Pay gap hits record as UK job satisfaction sinks to new low

Pay inequality in Britain widened faster in the past year than at any time on record. Resolution Foundation economist Mike Brewer says the gap in pay rises between the top and bottom of the labour market is the highest ever measured. Pay for the top 10% rose by 7.3%; pay for the bottom 10% rose by just 1.1%.

The driver is twofold. The national living wage has stopped rising faster than median pay. At the same time, top pay has taken off again, Brewer said.

The backdrop is stagnation without modern precedent. Institute for Fiscal Studies director Paul Johnson told Guardian columnist Polly Toynbee that pay stagnation over the last decade is unprecedented since Napoleonic times — then corrected himself: "You might as well say ever."

What does the new survey show?

The British Social Attitudes survey, published this week, records the lowest job satisfaction since its records began. Workers report three lacks: flexibility in hours, career advancement and pay rises. The proportion of people expecting career advancement has fallen from 35% to 26%.

The survey's editor, Prof John Curtice, said one finding stands in the way of claims that the young are idle. The work ethic remains strong: only 4% of people would choose not to work if they could, and just 2% of young people.

Yet engagement is eroding. "The proportion willing to work harder than required to help their employer succeed has fallen to its lowest-ever level over the past decade," the report finds.

How wide is the wealth gap?

Wider than the pay gap. The top 1% own more than the entire bottom half of the country. Britain's income inequality is the highest in western Europe and has never fallen since it took off in the 1980s, Toynbee writes.

Public tolerance has shifted with it. In high-growth 2006, 25% of people told the BSA survey the government should shrink the gap between rich and poor. Now 53% say so.

Why upward mobility has stalled?

The tea-boy-to-boardroom story belongs to the 1950s and 60s, when white-collar and managerial jobs multiplied and even early school leavers climbed. Social historian David Kynaston documents that era in his book Deep into the Sixties.

Alan Sugar, the Hackney market trader turned billionaire, is the poster boy for that lost world. He now accuses young people of "a lack of hunger, wanting a quick fix, not wanting to put the graft in and get there through hard work". The statistics cut the other way: young people hold better exam results than their parents yet have less chance of progress and are likely to earn and own less.

What does Labour's workers' rights agenda change?

Labour's 2024 manifesto made employment rights its flagship policy. The BSA survey shows demand for it: 61% of people consider it important to decide their own working hours, but only 31% say they can in their current job.

Three changes carry the weight:

• Access for unions. New rights in force since last Friday let trade union reps enter every workplace to recruit — every KFC and McDonald's, every care home, every office — so employees can discuss working conditions without fear of reprisal.
• Flexible working. From next year, employers must give highly specific business reasons for refusing requests for flexible hours or home working. Refusals must be argued face to face, where the employee can bring a union rep or a fellow worker.
• Guaranteed contracts. Zero-hours arrangements will be banned and replaced with guaranteed contracts, so workers always know their schedule and their pay.

Who opposes the reforms?

The Confederation of British Industry, the British Chambers of Commerce and the Institute of Directors warn that more rights mean fewer jobs. Conservative leader Kemi Badenoch claims Labour's rights are "designed to drag Britain back to a world where unions call the shots and employers carry the blame". She has pledged: "At the first opportunity, a Conservative government under my leadership will repeal every job-destroying, anti-business, anti-growth measure in this bill."

The polling runs against the critics. A YouGov poll for Acas, the Advisory, Conciliation and Arbitration Service, finds 78% of people want flexible working — including, Toynbee notes, Conservative and Reform voters. Badenoch may regret the repeal pledge by the next election.

Deputy Prime Minister Angela Rayner has defended the reforms against doubters around Keir Starmer, and the payoff could be visible in time: workers may see their working lives improve just as economic conditions turn against them.