Blog: Who are working people and why is growth good?

By Neil Small, Emeritus Professor of Health Research at the University of Bradford.

Keywords: Fiscal policy, growth, UK Parliament, working people.

Image from Pixabay on Pexels.com – free to use (Common Collective License).

Introduction

At the start of her 11^th June 2025 speech on the spending review in Parliament, Chancellor Rachael Reeves said her intention was “To make working people in all parts of our country better off.” “Working people” is a widely used phrase in contemporary UK politics. Frequently said by Sir Kier Starmer and his Ministers it has spread across the aisle to Kemi Badenock and her front bench, sometimes slipping into the alternative “Hard working families”.

“Working people” and “hard working families”, we are told, will be better off through a policy to stimulate and sustain growth. Underpinning this assumption is the belief that growth is enhanced by financial incentives. “No Income Tax, Employee National Insurance or VAT rises” are accompanying pledges.

The “working people” terminology is problematic.

There is an assumption that people know what the phrase means and that it’s self-evidently a good thing to plan fiscal policy with just this group in mind, or with this group predominantly in mind.
It separates the interests of “working people” from others – children, adults unable to work and older people. The pledge not to increase tax that takes money from “working people’s” pockets may increase numbers in other groups who are living in poverty. Retaining the two child limit on benefits and cuts to Personal Independence Payments are two examples.
It is linked with a preoccupation with growth, equated in the prevailing political discourse with increases in GDP, a measure whose limitations have been evident throughout its history. There are other ways to conceptualise and measure growth and alternatives to growth as a policy imperative.

Conflating “working people” and growth also assumes that the economy is driven by wage earners. It isn’t – there is a major element based on “having” rather than “doing”. Brett Christophers, in his 2020 book Rentier Capitalism, calls this a proprietorial rather than an entrepreneurial ethos. Considerable amounts of income come from what you own or control, from “rent” or capital. (“Rent” here means income generated by exclusive ownership or control of a scarce asset of some kind. This includes the commonplace understanding – flats and houses – but it also includes any income generating assets, privatised infrastructure for example). Rent going to the asset-owning elite increases faster than the incomes of the “workingperson”, look at the housing market and the profits of the privatised utilities.

As to control of productive capital Thomas Piketty in Capital in the Twenty-First Century (2014) (with due regard for Marx) tells us, returns on capital always beat returns on work. Those who gain most from wealth creation are not “working people”, they are rentiers and capitalists.

These different sorts of income don’t have the same relationship with “growth”. Rentiers sit on their income-generating assets. In contrast, those who control capital seek to forever expand their activities. If an area doesn’t make a profit it’s not developed. Between them, rentiers and capitalists are bad for any wish to promote a more equal society or for moderating the demands made on our beleaguered planet.

Who is a working person and who isn’t?

What is a working person? We might simply say it’s someone who is paid for what they do and whose pay is taxed so they contribute to the public purse. It’s of note that 8.51 million people over state pension age paid income tax in 2024/5 (HM Revenue and Customs accessed 24/6/25). Some of these qualify as “working people” in Starmer’s terms, others are taxed because their private pensions push them above the tax threshold. Many people receiving welfare payments are also working people – paid for what they do (albeit not paid much which is why they are getting welfare payments). Even more are doing what is essential work, things Nancy Fraser in Cannibal Capitalism (2022) calls social reproduction, caring for those who will make up the future workforce (children) or those unable to work (including older people and disabled people.) Separating social reproduction and economic production, and prioritising the latter, is the quintessence of short-termism. It also perpetuates a false and invidious distinction, false because social reproduction ensures the future and bolsters the present workforce during periods of incapacity, invidious because it helps justifications of inferior status in wages, working conditions and job security for a gendered and often racialised social reproduction workforce.

A “working person” is more likely to be serving coffee than hauling nets on a trawler or working in the steel industry. Around 10 times more people work in coffee shops and cafes than work in UK registered fishing vessels (96839 in the former in 2024 and about 10000 in the latter in 2022 – figures, respectively, from ibisworld.com and gov.uk – both accessed 24/6/2025.) There are 37000 people directly working in the UK steel industry (House of Commons Library accessed 30/6/25). I’m not suggesting people in coffee shops don’t work hard, but why is growth in service industries and growth in industrial or food production treated the same way?

The policy story.

The assumptions underlining making policy to benefit working people are both political and economic. Politically it is seen as a device that both satisfies a residual trope inherent in Labour’s name and origin story and that heads off a buoyant populism that is targeting “ordinary people”. Economically it is professing a belief that “working people” deserve to keep as much of the income they earn as is feasible and that this incentivises them to work and encourages them to spend. This combination fuels growth. This is not a simple proposition. The word “deserve” implies the value judgement that work is good and that it’s good to spend what you earn. But different people create different amounts of wealth and get different degrees of financial return for the work they do that is not coterminous with the value they produce or how hard they work. We could also construe “deserve” in a social rather than an individual way and ask, “what is the social good work does?” A person marketing tobacco may well be paid more than an oncology nurse. We also need to acknowledge long running concerns about consumption being a social good. In his 1973 book Small is Beautiful E F Schumacher offered a summary that is hard to beat, “increasing standards of living based on consumption is absurd as a goal of economic activity and development – we should maximise well-being while minimising consumption.”

Conclusion.

There is a destructive nexus of “working people” and “growth” in our political discourse.

Talking about working people and about growth does not generate a convincing narrative. “Working people” is both unclear and divisive. “Growth” is too simplistic; it also ignores the collective experience that the rich benefit more than the poor. A policy story, at the very least, would need to capture why working people having more disposable income is better than a policy to target, for example, reducing inequality and lifting all people out of poverty. A policy story also needs to explain what growth is for and how it can be reconciled with an ecological and sustainability agenda. Trust in parliamentary politics is at a low ebb. That trust will slip further away if this nettle is not grasped.

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Neil Small is Emeritus Professor of Health Research at the University of Bradford. He is a Fellow of the Academy of Social Sciences.His two most recent books, both published by Routledge in 2023, are: