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Pros and cons of universal basic income: solution to unemployment or too expensive?
Universal basic income (UBI) is a heavily contested topic of conversation. Could it be the answer to unemployment, economic instability, and poverty, or is it too expensive and likely to cause greater unemployment rates? Here we look at some of the pros and cons of UBI and its potential impact on the labour market.
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Pros and cons of universal basic income: solution to unemployment or too expensive?
What is universal basic income?
Universal basic income (UBI) is a system in which every adult receives a set amount of money on a regular basis. This payment is unconditional, meaning it does not depend on the recipient's income, employment status, or any other criterion.
Universal– to everyone
Basic– to cover everyday expenses
Income– regularly, for people to spend how they wish.
UBI has been an interesting and controversial topic of conversation over the past few years, with various trials and studies conducted to evaluate its potential impact. While we may be a long way off from this being considered in reality, let’s look at some of the pros and cons of introducing this concept.
Pros of universal basic income
Reduce poverty
One of the main arguments in favour of UBI is its potential to reduce poverty and economic inequality. A 2022 study by the University of York found that a UBI model could cut poverty by more than half. This would be achieved through tax adjustments and guaranteed weekly payments, providing a stable income for everyone. This stability could lead to a more robust economy, increased consumer spending, more job opportunities, and a healthier market overall.
Increased consumer spending
With more disposable income, people would likely spend more, stimulating demand for goods and services and benefiting businesses across various sectors. This increased spending could also lead to higher tax revenues, which could be reinvested into public services and infrastructure.
Empowering workers
UBI would offer a safety net, reducing the pressure on individuals to accept low-paying or precarious jobs. This could lead to higher job satisfaction and productivity, as people would be more likely to pursue jobs that align with their interests.
Improve workplace conditions
It would also encourage businesses to enhance their working conditions by shifting the power dynamic to the employees. With a guaranteed income, workers would no longer be compelled to stay in jobs solely for financial reasons, allowing them the freedom to leave roles with poor working conditions.
This shift in bargaining power would encourage employers to enhance job quality, offer higher wages, and create more supportive work environments to attract and retain employees. Consequently, businesses might need to implement more employee-focused policies, such as flexible working, improved benefits, and a stronger emphasis on work-life balance, to stay competitive in the labour market.
Innovation and entrepreneurship
Many people hesitate to start their own businesses due to fear of failure and financial risks. However, UBI could provide the financial stability needed to encourage entrepreneurship and innovation, potentially resulting in economic growth for the country. This could lead to the creation of new industries and job opportunities, further boosting the economy.
Foster education and societal benefits
Having a steady income would encourage more individuals to pursue further education and training, culminating in a more educated and skilled population. This increase in educational attainment can have numerous positive effects on society, including:
Higher civic engagement: an educated population is more likely to participate in civic activities such as voting, volunteering, and community involvement, fostering a stronger democratic process and community cohesion.
Enhanced critical thinking and creativity: education cultivates critical thinking and creativity, which are essential for technological innovation and economic growth.
Reduction in poverty and inequality: education is a powerful tool for breaking the cycle of poverty. By providing individuals with the skills and knowledge needed to secure better-paying jobs, UBI can help reduce income inequality and improve overall economic stability.
Improved public health: educated individuals are more likely to make informed health choices, meaning lower rates of chronic diseases and improved overall public health.
Cons of universal basic income
High cost
Implementing UBI would be extremely expensive, requiring significant tax increases and reallocation of public spending. While it's challenging to estimate the exact cost, one analysis projected a gross cost of $631 billion – which includes the UBI payments themselves as well as the cost of integrating it into the existing tax and benefits system. Therefore, many critics argue that for this reason, UBI is not sustainable or even feasible.
Decreased motivation to work
Critics argue that UBI could reduce people's incentives to work, prompting higher unemployment rates. They fear that with a guaranteed income, people might choose to work fewer hours or not at all. If this were the case, higher unemployment rates could negatively impact economic growth due to less taxable income.
Those who do continue working while receiving UBI might be less motivated to perform at their best. With their basic financial needs met by UBI, the urgency to excel and advance in their careers could diminish and we could see reduced effort and productivity.
Challenges for low-wage industries
Industries relying on low-wage labour might face increased wage demands, as workers with a financial safety net might be less willing to accept low-paying jobs. This could cause higher operational costs and potentially drive businesses to automate more processes.
Inflation
Increased disposable income could generate higher spending, driving up demand and prices, resulting in inflation. This could erode the purchasing power of the UBI payments, potentially negating some of the benefits.
Potential inequality
While UBI aims to reduce poverty and inequality, some argue that providing the same payment to everyone wouldn't solve inequality but merely shift the goalposts. Critics suggest that a more targeted approach might be necessary to address the specific needs of different groups within society.
The debate around UBI is far from settled, and its implementation would require careful consideration and robust policy design. As we move forward, it's important to engage in thoughtful discussions, consider diverse perspectives, and explore pilot programmes to better understand UBI's real-world impacts.
Ultimately, the question remains: can UBI be the transformative solution we need to fix the unstable labour market, or will it prove too costly and complex?
If you are looking for a talented professional to join your team, or seeking a new employment opportunity yourself, get in touch with a specialist consultant today.
