The analysis of 112,000 Jobcentre Plus vacancies shows that only 52% of the positions guarantee enough hours to meet the new government definition of “work” for a typical family. It means that some working families are likely to be far harder hit by the controversial changes to working tax credits than previously feared by being caught in a new working-hours trap, and raises concerns about the quality of jobs being created in the economy.
The news came as the Institute for Public Policy Research warned that an extra 100,000 people will be jobless by the end of the summer. Its analysis of Office for Budget Responsibility (OBR) forecasts of risingunemployment shows that new jobs being created in the private sector fall far short of providing sufficient employment for an expanding labour market. The OBR does not expect unemployment – which stood at 2.67m in March – to fall significantly until at least September 2013.
New in-work benefits rules were introduced by the government last Friday requiring couples to work an extra eight hours a week to keep their benefits. But competition to find such work is much stiffer than official figures acknowledge, suggesting that thousands of low-income families will see their income plummet. Out of 112,179 vacancies advertised on 22 February – the full Jobcentre Plus database at the time the Guardian’s freedom of information request was granted – only 58,534, or 52%, could be verified as long-term vacancies offering enough hours to meet the new government definition of “work” for a typical family.
The data reveals that at least 24,000 job positions did not offer enough guaranteed hours for families to qualify for working tax credit, which tops up the income of a family earning £17,000 by around £3,700 a year. Brendan Barber, general secretary of the TUC, said the findings showed the government needed to take more action to boost jobs to avoid “devastating” consequences of its welfare changes.
“These figures suggest that unemployed people looking for full-time, permanent work are going to have a real battle on their hands trying to find a job that will pay them enough to support their families,” he said. “The consequences for these families will be devastating. Ministers have got to stop pretending that 400,000 vacancies are anywhere near enough, and look seriously about how to get our stagnating economy growing so it creates the proper jobs paying decent wages which will solve our unemployment crisis.”
A further quarter of vacancies offered applicants no guaranteed income, were for short periods of time, or were classed as self-employed, meaning benefit claimants could face serious delays to receiving benefits, or they may simply not have worked long enough to qualify at all.
More than 2,000 jobs on offer were for “zero hour” or “as and when” contracts – jobs which offer no regular or guaranteed hours, but which regularly require people to be available at short notice any day of the week, and at virtually any time.
These jobs, which are often in the nursery or care home sectors, offer no guaranteed income and rule out other part-time work due to their irregular hours.
In the areas hardest hit by the economic downturn, official figures show there are up to 22 jobseekers for every vacancy. But with many apparent vacancies being difficult or even unsuitable for those looking to raise a family, the true picture is likely to be substantially worse.
Previously, anyone with a child needed to work at least 16 hours a week to be eligible for tax credits – and around 13,000 vacancies did not meet this criterion. But new rules which took effect last Friday upped this limit for couples to 24 hours, meaning that if only one partner was in work, more hours must be worked. This affected a further 10,000 vacancies.
An additional 8,800 jobs did not offer enough detail to establish whether they offered enough hours to meet the government rules, while 5,400 of the remainder were classed as “self-employed” and so were potentially also ineligible, especially as many offered no guaranteed income or little to no guaranteed contracted hours. Of the remaining roles, more than 15,000 were classed as short-term on the jobcentre system, meaning they offered employment for at most six months, and often substantially less. One Citizens’ Advice Bureau adviser, who asked not to be identified, said welfare changes were “doubly punishing” families unable to get enough work to earn a survivable income:
“[Clients] say ‘well, if I could get an extra 10 hours a week of work I wouldn’t need the tax credits because there’d be more money coming in’. So there’s a bit of unfairness of the situation: they’re feeling doubly punished. One, they can’t get enough work and two, they’re losing the income they’ve got.”
“And if you’re working on minimum wage, 16 hours a week and you’re getting tax credits, you haven’t got any spare income. So it means cutting back on food, or cutting back on paying debt, or cutting back on putting money in the meter for your gas and electricity.”
Student Katy Carter’s partner works 20 hours a week and is unable to get an additional four hours’ work. Despite looking for work since Christmas, Carter says she has been unable to find a job which fits around her childcare commitments for her five-year-old daughter. “We lose just over £71 a week which for us is a substantial amount of money. We were just breaking even on bills and expenses such as food and transport and after looking through my budget, we now have a deficit every week. I understand the government has to save money somewhere but it seems ridiculous to take it from the people who need it the most.”
The Treasury said changes to tax credits were necessary to reduce the deficit, and said more people gained than lost from the changes.
Economic secretary to the Treasury, Chloe Smith, said: “The government’s actions mean that from the beginning of the new tax year on Friday, 24 million households will be £6.50 a week better off.
“We’re taking millions out of tax altogether by raising the personal allowance, which will put up to £126 cash back in people’s pockets. The basic state pension is also going up by its largest ever cash sum and there are increases in most other benefits.”