Money for nothing
Before 2020, any notion that a government should pay people’s wages or energy bills seemed part socialist, part space age. Then came a once-in-a-century pandemic and a punishing cost-of-living crisis, and we rapidly saw both interventions unfold in the UK.
Fast-forward to now, and it makes a universal basic income (UBI) – that is, regular, non-means-tested grants for every citizen – feel less like a fringe flight of fancy. When mapping out the future of work, money for nothing could yet be the answer.
UBI’s history dates back centuries, with a diverse cast of fans – from Martin Luther King Jr to Mark Zuckerberg – yet the concept remains divisive.
Critics claim that UBI would remove people’s motivation to work. That it would cost a literal fortune (modelling by the Institute for Policy Research put the annual bill at £427 billion – roughly double the Department for Work and Pensions’ budget). And that giving everyone free money would only cement inequity between the rich and poor.
Advocates don’t agree. They say that the scheme, done right, could end poverty overnight. They argue that UBI discourages low pay, and lets people say ‘no’ to poor job quality or exploitation. Unpaid carers could support themselves. The workforce would be protected from creeping automation – in the shape of a financial safety net – and individuals would have the means to retrain.
There have been various UBI experiments since the 1960s (a small pilot is under way in Wales right now, for instance), with illuminating results. A 2011 trial in Iran saw inequality and poverty fall, with no mass exodus from the labour market. In fact, many worked more – using the cash to invest in their own businesses.
In Canada, a UBI scheme from the 1970s saw a drop in hospitalisations and diagnoses of mental illness. More recently, a 2020 ‘cross-synthesis of reviews’ from Stanford University spelled out clear trends: “Findings are generally positive that UBI-type programmes alleviate poverty and improve health and education outcomes and that the effects on labour market participation are minimal.”
Curiously, the greatest hurdle could yet be public buy-in. In 2016, a historic referendum resulted in a landslide: 76.9% of Swiss voters rejected basic income. While exact figures were never confirmed, campaigners proposed a monthly sum of 2,500 Swiss francs for adults (roughly £1,725 in 2014) and 625 francs for those aged under 18.
Rethinking time itself
Forget the barb that Britons are ‘among the worst idlers in the world’ – research shows that UK employees put in an hour more work than the EU average of 40.5 hours a week. But time doesn’t automatically translate into output: ONS data from 2019 ranks our productivity-per-hour below the US and France.
Factor in the grim trend of tech-connected staff working all hours, alongside rising rates of stress, anxiety and depression (amounting to 17 million lost work days in 2021/22, according to the HSE), and it’s little wonder there’s growing clamour for a four-day week (4DW).
For those who champion it, a 4DW (retaining 100% of your salary) represents natural progress: six-day work weeks were the norm until Henry Ford pioneered a five-day, 40-hour model. The upsides are near infinite. As well as better work-life balance, companies benefit from lower running costs, a smaller carbon footprint and the ability to attract and keep top talent.
And yet, the most compelling sell for a four-day week is often the impact on time itself. For instance, an Iceland trial between 2015 and 2019 showed that the majority of workplaces maintained or improved productivity. How? Because when every minute matters, workplace culture must evolve. People work smarter (not harder, but better) to ensure that fifth day stays free.
Sceptics rightly point out that not everyone has a nine-to-five, Monday-to-Friday schedule. (Recent CIPD data shows that 64% of UK employees currently work five days a week.) There are also unanswered questions about what this would mean for certain industries (like emergency services or public transport), gig economy workers, and jobs where individuals are already pushed to the edge of human capability (think warehouse staff or couriers). Yet the Icelandic pilot has shown how the system is ripe for innovation.
There, the aim was to understand the impact of fewer hours, with some organisations working the same number of days, albeit in shorter bursts, as a five–six-hour day, for example.
The innovation argument is underscored by industries that make a success of shorter work weeks, against the odds. One notable case study is Aizle restaurant in Edinburgh, where chef-owner Stuart Ralston maintained profits despite serving dinner only, four nights a week.
