Economic insecurity has become the “new normal” in the UK with at least 70% of the UK’s working population “chronically broke”, according to a study by the thinktank the Royal Society of Arts.



Thriving, striving or just about surviving, the RSA/Populus survey of more than 2,000 workers, found that while about 30% of respondents said they lived comfortably, 40% said their finances were permanently precarious. The remaining 30% said they were not managing to get by.

“Economic insecurity now stretches right throughout our labour market, including within jobs that appear safe on the surface,” said Brhmie Balaram, the author of the report and a senior researcher at the RSA.

According to the report, 32% of the UK’s workers have less than £500 in savings and 41% have less than £1,000. Almost 30% are concerned about their level of debt while 43% of workers do not have anyone in their household they could depend on to support them financially in the event of hardship. Fewer than half of employees (44%) feel they have progressed in their careers over the last five years; only 40% feel they have good opportunities to progress in future.

“From retail workers to warehouse operatives, and from care workers to cleaners, we are beginning to uncover the hidden millions who are chronically broke year in, year out,” said Balaram. “The real danger for this group of workers is a childcare bill unpaid and yet another rent rise around the corner.”

UK labour market statistics released on Wednesday showed employment reaching a record high last year. But, the RSA report makes clear, wider economic trends suggest workers are worse off as real wages fall and in-work poverty rises.

The RSA report identifies what it calls Britain’s “new class structure”. It also launched an online tool that lets people explore which “class” they fall into.

The chronically precarious: the reliably broke, people in this group are typically on a steady contract albeit with low pay. 60% have less than £1,000 saved and they have low job satisfaction and little autonomy at work. Typical job: full-time sales assistant.

the reliably broke, people in this group are typically on a steady contract albeit with low pay. 60% have less than £1,000 saved and they have low job satisfaction and little autonomy at work. Typical job: full-time sales assistant. The acutely precarious: usually broke but with significant income “yoyo-ing”. Work is often low-paid but, unlike the chronically precarious, irregular. This is a young group and 45% have a degree. Typical job: zero-hours hospitality.

usually broke but with significant income “yoyo-ing”. Work is often low-paid but, unlike the chronically precarious, irregular. This is a young group and 45% have a degree. Typical job: zero-hours hospitality. The flexi-workers: love their job, even if it doesn’t pay well: 83% are satisfied at work but 59% earn less than £21,000 a year. High levels of savings: many are redundant “second careerers”. They value autonomy above security. Typical job: freelance photographer.

love their job, even if it doesn’t pay well: 83% are satisfied at work but 59% earn less than £21,000 a year. High levels of savings: many are redundant “second careerers”. They value autonomy above security. Typical job: freelance photographer. The steady-staters: feel well treated (90%) and well paid (69%), even if work is a means to an end. But they have low savings, and rely on work for income so are vulnerable to a shock. Their routine jobs are at high risk of automation. Typical job: public sector administrator.

feel well treated (90%) and well paid (69%), even if work is a means to an end. But they have low savings, and rely on work for income so are vulnerable to a shock. Their routine jobs are at high risk of automation. Typical job: public sector administrator. The idealists: mid-earning, passionate and often millennials (50% under 35), 70% think they make a positive contribution to society at work. They are most likely to rely on others, such as parents, for income. They are urbane and 25% have more than £10,000 saved. Typical job: charity employee.

mid-earning, passionate and often millennials (50% under 35), 70% think they make a positive contribution to society at work. They are most likely to rely on others, such as parents, for income. They are urbane and 25% have more than £10,000 saved. Typical job: charity employee. The strivers: these have regular jobs with high income and high savings, but worry the link between hard work and fair pay has broken: 73% are stressed but only 20% think their pay reflects their efforts. Typical job: middle manager.

these have regular jobs with high income and high savings, but worry the link between hard work and fair pay has broken: 73% are stressed but only 20% think their pay reflects their efforts. Typical job: middle manager. The high-flyers: the wealthiest group: 55% have more than £10,000 in savings. They are successful at adapting to automation, and the most likely group to value new technology. They report high job security, high autonomy and high fulfilment. Typical job: director of an IT services business.

There are now nearly 1 million people on zero-hour contracts and 1.7 million in temporary work. A record 4.8 million are self-employed, while there are an estimated 1.1 million people in Britain’s gig economy, which – in just five years – will equal the number of workers in NHS England.

“Despite the differences between the seven segments persuasively described in this report we can clearly see how many people are impacted by common problems,” said Matthew Taylor, the chief executive of the RSA, who recently carried out an employment review for Theresa May. “Precarious work is a theme, as is a lack of autonomy or control at work (both issues underline the call for good work in the review I undertook for government last year).”

The report calls for new rights, responsibilities and a modern social contract based on support for people as they navigate changes to the cost of living, technology, and Britain’s international competitiveness.



It says the government must explore universal childcare; pay for the self-employed to take maternity or paternity leave; devolve the “national living wage” to councils, and pioneer personal budgets for reskilling as the age of automation looms.