force Survey.  When you read that Unemployment has gone up or down the original data largely comes from this survey document.   Most people have never seen it or participated in it, because you have to be drawn at random to be part of the sample.  To keep the sample size small, and the costs down, LFS work on a rolling weighted 3 month average rather than a proper monthly data set.

If you were surprised by recent announcements that the UK has the lowest unemployment since the early 70s then LFS is the source of this data.  If, like me, you felt that the government’s claims on unemployment were a bit far fetched this is the place to start.

The Labour Force Survey was introduced to the UK in the early 70s when we joined the EU, in an era when work was very different to now – men worked, women stayed at home, hours of work were stable, people had one job and self employment/small businesses were very much rarer than now.  This is no longer the case – since the credit crunch 45% of new jobs created have been self employed, since Brexit more than half.

You may have spotted this is an old LFS.  The current one is apparently a secret…..

LFS became the main way the Government uses to measure unemployment in the UK in 1997 when Labour came back into power. Previously we had used a narrower measure, the claimant count, which had fallen into disrepute due to political manipulation in the 1980s and 1990s to massage the unemployment rate.

This is what the Office of National Statistics has to say about the Claimant Count data at the moment:

Looks like DWP are back to their old tricks.

When I was a Civil Servant I was familiar with the ways that data about employment and unemployment could be presented to paint a rosy picture – for example presenting a rise in the number of people leaving the labour market as a fall in unemployment.  If I am honest I took for granted that all Governments present data like this to make a case, that well educated people knew that, and could form their own judgements.   

While I was setting up the Distillery I was picked to be part of the Labour Force Survey sample cohort.  The experience isn’t great, particularly if, like me, you don’t like paperwork and bureaucracy.  I was part of the phone cohort, which meant a series of lengthy phone calls with a researcher, most of which started “thinking back over the last week did you….”. 

The version of LFS I did was 220 pages long, and it me took the best part of an hour to complete. This was repeated 5 or 6 times. 

What it made me realise is how hard it is to capture the distinctions between work, unemployment, self-employment, and under employment using a survey methodology which was created most of my lifetime ago.   

If your hours of work vary week by week you have to wait until page 70 to explain this, and the act of explaining adds time onto the survey.   If you have a second job with variable hours this is somewhere past page 80.

At the time I was setting up my business, and my hours were irregular. Some weeks I was hectic, backwards and forwards to visit Distilleries in Scotland, and viewing commercial properties. Other weeks I would be stuck waiting for a letter from HMRC.    On those weeks I helped build a Lego model of Durham Cathedral, and compiled a fantastic post punk playlist in iTunes.

I quickly tired of answering questions about variable working hours. Frankly after the first couple of times I just said “the same as last week” whether it was true or not.  Apologies to LFS for this, but I was bored, and I’m not great with paperwork.  I once told the Manufacturing output survey that all of my staff were goats for a similar reason.

For people who are working multiple jobs, on zero hours contracts, or self-employed with highly variable hours this is a massive chore, and the survey structure gives an incentive to under report variations in working patterns.

You can add to that the complexities of actually making sure that people in marginal and irregular employment, who may well be in marginal and irregular accommodation, are represented in the survey cohort in the first place. 

I spoke to LFS about this – they confirmed they use the postal address book for the Royal Mail, but were unwilling to enter into further discussion about how this effected their sample size.   Postal Address is one of the more accurate ways of finding people – but as I found out when I worked for CMEC – over the last 20 odd years large numbers of people have dropped off official lists, including the electoral roll, in very large numbers.  The government spends millions every year tracking these people, none of which goes on LFS.

Instinctively the people who aren’t on the post code list are more likely to be working odd hours, and in marginal employment.

I have searched to see if there are academics looking at the problem of gathering labour force statistics.  There isn’t much, but what there is seems to match my conclusions:

The system for recording information about the UK labour force hasn’t kept pace with changes in how we work

As a consequence there are  significant inaccuracies in the basic data about employment and the UK economy

Underemployment is much worse than the headline numbers would lead us to believe, however this is made up of a mass of bad data, over supplies of labour in some areas, under supplies in others, over stretched employees in one place, underemployed people elsewhere.  Lots of people have jobs, but not enough hours to live on.

