One conclusion from the report is that the lack of upward mobility seen across the OECD is not a cyclical problem, but instead is structural, and that workers must have the opportunity to develop skills that allow them to progress throughout their careers.
UKCES welcomed the report.
Commenting, Dr Vicki Belt, assistant director at UKCES, said:
It’s worrying that the OECD’s international evidence suggests a long-term trend of downward pressure on pay and progression at the lower end of the labour market. It’s vital that jobs contain pathways to progress upwards through a career, learning new skills and putting them to use productively.
Skills use at work is a missing piece of the productivity puzzle. We already know that the UK is experiencing a period of low productivity, with growth not yet back to pre-recession levels. Tackling pay and progression are two important ways of getting to grips with UK productivity.
UKCES raised the issue of skills use at work and productivity in its Growth Through People report, published in November 2014. In it, UKCES highlighted the need to look beyond the supply side issues (the skills system) and focus on the demand side of the equation (the way businesses design jobs or communicate progression opportunities to their staff).
Dr Belt continued:
It is important to show that changes to business practices can result in both better pay for staff and better performance for the employer, whether that is lower staff turnover or higher productivity.
It is for these reasons that UKCES, together with the Department for Work and Pensions, launched a competition through the UK Futures Programme, to establish a group of employer led projects. These projects will test ways of improving both pay and progression for staff and business through changes to business practice and job design.
The projects kicked off in the spring of this year and will run for the next 12 to 18 months. The Timewise Foundation is one example of this work. Working with Pets at Home, the UK’s largest pet retailer, the Timewise Foundation project will radically redesign jobs with the aim of providing clearer routes for progression and opportunities for promotion for those on part time or flexible contracts, typically women. One of the key changes will be to offer more family friendly flexible roles at a managerial level for workers to progress into.
Dr Belt concluded:
Addressing pay and progression is crucial to improving UK productivity, which in turn benefits the economy, the employer and the individual. By giving employees the opportunity to build the skills needed by employers and to do so in a way that addresses the flexibility in people’s lives we can boost productivity and also make growth that much more inclusive.