In a precarious labour market, universal basic income isn’t the only solution

Sarah O’Connor updates

On November 9 1830, a hundred farm labourers descended on a farm in Kent in the south of England and destroyed a threshing machine with saws, hatchets and axes. At Burnham Overy in Norfolk, workers destroyed another machine as they shouted: “It keeps an honest man from getting work.” The country was in the throes of the Swing riots, where farm labourers smashed threshing machines, burnt barns, sent threatening letters to farmers and demanded higher wages. By the last 10 days of November, write historians Eric Hobsbawm and George Rudé, “virtually all of Southern England seemed in flames”.

The workers were responding to transformations in the world of work which had left them desperate. New threshing machines saved labour by a factor of five to 10, displacing many workers who usually relied on manual threshing jobs to keep them going in winter. Farm employment had become more casual and precarious. “It is cheaper to hire day labourers . . . than to maintain servants in the house, especially as they are always sent home on a rainy day,” one contemporary observer wrote.

We are at another moment in history where work is becoming more uncertain and insecure, at least for some. Last year, Amazon Flex drivers were hanging their smartphones in trees outside pick-up sites in an apparent attempt to try to win a split-second advantage as delivery tasks went to those closest by. On some farms in Scotland, raspberry pickers were being sent to sit in their caravans unpaid when it rained or when their productivity rate fell too low.

The idea of a universal basic income — a policy where the state pays everyone a monthly sum without conditions — is often pitched as a solution to these problems. If technology is set to make work more scarce, unpredictable or precarious, advocates say, we need to give people a base level of income that is independent of the labour market. Otherwise, they might end up just as angry and desperate as the machine-breakers of the 1830s.

But a UBI wouldn’t just be a response to the changing labour market, it would also shape it in ways that are hard to predict.

In the case of the Swing riots, some historians have argued that a well-intentioned welfare system actually helped to exacerbate the plight of farm labourers. In the mid-1790s, magistrates in Speenhamland in Berkshire decided on a local system of poor relief that would top up the wages of the low paid to a minimum income based on the price of bread. The system spread, but according to economic historian Karl Polanyi it was a “fool’s paradise” because it encouraged farmers to pay lower wages in the knowledge that public funds would make up the difference. When the cost of the system rose, its generosity was cut sharply. “[The] ‘right to live’ eventually ruined the people whom it was ostensibly designed to succour,” he wrote.

It’s important to stress this isn’t the only version of the story. Other historians dispute the notion that the Speenhamland system impoverished people. They say the system of poor relief, which varied widely between parishes, is better seen as an insufficient remedy to the problems of the age rather than a contributor to them.

Nonetheless, it is worth considering how employers today would respond to the introduction of a UBI. We know that employers do react to welfare changes. One academic paper suggests the UK’s “working families’ tax credit”, introduced in 1999, led employers to reduce wages somewhat for recipients of the top-up, with a spillover effect on to those who weren’t receiving the benefit.

If a UBI let employers off the hook entirely from the idea that a job should be something a person can live on, it could make it easier to hire people for fewer hours on a casual or fleeting basis. Campaigns for a “living wage” and “living hours” might lose steam. Even minimum wages could come under philosophical assault. You might argue that would be no bad thing if it gave employers more flexibility while people still had income security. But variable income isn’t the only problem with an unpredictable job: it also affects your ability to arrange childcare, plan a life outside work and maintain relationships.

On the other hand, UBI’s supporters argue it could have the opposite effect. People with a solid income floor to rely on would be able to walk away from jobs that are badly paid or don’t fit around the rest of their lives. Employers would be forced to compete for staff by offering attractive pay and conditions.

Which of these scenarios would be more likely would depend on the generosity at which the UBI was set and the macroeconomic context in which it operated. Sadly, pilot schemes such as the one in Finland can’t help us much with this question, since they are too small to affect employer behaviour.

In the meantime, there are other things we can do to improve the future of work. The first step should be to recognise that not every problem is the result of technological change. The raspberry pickers who are sent back to their caravans without pay when they pick too slowly, for example, are not the victims of an algorithm or machine. The farmers treat them this way because the law allows it.

UBI is worthy of more debate. But there is a danger in seeing job insecurity as an inevitability to which we must adapt, when in some cases it is simply a regulatory failure to which we should respond.

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