When the economy is growing strongly the inaccuracy gets less, in fact in a strongly growing economy the statistics might understate employment. In a slow growing economy the statistics over state employment. 

The gap between government and civil service statistics and reality is one of the reasons why people are instinctively reluctant to believe politicians and statisticians (experts), the world they are describing is so far divorced from their real life

I always knew that the way we reported unemployment was spun. Even the Guardian, who are usually sceptical of wild government claims were happy to print this headline this week:

My guess is that we have been overstating employment in the UK for 20 years. At first the inaccuracy was small, when self employment and zero hours contracts were unusual, and the economy was growing strongly.  Since the credit crunch self employment and zero hours contracts have risen and the problem has got larger.    The coalition created a loop hole in the unemployment benefit system which encouraged older wealthier claimants to become self employed – effectively self unemployed. This has made the problem much worse. 

When we leave the EU there will be a chance to rebase the LFS to try and create something which is better able to capture the new categories of work.  Sadly we live in an era where given the choice of good data that is hard to spin, and crap data that is easy to spin we can all guess what we will end up with.

I am not even sure that the traditional categories of employed, unemployed and economically inactive are actually valid, given the number of workers on zero hours contracts who move from full time to part time employment day by day, people in the “gig economy” who might do several jobs, and people who are unwillingly self employed in the industries where they used to be employees.

To prove my hypothesis right would take lots of statisticians, economists and civil servants, and would be politically explosive.  I don’t have those resources, but over the next few blogs I will explore deeper the way government, people and official statistics interact based on my own in and out of central government.

Alternatively if you work on an industrial estate in the North of England you could test the accuracy of the unemployment statistics by just walking around – the slack capacity in the UK economy; people, buildings, machines, is obvious to the naked eye. In fact we have become so used to seeing it we have almost zoned it out – we expect to see empty shops on the high street, factory units for let.

Lots of people were shocked during the EU referendum at the willingness of large numbers of voters to openly scoff at expert opinion, shocked at Michael Gove’s dismissal of their views.   

The fact that the world that experts have been describing is a totally different world to the one most people live in seems to have passed people by.  People don’t believe official statistics or government spokesmen because they are talking about a world which bears no relation to the one they live in.   Like getting GDP figures from Narnia. 

It’s the same with fake news – when the real news and the real facts describe a world that you don’t recognise any more why not put your faith someone with no facts who tells a better story?

I should really have redacted Cathy Staniforth’s name from the emails above, but I was so surprised when writing a blog with a title taken from a Half Man Half Biscuit song to get an email from someone who themselves appears mysteriously  in an HMHB track.  This is exactly the kind of sign which led Dan Brown to the Holy Grail.

The APC driver who collects our parcels is a mad keen Brexiter.  He still has his Vote Leave badge on his tabard, and believes profoundly that Brexit will reduce immigration, which in turn will increase his wages.   

He calls me a Remoaner.   

I explained to him that I don’t mind being called a Remoaner, and that the Ramones are one of my favourite bands.  He doesn’t get the joke no matter how many times I shout “Hey ho! Lets go!”, or tell him about the Ramones gig I went to at the Mayfair in Newcastle (The Prisoners were the support act).   I fully intend to continue to tell this joke until he laughs, no matter how long it takes.

His views on immigration and Brexit are fairly common on the Industrial Estate were I work.  Although he has been in his current job for years he is still on a really low wage, and has discovered somehow that he earns less than the lowest paid person at the Distillery (we have a living wage+ policy).   The link in his mind between immigration and low wages is unshakeable, even though the company he works for doesn’t employ anyone who isn’t from Birtley.

Just before the last election we applied for registration with the Home Office UKBA so that we could employ people from outside the EU (a sponsor license).

