business economics equality wealth

Valuing the work that matters most

Income is one of the key indicators of value in our modern society – we pay people well to do things that we value highly, and pay them little for work that we consider less important. Cleaners and shop assistants are paid low wages, because in theory, they contribute little to the economy. Bankers and football players enjoy higher earnings because they add much more value to the economy overall.

This view has been challenged this week by a report from the new economics foundation. By adding up ‘social returns on investment’, they have been able to generate the total contribution that various jobs make to society – not just in profit, but in environmental and social benefits. The results are stark and provocative:

Banker
Salary: £500,000 – £10,000,000
For every pound that they earn, £7 of social value is destroyed through bailouts, loss of GDP and cuts to social services.

Nursery worker
Salary: £10,000 – £13,000
Every £1 paid to a nursery worker adds £7 of benefits to society, by allowing parents back into work, freeing up the mother’s time and energy, increasing gender equality and reducing absenteeism at work.

Tax accountant
Salary: £75,000 – £200,000
A tax accountant loses £47 of social value for every £1 earned, by channeling funds away from the public purse. The UK loses £25 billion a year to tax avoidance.

Waste recycling worker
Salary: £6.10 an hour
£12 of social value added for every £1 earned, through reducing landfill and carbon emissions, and adding value to what would otherwise be waste.

Every job has social and environmental ‘externalities’, consequences outside of the simple salary-work relationship. At the moment we pay some people extravagantly for things that are environmentally damaging and socially regressive. Others make a net contribution to society that is never rewarded in monetary terms.

You can read nef’s report here.

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