AIBU to want the government to subsidise high-wage and export industries rather than low end convenience and border-line viable?

[pinksauce]

The UK recent economy is based on some high end business and people in these industries then paying for convenience. Hospitality, much of the arts, call centres, town centre retail are all low-wage.

Yet, in this strange time when we are building up debt to support the economy, we are subsiding businesses that are low-wage and frankly just convenient rather than valuable.,

I'm happy to see these low end businesses close, and the retail/convenience/debt culture end - and instead only support businesses that provide real innovation and value - medicine, engineering, software products, manufacturing, etc. and are heavily export driven.

If many people and businesses couldn't save enough to manage 6 months or so, then they were not viable or sustainable in the first place and need to move on.

Arts are not valuable? That aside.l

Your sense of which businesses are of most value to the U.K. economy (high wage, export oriented) is uninformed and faintly classist.

The U.K. economy is founded on tax revenues. The largest source of tax income is from VAT. And which businesses collect the most VAT- yes the consumption based businesses- retail, hospitality, entertainment/arts. So those “low end” businesses as you call them contribute over 1/3rd of the national budget and are the primary support for the overall economy.

And what do your so called “high end” businesses with their higher wages and exports contribute to the U.K. economy? Less than 10%.

Yes, without some companies paying high wages, there would be fewer consumers with money to spend and pay VAT. BUT for the economy to stay alive consumers must spend money and pay VAT. They cannot do that if all the businesses who provide basic goods and services go bankrupt. In addition, because those businesses are also low wage, suppporting them also indirectly supports MORE consumers paying VAT than if the government supported some high wage export company like selling advanced spacecraft parts to Space X...

Surely ‘letting’ those businesses close by withdrawing support would mean masses of unemployment, how is that beneficial to the economy exactly? Less people paying tax, more people claiming Jobseeker benefits.

You are being silly.

I work in an industry that you would consider high wage I imagine.

We have been WFH and BAU the whole way through.

When it starts going back to normal I will still want to buy lunch and go to nice places with my friends around the city.

And your high end types will definitely want their nice restaurants and expensive bars running.

Also. How does it benefit society to have a handful of people raking it in and everyone else unemployed? That leads to civil unrest. Riots.

I think you're short sighted. I wouldn't hire you

If many people and businesses couldn't save enough to manage 6 months or so, then they were not viable or sustainable in the first place and need to move on.

Sorry, if people couldn't save enough they need to 'move on'? That sounds... interesting.

Shall we bring back slums and workhouses for the poor jobless folk as well?

@MrsTerryPratchett

If many people and businesses couldn't save enough to manage 6 months or so, then they were not viable or sustainable in the first place and need to move on.

Sorry, if people couldn't save enough they need to 'move on'? That sounds... interesting.

Yes...not entirely sure where they’re all meant to go but I’m sure OP has that figured out?

Also haven’t the ‘convenience’ industries like Supermarket retail/corner shops/local small businesses and their staff been what has kept us going during lockdown?

Meanwhile, back in the real world...

Hospitality is an export business. Foreign tourists quite often take advantage of it. You appear to have no grasp of how the economic ecosystem functions OP.

I'd rather the government keep their promises and pass more money onto the county councils. My local council has over £100million funding gap due to COVID (they were already making £80 million of savings this year anyway because of cuts to central government subsidy and have made massive cuts year on year.)

Most local authorities are going to end up not financially viable which given that they run schools, social care and child services is more of a worry than which fat cat gets more subsidy.

I’ll give you an idea of how chains work in business using me as an example-

I commute roughly 2 hours each way to my job when I go to the office. I pay roughly £10k per year on my season ticket with the train company. I also pay my LA parking charges of roughly £1k per year in a carpark that is safe, monitored by attendants and cameras.

Commuting this distance means I can’t take anything more than dried snacks / whole fruit as it tends to get soggy or cold. I also have to leave really early at a time when I’m not hungry. So I usually buy a coffee at the station before my train, and breakfast when I arrive to work.

I have meetings throughout the day but usually plan them so I can take a walking lunch via a local supermarket. I sometimes pop into the shops to buy things I need immediately eg if I ladder my tights / stain my shirt etc.

I have joined a local gym to my work as I am more likely to go - so I squeeze in a workout at the end of the day (or during my workday depending on meetings).

On my way home, if it’s late, I might buy dinner (nothing major usually a box from Pret). I may nip into Paperchase or Hotel Chocolat for gifts or cards for when we see family over the weekend - because I’m there and it’s convenient.

On the weekends I am entitled to free travel due to my season ticket so we may go once a fortnight as a family and spend £££ on attractions / exhibits / meals / shows etc. Basically helps me unwind.

I was talking with my DH and honestly I don’t think I would be able to function without the ‘low paying jobs’ that prop up my day. My mental health would be shit without the friendly Starbucks barista or the lady who works every morning in a local canteen and knows my order without me needing to ask, who may elicit the only non-work conversations I have in 12 hours!