We were hoping to employ an American to establish a sales role for us. She had done a similar job in the US, was familiar with the American Craft Spirit market, and was in the UK for 9mths to a year while her partner was at Durham University. The idea was that she would eventually recruit someone local to replace her when she went back to the US

In order to recruit someone from outside the EU you have to be registered as a sponsor, as well as having approval for the person and the job.   Most big employers are registered as sponsors.

We had 2 attempts to register both of which were unsuccessful.  Our essential problem is that we are a food and drink company.   It was explained to us discretely that there is a perception in government and in UKBA that food and drink company means takeaway or restaurant, which in turn means Asian.   We were advised by the UKBA business support team to emphasise on our application the kind of business we were, making it clear that we weren’t a takeaway or Asian owned restaurant – we were given hints how we could emphasise that we were white and not involved with curry or noodles.   UKBA seemed rather oblivious to the unsubtle racism of this approach.

Obviously we were unsuccessful in making our business sound white, which costs us a lot of money (over £1k).   I complained and threatened to cause a stink, and we got an apology and our money back.

It is however clear that the official or unofficial prohibition on food and drink businesses recruiting from outside the EU isn’t going to end soon, no matter how much it damages small businesses.   Particularly as lots of the small businesses it damages are Asian owned.   

Post Brexit that means that we won’t be able to recruit anyone directly from outside the UK.  The government is committed to reduce the number of food and drink businesses who have sponsor licenses, which means we will never get one.  It’s also why in some smaller towns and cities Indian takeaways are closing as they can’t recruit staff.    Food and drink of course won’t be the only industry sector which has similar restrictions on, nor the only one where the licensing restrictions have a strong whiff of racism.

That of course doesn’t quite mean that we can’t recruit from outside the EU, just that they will have to qualify to work in the UK before they come to work for us, which is even more confusing and bureaucratic for small businesses.

The end point is that the kind of immigration management systems that Theresa May operated as Home Secretary are prone to huge and often unseen biases – big employers with sponsors licenses will be fine – small businesses can get stuffed.  Asian owned small businesses in small towns will be bottom of the heap.   

This will change the dynamic of immigration into the UK.  Big companies in big cities will still be able to recruit from abroad to fill skills shortages as long as they have political leverage.  Small business in small towns won’t.   

Big cities will continue to be prosperous, diverse and have high levels of economic activity. Small towns will have fewer businesses, as small businesses in small towns, particularly poorer towns are disproportionately owned by immigrants.

At the moment the government is stuck between an economy highly dependent on importing skills from abroad and group of voters who actively rejected immigration and are prepared to take radical political steps to “get their country back”.  These voters may well determine the outcome of the next General Election.    An immigration system which allows immigration led by big companies based in big prosperous cities, but which bans immigration into small businesses and small towns is a crude way of resolving this problem.   I suspect that this is exactly the way a post Brexit May government will control immigration – by manipulating the allocation of sponsors licenses.

Pret a Manger will have a sponsors license, and will be able to employ non-British workers for their shiny stores in big cities.  They will do well.   The Jewel in the Crown in Birtley won’t be able to recruit a new Bangladeshi chef. They will do badly.

The risk of course is that it just makes rich and successful parts of the UK richer and more successful, and the less well off areas with high levels of anti-immigrant sentiment even poorer.  

None of which will have any impact on the wages of our APC driver. 

At the moment he doesn’t care about the consequences of Brexit.  Brexit isn’t a means to an end for him.  It is an end in it’s own right – that’s why Brexit means Brexit.   The company he works for has no immigrant employees, and is highly dependent on import and export. He lives in a town which is almost exclusively white, and where the only immigrants are business owners and their families.   He will still have rubbish wages, and his home town will be whiter and poorer.  The question is – will that make him happier?  

.   

I stood in a glass cube.  The kind of glass walled office designed to make Senior Managers look hard working and transparent.   The kind that discourage people from entering.

With me was the Finance Director of a large statutory public body.

