As the conversation surrounding the idea of a Basic Income Grant (BIG), the impact of the Covid19 relief grant and the broader intention of state welfare progresses concerns regarding labour market participation also appear to be increasing. Arguably, this is a consequence of the historical role of welfare schemes of Europe, America and later Latin America and Africa to supplement the labour market. Welfare systems have thus been structured according to the idea that if one is able to work, then one must receive an income according to one’s labour. This point is emphasised by James Ferguson “Instead of passively “taking” from productive others, a person in productive labour makes a contribution to society, thus gaining a well-earned sense of pride and dignity”. What are the impacts of the continuation of waged labour as the central paradigm? Can it be sustained under the current global and local context?  

 

An important area of research that can assist in answering the above questions is that of labour rights vis-à-vis productivity. Before the current conversations regarding BIG vis-à-vis labour market participation, was the notion that expanded worker rights would have a negative impact upon worker productivity and thus business performance. Jody Heymann and Alison Earle (2010) through their book ‘Raising the global floor: dismantling the myth that we can’t afford good working conditions for everyone’engaged with this and had some revealing findings. They conducted comparative analysis of the long-term commitments of national laws in all United Nation signatory countries. The main conclusion by the authors was that highly competitive countries* according to World Economic Forum (WEF) rankings for economic competitiveness found that good working conditions are common among these countries. The authors revealed that majority of these countries had paid sick leave with 10 out 14 offering paid sick leave for 6 months or more and; Guarantees of adequate paid leave for new mothers are common, with majority providing 6 months or more. 

Heymann & Earle also stated that “in short, basic protections for all people at work – from the right to annual leave, sick leave, and a day of rest to paid parental leave – are solidly in place in the overwhelming majority of highly competitive economies”. In addition, the authors also compared labour protections in 120 countries ranked according to their competitiveness by WEF and found that “none of the labor legislation we analyzed that guaranteed a basic floor of good working conditions is linked to lower levels of competitiveness”. Therefore, proving that the argument made by business lobbyist that greater business performances are produced by increased time in the office or factory floor are false.

 

Heymann and Earle’s conclusion arguably could be applied to the expansion of social welfare as well. Just as increased labour rights do not negatively impact competitiveness, a more expansive welfare package should not promote less labour market participation but rather be seen as a necessary adjustment. The idea that social welfare threatens labour market participation has been shown to be false. In her book ‘Give people money: the simple idea to solve inequality and revolutionise our lives’Annie Lowrey reflects on a review of cash transfers conducted by the Overseas Development Institute, the outcomes included: improved school attendance; greater ownership of productive assets; decrease in malnutrition and; increase in savings. Thus, showing that the fear or concern of an expanded social policy in the form of a BIG would decrease labour market participation as unwarranted.

 

Furthermore, the ‘decreased labour participation’ argument also fails to acknowledge the variety of work that is done on a daily basis. An example of such being the caregiving sector, consisting of both childrearing or caring for the elderly and/or ill. The lack of acknowledgement of this sector and others like it dismiss a large amount of productive work, which arguably represents a large proportion of unpaid work. Therefore, the enquiry into the perceived unproductivity associated with social welfare is misdirected. Instead, enquiry should be made into the incorporation/formalisation of existing work into waged practice. Especially when considering the current global context of greater competition as a result of globalisation; possible decrease in labour-force required as a result of technological advancements and; changing work environments and practices due to the Covid19 pandemic and future public health concerns. The caregiving sector represents a sector that is likely to expand, with their importance being brought to the fore during Covid19 period. 

 

Introduction of social welfare initiatives such as the BIG provides a starting point while greater development occurs. The value of receiving a wage or stipend in the form of a BIG for work done is immeasurable in both economic and social development. As mentioned earlier a wage allows for better living outcomes but also address issues of dignity and confidence in the pursuit of self-actualisation. The expansion and development of social welfare policy should be viewed as a requirement in assisting this shift we are currently going through. However, where caution is invited is the application of Social welfare. Policy such as the BIG can only be effective if it is a part of a bigger plan that also considers the re-definition of waged work. The drastic changes occurring in the country see an increasing unemployed population due to the shrinking traditional labour opportunities in the economy. Instead, the projected available labour opportunities will require greater qualifications and/or skill levels, which does not accommodate a large proportion of our labour force. The application of welfare policy to assist in the cushioning during this transition is required, but it must be met with similar efforts in education and retraining programmes as well. 

 

It is not only a waste of time and resources to do further enquiry into the negative impacts of expanding welfare policy on labour participation but counterproductive. What would be more fruitful are enquiries into current unpaid work and how to incorporate this work and create a different wage paradigm that is better suited and reflective of labour participation in our society. The current waged labour paradigm is under threat not only nationally but globally. There is a greater need for a combination of appropriate social welfare initiatives that support the population as well as a reassessment of sectors which are not only able to absorb people but is reflective of society.