Why Is The Economy Failing So Many People?

The economy is struggling to meet the needs of people in all parts of the country. But what can be done to fix it?

The problem

Today’s economy is not working the way it should, as growth figures don’t reflect in higher salaries or better working conditions for employees. Income inequality is rising to extraordinary heights as the gap between the well paid and the low paid expands beyond reason or explanation. Geographic inequality is growing too as jobs migrate from rural to urban centres with fewer pockets of regional success than in the past. Poverty for those in work and without work is increasing too, which should not be the case in a wealth generating capitalist system designed to serve the needs of everyone. Communities are failing behind too, as the share of national prosperity is unevenly distributed and reflects badly on those who make the decisions that affect people’s everyday lives.

Job security and wages are also under pressure as the next generation of house buyers struggle to afford homes while being squeezed by ever-upward rents. Many people are left behind in an economy that rewards only those with particular skills and has little use for workers without the abilities it seeks. For those valued by the economy, rich rewards are available once they are willing to serve in a never-ending race for dysfunctional economic growth. Unemployment is at a low, which should be welcome although it disguises the number of people in low paid jobs and contracts with scant conditions or support. Polarisation is fast becoming the norm as the economy divides between those doing well and those not, with a yawning gap in the middle where the majority of families used to live comfortable lives. The sense of injustice created by such a skewed spread of wealth is creating an unattractive, undesirable and unsustainable form of capitalism.

The solution

It is therefore time to consider how best to fix what’s wrong with the economy before the imbalance divides the country and damages local communities beyond repair. Government needs new policies and a review of what determines success in a digital economy where tax policy is one of the first items to address. Businesses need to change in some cases to reinvent themselves and stay relevant; in other cases to pay their share of tax, regardless of any technical loopholes online shopping may offer. Employees need to focus on developing new skill-sets to regain a position of strength in the work place and relevance in the economy. Without acquiring such skills employees will be at the mercy of a system committed to replacing them with automation and ever more capable robots.

So, the economy isn’t working for everyone and will keep failing until politicians, policy makers and the people pursue a fairer form of capitalism.