In June 2022, 3,300 staff at 70 UK companies embarked on the world’s biggest four-day week trial. The sheer variety of participating companies (for example, financial firms, a brewery, and a fish and chip shop) hints at a mainstream future. Likewise, the fact that 86% of firms claimed, when surveyed halfway through, they’d commit to the policy long term.
This implies that a four-day week is no passing fad. In fact, for 100 UK organisations, the future is already here.
Where empowerment meets equity
Let’s be clear up front: salary transparency is coming.
From viral TikTok accounts to US state laws, the noise grows ever louder. In 2019, a CIPD editorial stated that: “Because pay transparency is becoming more of an issue, doing nothing can’t be an option for most organisations.”
The reason why has nothing to do with inappropriate oversharing. Rather, salary transparency is where employee empowerment meets equity. This means, for organisations that strive for a fairer workplace, the future is truly bright.
Right now, secrecy over what people get paid is shown to perpetuate both the race and gender pay gap. Thankfully, pay transparency shines a light on bad treatment – both conscious and accidental. Indeed, ask any organisation shamed for their gender pay gap, and they’ll likely confess there’s a high reputational price for underpaying female staff.
The impact transparency has on equal pay is self-evident – one study found, across two decades, that posting the salaries of 100,000 academics online shrunk the gender pay gap by up to 50%. This strongly implies that forcing organisations to show their workings over what they pay – or rather, who they pay what – sparks change.
There are benefits for employers too, and these extend beyond progressive values. When colleagues know what each other earn, productivity and collaboration increases. Whereas keeping salaries a secret is linked to lower employee performance.
There’s also the upshot on workplace culture. Indeed research (carried out by YouGov) showed that, for companies who introduced salary transparency, 56% of HR decision-makers (and 49% of senior managers) felt the staff reaction was positive. Across all respondents, just 1 in 50 said it had been negative.
Granted, there is a risk of foul play. Though a pivot to pay transparency would be largely straightforward (and reliable) in the public sector, private firms could look to exploit loopholes. For proof, just look at New York City, where transparent job posts have been mandatory since November 2022. Despite the new law, some organisations have gamed the system, with preposterously wide pay bands that reveal little about the actual salary (for example, the advertised salary of the head of news audio at the Wall Street Journal was $140,000 to $450,000).
Given the momentum behind the movement, and apparent gains, employers would do well to admit pay transparency’s inevitability. Because, though the long-term future looks assured, the short to medium term poses an organisational challenge.
In Indeed’s survey, 70% of millennial and Gen Z jobseekers said a listed salary would impact their decision to apply for a role (versus 38% of 50–64-year-olds, and 28% of respondents aged 65+). This reflects a clear demand among a large portion of the workforce – demand that’ll likely only increase as the generational makeup of our workplaces shifts.
Companies that resist or ignore salary transparency measures may struggle to recruit top talent at any salary.
How employers can plan
Looking ahead and planning for an undecided future is simply smart business. Thinking about even the most unlikely of outcomes can focus company values, spark new strategy, or provide epiphanies you wouldn’t have had. Here are some compensation-based recommendations to think about:
- Make your organisation UBI-proof: Universal basic income would transform the very meaning of work – altering the dynamic between people and their employers. So, while any rollout will be decided at government level, HR teams and executives should think carefully about whether your working environment is somewhere staff want to be, beyond what you pay.
- Experiment with shorter work weeks: You don’t have to take Fridays off to unlock the potential of a four-day week. Whether it’s reduced hours within a traditional work pattern, or simply taking a sledgehammer to known focus killers (from meetings to technological interruptions), it’s possible for your organisation and workforce to enjoy the 4DW spoils. Even in industries where it doesn’t seem feasible, leaders can still innovate and flex how workers operate (using shift patterns or contracted hours, for instance).
- Embrace pay transparency: If you’re nervous about going public with every person’s pay packet, you can always ease into the initiative with job ads, then boost visibility (from the top-down) when ready. Remember, there are various ways to approach pay transparency, from posting pay ranges and median salaries to sharing benefits packages.
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