What is a Job Guarantee?
A Job Guarantee is a straightforward concept. It is the government’s offer of a job to everyone who wants one, at the living wage, working for the public good.
And how would that work?
If you are short of work, you would go to the Job Centre and ask for a job. The Job Centre will then link you with volunteer, community, and government organisations that have openings and offer the type of work you want to do. Job Centres become places that provide ‘Jobs for the People’ - a true labour exchange.
What would I get paid?
You would be paid the current living wage. For example, if the living wage was set at £10 per hour and you worked 37.5 hours a week, you would get a gross wage of £375 per week. That’s five times the current rate of Job Seekers Allowance of £74.70 per week. Or over six times the weekly wage of £59.20 for those under the age of 25.
What type of job would it be?
It’s really down to what you want. If you want a full time job, then you would get a 37.5 hour-per-week, 9am to 5:30pm job, Monday to Friday, with the regular four weeks of paid holiday plus bank holidays. Full maternity cover and sick pay are included. In other words, the kind of job you’d expect to find in a civilised society.
If you are working part-time elsewhere, then you can ask for a top-up position from the Job Guarantee. You’ll never be short of work or a living wage.
You can work outside if you want to. You can work inside if you prefer. It is entirely up to you.
I’d like a job drinking beer and watching Sky Sports
Perhaps, but what would others think of you then? As the late, great Muhammad Ali said, “service to others is the rent you pay for your room here on earth”. And he was right about that. The Job Guarantee is there to help you make that rent.
I’ve got this great idea for a business.
Terrific. Bring your business plan to the Job Centre and present it to them. If they like the sound of it, then you could join the Enterprise Allowance Scheme. It provides three years of Job Guarantee support while you get started.
How does the Job Guarantee help my local area?
The Job Guarantee provides a job in the local area for every person that wants one. If your area is currently experiencing high unemployment, the job guarantee provides a massive injection of spending. Job Guarantee workers earn wages, which they spend in the shops. Local businesses sell stuff, expand, and hire people on the back of that. Commercial life returns.
Job Guarantee work improves the look, feel, and life quality of deprived areas, making them vibrant and desirable places to live and run businesses. Run down areas get a fresh lick of paint and a polish. All of which makes people feel good and smile again.
So how will the government pay for it
It pays for everything in the same way — by spending the money. A government of a country like the UK, Japan, or the USA that uses its own currency can never run out of money.
Once you learn the secrets of the government’s credit card — secrets the establishment wants to hide — you quickly realise the government can buy anything unused that is priced in its own currency. The unemployed will work for money if you ask them to.
The government can, and should, offer a job and a living wage to all who require one.
But prices will go up!
The Job Guarantee is a job. It is a job created in the same way as any other new job in the economy. If creating new jobs and reducing unemployment caused prices to go up immediately, we would see that with every increase in business and trade. Yet we don’t.
The government can, and should, offer a job and a living wage to all who require one.
Less Tax?
The Job Guarantee wage is only paid to people working in Job Guarantee jobs. The more people on the scheme, the more government pays in wages. When they move to private sector jobs that payment stops, which automatically reduces the amount of wages paid.
It is an “automatic stabiliser”. Spending goes up when the economy is down, and spending goes down when the economy is up.
Because it is carefully targeted at only the people that need it, and because it automatically self-adjusts based upon need, there is no requirement to correct any overspending via taxation on the other side.
The result of that is straightforward. Tax rates can stay as they are.
Why is the private sector excluded?
Simple really. Why should the state subsidise private profit? If the state pays, then that is the same as all the citizens paying. Since the citizens paid, they should receive the output produced by Job Guarantee employees — tider parks and gardens, more charitable services for older and younger people, free art and entertainment.
But perhaps more importantly, the job of the private sector is actually to put everybody in the private sector out of work — by automating away jobs and replacing them with machines and advanced methods. The Job Guarantee helps that happen by making labour relatively scarce and forcing the private sector to compete to get it.
Strapping people to the back of a primitive planting machine only happens if labour is cheap and plentiful. Make it scarce, and suddenly that new automated robotic planting machine looks like it is worth the investment.
Labour competition forces businesses to invest more in better training and methods, increasing productivity and raising the standard of living across the country. Easy access to labour stifles productivity growth and reduces business investment, and we’ve seen far too much of this in recent years.
Why is the public sector excluded?
It is and it isn’t. The public sector can use as much of the Job Guarantee labour as it wants to — at the living wage. However, because workers on the Job Guarantee may move in and out of the programme rapidly (as they find other jobs elsewhere in the economy using their newly acquired skills and experience), it is not the best option for public sector tasks that must be completed right away.
Once the Job Guarantee is in place, everybody has a job, which means that required public sector services come about by moving people from existing jobs to the public sector. Taxation is the tool you use to release people from existing jobs. So you’re back to traditional taxation and spending, along with the associated political debate.
Overall, needed public services will be accompanied by sufficient taxation to ensure the workers don’t get poached by the private sector at the height of a private sector boom.
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First Published 4 Jun 2016. Updated Jan 2022