In that period of soul-searching that typically follows any instance of social upheaval, we shall no doubt hear many explanations for the events that overtook the streets of Britain last week. One which will surely elbow its way to the front is the notion that, in some ill-defined sense, the disaffected youth of this country have been denied any “hope”.
What hope is that, precisely? Is it the hope that, despite having set one’s face against the acquisition of even the most elementary formal qualifications in literacy and numeracy, or of basic English language or personal skills, one should be able to find an employer who will offer one employment in preference to buying a fork-lift or taking on a migrant?
Even as late as the 1980s the relative prices of capital and labour in the UK favoured those with low skills and a willingness to work, over expensive machines. That factor-price ratio has now changed, probably for ever. Globalisation, technological advances and a downward rigidity in the wage that is deemed “acceptable” in the UK mean that the mass-produced merchandise that so appeals to street thieves can no longer be produced economically in this country. The relatively low-skill jobs that are involved in such manufacturing are the preserve of people who are willing to work for less than their counterparts in the UK, and to do so more reliably. The future of UK manufacturing will increasingly lie in goods and services embodying training and skills.
Those who wish to have any hope at all should first be clear about their aspirations.
R Rothschild, Emeritus Professor of Economics, Lancaster
Excellent letter from the father of a friend of mine.