The OECD has warned that increasingly concentrated wealth at the top of society spells disaster for the world's economy. Frances Russell writes
When the Organization for Economic Cooperation and Development (OECD) issues a report entitled Power From the People, it’s time for governments to sit up and take heed.
“Inequality has risen in many advanced economies since the 1980s largely because of the concentration of incomes at the top of the distribution," OECD economists Florence Jaumotte and Carolina Osorio Buitron state. “Measures of inequality have increased substantially, but the most striking development is the large and continuous increase in the share of total income garnered by the 10 per cent of the population that earns the most,” they write in an OECD Finance and Development paper released in March.
You need look no further than the new labour market to see what concentration of wealth has wrought:
CBICWorldMarkets economist Benjamin Tal warned in a paper released in March that “our measure of employment quality has been on a clear downward trajectory over the past 25 years…. While the pace… has slowed in recent years, the level of quality, as measured by our index, is currently at a record low – 15 per cent below the rate seen in the early 1990s and 10 per cent below the level seen in the early 2000s.”
Tal goes on to report that the distribution of part-time/full-time employment since the 1980s shows a clear trend: “Since the 1980s, the number of part-time jobs has risen much faster than the number of full-time jobs. The damage caused to full-time employment during each recession was, in many ways, permanent…full-time job creation was unable to accelerate fast enough during the recovery to recover lost ground.” Tal also had another grim statistic: “During the year ending January, 2015, the number of self-employed workers rose four times faster than the number of paid employees. And since the late 1980s, the number of part-time jobs has risen much faster than the number of full-time.
“The damage caused to full-time employment during each recession was, in many ways, permanent,” he continued. “Over the past decade, wages in high-paying sectors rose almost twice as fast as wages in low-paying sectors …In other words, the fastest growing segment of the labour market is also the one with the weakest bargaining power.”
What we now have, Russell suggests, is a New Feudalism. A whole generation of Canadians faces part time and precarious employment, with no pensions and no benefits. And, if the Harper government has its way, the Canada Pension Plan won't do anything to alleviate their situation.
They are the new Lords of the Castle. And the young are the new serfs.