He surveyed the massed ranks of accountants and finance staff which occupied the whole floor of the building (many more were housed elsewhere).  He turned to me and said

“I haven’t got a fucking clue what most of them do”

I was shocked by this, because we had just finished a 15% headcount reduction programme.   The people we were looking at were the ones judged worthy of remaining in their jobs, or who hadn’t made their case for early retirement strongly enough.    Some of them were carrying out typical management and financial reporting activities.   The majority however were doing other things…. audit, compliance, regulatory requirements, the list went on.  Most of which were  mandated by the same politicians who had demanded the headcount reduction.

 

When I got my first real office jobs 25+ years ago we had a proper accounts department, with a Chief Accountant, Head of Finance, and lots of accounts clerks.   Invoices and receipts were handled manually, and many records were still on paper.   The process of producing management information was laborious, and every month a document full of MI would be circulated among anyone of a particular grade or higher.

I was one of first people in the office with a laptop. I was doing an MBA, and therefore was worthy of a 386 processor.  I could do most of the roles that management accountants could do better and faster.  One day I built a spreadsheet which showed how changes in contract structure would impact on sub-contractors, and thereby influence their behaviour.   It contained more data than every MI report in the organisations history.   I kid you not.   I was spreadsheet king.

It was clear to me that the people doing all of those accounting jobs would soon be out of work.   Excel, some laptops and a training course and most managers could do the work of a management accountant easily.  Sage and Xero would do the rest.

25 years later the number of accountants has increased rather than decreased in response to a technological change which should have wiped them out.  The fall in the price of accounting increased demand, so that pretty much every function in every business smaller than a few employees required massive amounts of data.

This allowed the extension of financial analysis and financial control into areas which previously had never needed it, including areas such as Hospital administration which are now led by finance rules rather than patient need.

Neo-liberal orthodoxy demanded that everything should be outsourced, competed, marketetised, all of which drove demands for more and more data.     As businesses, and public bodies became larger, in the belief that economies of scale would improve profit/reduce cost, so the people who ran the business were held to account by more and more data.   Politicians who knew less and less about the services they were responsible for demanded more data.   Shareholders remote from their businesses operations demanded even more.

Technology should have killed management accounting.  Instead it has taken over the entire public and private sector.   

Predictions that advances in computing will kill of lawyers are similarly likely to be off the mark.  A fall in the price of legal advice will increase demands for it.   Decisions which now need finance sign off will require legal/risk sign off too.    

I had a lucrative career outsourcing civil servants, negotiating contracts in the NHS internal market, and dealing with the private sector on behalf of the state, all of which required masses of data to justify decisions.   When Cameron and Osbourne came to power they demanded that the state should shrink, but accompanied that with demands for more outsourcing, more competition, and more policy.  They understood less about how the state operated, and so demanded more and more data, more and more plans, to justify decisions which had already been taken.

It is almost axiomatic that if a right wing politician announces policies to reduce government bureaucracy the amount of paperwork will go up not down.  The more ambitious and right wing the politician the bigger the stack of paperwork.   

The current fashion to denounce neo-liberalism is unlikely to make things better.  The speed with which right wing politicians switched from demanding that everyone should adopt neo-liberal policies to denouncing anyone who adopted neo-liberal policies is breathtaking.   Particularly when the post neo-liberal policies that they are enacting are so close to neo-liberalism that you wonder whether they people writing the speeches and the people writing the policies have ever met each other. 

The last time I saw a volte face like that was when a mate of mine persuaded everyone to become Adam and the Ants fans.  A week later he changed his mind and told everyone they were shit, leaving them stranded with a load of Ant Music badges.   

At the end of the meeting in the glass cube the Finance Director told me that only 3 people in the entire finance and commercial structure actually made a difference to the bottom line, and 2 of them were in the room.   

I was flattered by this, although I did look round surreptitiously as I left incase a very small, very brilliant management accountant was lurking unseen next to the executive plant.

Finally got round to catching up with  the Harvard Business Review article about Robots taking peoples jobs, in which they forecast the rise of Robot Doctors.  There have been a lot of excitable headlines about Robots wiping out white collar jobs, and the HBR paper generated plenty of noise in the press.