Then of course there are the work from home days when I have to nip to the shops, or pay for nursery fees, or want to treat a child to McDonalds etc etc. Everything relies on each other and I bet there are a lot of people like me, who do need to pay for convenience, worried about how they will be able to continue their jobs in the office.

I'm suggesting that we need to stop paying to support coffee shops and instead subsidise people movie into things that deliver more value.

The whole VAT argument is very strange - it would be much better to aim for a very low tax economy of high value - VAT at 20% is a problem - it shows we are a consumption based economy that delivers little intrinsic value.

By moving on, I mean b come much more skilled and join new industries.

Yes, I'm a little fed up of seeing coffee shop after coffee shop - and although respect the fact that they exist, don't believe we should be supporting them to survive - just make coffee at home and get the people in much productive jobs.

The current setup drives some raking it in and others on low wages - I'm suggesting we change it, not aim to keep people in those jobs by subsidising these low value businesses.

Do we really need people making and selling sandwiches that take less than 2 minutes to make yourself?

I'm not suggesting there are not needed low-wage jobs, but just that there are many that are not really necessary, and it woulds be better if the subsidy was used to move people to higher paid roles than keep the low paid roles going.

Whatever you claim you're about, you're actually about invalidating the livelihoods and skills of hundreds of thousands of people who need to earn their living the best way they can. And for what - so you can have your selfish, bland utopia of high-end businesses and shrink down viable options for employment for millions of people?

Get real, have a and shut your fascist mouth.

@GrumpyHoonMain

I realise that - I used to do it, and then just ave myself a wobble and saved 8k per year by not pretending that office life in London was that stressful and the prices were simply stupid.

Fine if they exist - but I don't see why the taxpayer needs to subsidise a job to save you making a coffee and putting ham between two slices of bread.

Given most office jobs have found to not even need an office to be effective, we can get rid of all this commuting, lunch time ready made lunches etc. increase the UK workforce productivity and environmental impacts.

Not really sure why we really need to support people in a job to make you a cup of coffee or allow you to walk on the spot. Why don't you just pay more if it's essential to you?

Wow, you sound fun - did you know coffee shops are actually a social pastime, not just a way to get coffee?

Life is not just about ££££££.

@baroqueandblue

People are not earning a living if its reliant on government support. The whole point is they are not viable!

@undercoveraessedai

Then pay for your own social life! The ones in Amsterdam may be social, but not the ones in the UK.

It doesn't matter if they close, there are no barriers to setting another one up if there are people willing to pay for them.

Not right now they're not because we're in the middle of a global pandemic, and only starting to emerge after over 3 months of national lockdown. But you're like the worst opportunistic politicians who take a crisis and use it to redraw whole swathes of people's economic and social reality, so that they can content themselves with the proceeds of rich pickings while millions of people go under as a result.

You need to have yourself a massive wobble and wise up!

t would be much better to aim for a very low tax economy of high value - VAT at 20% is a problem - it shows we are a consumption based economy that delivers little intrinsic value.

No, no and no.
The size or value of an economy is measured by GDP and GNI.
A high value economy will generate high tax revenues. A low value economy will generate low tax revenues.

A high value economy generating low tax revenues would not be better for 99.9% of the populace because this can only happen if you shrink the State. This means literally eliminating many state functions and expenses, ie Justice system (courts, police), NHS, welfare benefits, pensions, education, roads/transport, etc.

All economies are driven by consumption. You literally can’t have any economy without consumer demand. And what do you mean by “intrinsic” value? It is the economy that generates the tax revenues which in turn provides excess funding needed to invest to create innovation. You cannot have innovation in any area (medicine, technology, sciences) without consumers buying goods and services generating tax revenues that the state then invests into research and development either through grants to universities or contracts to businesses. You don’t seem to understand that your high wage, high end innovating, exporting businesses very existence depends on the current economy ticking over.

Newsflash OP: It's not all about you ffs!

@ShinyFootball

I don't need you to hire me - I already run a very successful business and do not need any government subsidy - in fact wouldn't take it on principle.

No problem with anything you said about that you want, but equally there is no need to support these businesses from general taxation. They are easy to setup again, and could have easily survived if profits had been left in the business to manage unforeseen events.

Lol, if a tax of 19% of your net profits means your business cannot survive, then your business is very far from successful. You can’t blame taxes on profit for businesses going under.

I hate to break it to you but a lot of those ‘high value’ business you’re thinking of don’t have enough to survive six months of unpaid invoices.

We must have different concepts of maths. Low taxation on a high value economy can generate much more tax than a high tax on low value economy. Some of the most successful economies have very low tax rates. If 99% of the population need state services paid for by others rather than genuine risk sharing, then it is indicative that the majority of people are not really making a living.

Not all economies are based on local consumption alone, exports play a very important part to many successful economies - although agreed everything has to be consumed somewhere - but having high VAT typically derives from low incomes being common.

Intrinsic value is generated by innovation that grows the economy significantly. Where inflation and growth are around the same, there is no intrinsic value being generated - technologic al advancement is typically needed so that growth far outstrips inflation and labour or capital utilisation.

High value industries mean that we should be able to increase our standard of living and work less.

What about the vast costs of mass unemployment?