I understand why using robots in healthcare seems like a really good idea.  Technology has helped loads of industries become cheaper and more efficient, and making access to medical care cheaper and easier has a massive benefit globally.  Right now I am sure Theresa May and Jeremy Hunt are being told by their Special Political Advisors that the NHS needs to become much more efficient rather than giving it more money. Black hole, service change, new technology, you can guess the rest.

I am sceptical about the ability of Robots to replace Doctors, particularly in developed healthcare markets like the UK and the US.   Last year for example Johnson and Johnson discontinued their Sedasys automated sedation system.   To illustrate why I am a sceptic here are a couple of scenarios:

Toni and Guy

I get my haircut in Toni and Guy.  It’s a great haircut, and I enjoy the whole experience, the white walls, staff all in black, hair wash, free coffee. I could get it cut somewhere cheaper, or do it myself, but I don’t.

If Toni and Guy had a haircutting machine that was 99% as good as my current stylist (Catherine),  50% faster and 50% cheaper I still would get Catherine to cut my hair.   Partly that is because of techno-fear, and partly because I have seen the haircutting machine in Chitty Chitty Bang-Bang.  Mainly, however, it is because the person is the experience.   I am not paying for an output (a haircut), I am paying for the time of a very good hair stylist, and a product that takes away that contact is much less valuable to me.  A Robot  which worked alongside my stylist and who could remember every haircut I had ever had would be much more useful, if I ever wanted to go back to a previous hair style (honestly who wouldn’t love a robot that could tell you every haircut you had every had?).

In real world healthcare Doctors aren’t dealing with definite and specific diagnosis all of the time, easily identified by bio-chemical markers.  They are dealing with people in distress, who are often unsure what is actually happening to them. Getting a diagnosis and treatment is of course the outcome, but the process of how  it is arrived at – the time the Doctor takes with them, the skill with which the Doctor teases out the crucial bit of information that allows  diagnosis to be made – are just as important to the patient.  Often they have a material impact on the outcome too.

I would have a very strong preference for a real human Doctor, no matter how fallible, over a robot in all but the most straightforward diagnosis. The NHS tried to create the equivalent of the robot who remembers my former hairstyles – it was the National Programme for IT, and it demonstrated perfectly how easy it is to waste huge sums of money trying to use widespread standardised technology to drive managerial definitions of healthcare process efficiency.

A service with fewer Doctors who spend less time with patients is worse in the eyes of the patient regardless of the clinical outcome.  As a former NHS manager who spent loads of time trying to make healthcare processes more efficient it is easy to miss this point.   In fact most human services have a similar dynamic, for the customer more efficient just means a bit worse.

Benefits Medical Assessments

As well as providing healthcare Doctors take responsibility for it.  As professionals, answerable to the GMC for their actions, they are accountable for the decisions that they make and the care they provide.    When something goes wrong it is more often the Doctor who is held to account, rather than the organisation.

Transferring this responsibility from the Doctor to the organisation is tricky, as the experience in the UK with providing outsourced medical assessments for disability benefits demonstrates.   Typically the organisations which carried out these assessments had non-medically qualified assessors who worked to protocols developed by a small number of Doctors, who were clinically accountable for these protocols.

The decisions made through these systems were highly controversial, and a great many of them were overturned on appeal.  Pretty much every Doctor I have spoken to has a horror story to tell about the decisions these processes produced.   The assessors who were making the decisions weren’t evil, or callous, they were acting logically according to the system who employed them.  The system contained an incentive to produce decisions radically different to the decisions that the patients own GP or Consultant would have made.  So radically different in fact that I am surprised that none of the senior Doctors involved involved in these systems ended up in front of a GMC panel.

The legal, ethical, and insurance implications of taking clinical responsibility away from the individual Doctor and transferring it to an algorithm are much greater than people like HBR realise. The potential for organisational, legal, and commercial imperatives to distort clinical priorities through the use of robots, or any kind of algorithm based decision maker, are huge.

Personally I would spray paint Doctors silver and dress them in space age spandex.   Patients would love it.