Interview questions to ask candidates - and what their answers mean
The standard competency question
These are the most common type of questions to ask when interviewing, and will usually start with the phrase along the lines of “Can you give me an example of when you…”. They can be adjusted to suit whichever skills you’d like the candidate to tell you about, for example, delivering excellent customer service, resolving a conflict or influencing a senior stakeholder.
Competency style questions are good for when you want to find out about specific competencies or skills the candidate has, and how they have used them to resolve previous situations. Good candidates will often plan responses to these and should give clear, thought-through examples.
Look for evidence in their answers that they can give you a clear situation, the task at hand, the action they personally took, and the (positive) result of that action - the STAR method.
The follow-up question
Follow-up questions allow you to get more detail, and look beyond the glossy prepared answer, which, although sounding impressive, may cover up a lack of detail or personal involvement. Asking good follow-up questions allows the candidate to engage on a higher level, and have to think on the spot a bit more, as they might not be as prepared for one of these.
The curveball question
If you really want to test a candidate’s ability to think on their feet, throw in a curveball or two. These can be completely unrelated to the job but may be an extension of something on their resume or relate to current affairs that you’d like them to comment on or explain to you. It will test their decision-making under pressure, and the ability to articulate an unprepared response, which can be very important in some jobs.
The hypothetical situation question
Some love and some hate these, but they can be seen as a very good example of testing rational thought and logical reasoning quite quickly. Such questions are normally along the lines of asking the candidate to imagine they are in a certain situation, and then asking them to decide, based on information and parameters provided.
The “describe yourself” question
These can come in many forms, and you can ask candidates to imagine what their previous boss or co-workers would say about them, or just to sum themselves up in a few words. This will show whether a candidate can empathize with another person’s point of view and express it, or their ability to give a succinct answer when only a few words are required.
Improve your hiring strategy with AI interview tools
Unleashing the potential of AI in recruitment
Artificial intelligence (AI) is transforming the recruitment field and altering how businesses recruit. Here are a few methods through which AI can boost the productivity and efficacy of the recruitment process:
Automate repetitive tasks
A key advantage of utilizing AI recruitment instruments is their capacity to automate monotonous tasks. Such tasks may encompass sifting through resumes, arranging interviews, and dispatching subsequent emails. AI makes tasks easier, giving recruiters and managers more time for important parts of hiring.
Streamline candidate screening
Conventional screening techniques can be lengthy and prone to human mistakes. AI can quickly analyse many resumes and identify the best candidates using predetermined criteria. This not only speeds up the screening procedure but also ensures that we don't miss any candidates.
Gain valuable insights
AI can offer crucial understanding that aids recruiters and hiring managers in making knowledgeable choices. Predictive analytics can anticipate a candidate's work performance and similarity with the company culture. It will help the hiring manager to understand if that job applicant is a good fit for the business.
AI recruitment instruments can also scrutinize a candidate's social media accounts to understand their character and principles. This understanding can assist recruiters in making more impartial and data-oriented recruitment choices. Learn more about social media screening.
An inventive use of AI in hiring is the creation of interview questions powered by AI. This tech employs machine learning algorithms to scan the given criteria and produce pertinent interview questions. The system considers the job title, skill set, and experience level. It then generates questions that accurately evaluate whether a candidate is suitable for the role.
Introducing Reed's interview question generator
Reed's interview question generator generates interview questions using AI algorithms, based on criteria given by the employer. It's a powerful tool.
The tool has a simple interface, allowing employers to enter job details and get a list of questions. You can download the list in a Word document for your interview.
You can also copy it to send to a colleague or use it in another document. The tool is helpful for hiring managers in many ways. The tool helps hiring managers in many ways.
Employers can access Reed’s interview question generator
Tailoring interviews with customizable criteria
To begin, just enter the job title, seniority level (e.g. entry-level, middle manager, board level), and industry for the recruitment process. Next, you pick a maximum of three soft skills that you desire in your ideal candidate. Options include abilities like emotional intelligence, inventiveness, business acumen, and analytical thinking, among others.
In just a few minutes, the tool will produce a collection of custom-made interview queries for applicants.
Once your questions are ready, you have the flexibility to reorder the question sequence, choose different skills, refresh the whole set or lock your favourite questions and revise the rest.
How does the tool adapt to different industries and job roles?
This AI-based interview instrument enables companies to customize interview queries according to their unique requirements. The selection criteria encompass the job position, necessary skills, experience level, among others. The instrument utilizes these parameters to formulate questions that align with the job and the company's needs.
You can use the interview question generator for any job role. Either select one from the drop-down list, or just choose your own. You can also choose from 27 industries, from engineering and manufacturing to insurance and pensions.
Reed's interview question generator can help assess candidates with relevant questions. You can use it for hiring in a tech startup or a manufacturing company.
Maximising hiring success with AI-generated questions
Skilfully designed interview queries are crucial for assessing a candidate's abilities, background, and suitability for a position. Employers can now utilize our cutting-edge interview question generator tool to aid them in making knowledgeable recruitment choices. Interview questions help to gain a better understanding of a candidate's skills. They also ensure a fair interview process, reduce bias, and improve the quality of hiring.
Utilizing the tool offers several advantages to employers, including time efficiency, enhanced candidate experience, and superior hires. The interview question generator is especially useful for specialized roles or sectors where certain skills or experiences are necessary. By creating customized questions, the tool assists employers in evaluating if candidates have the distinctive skills needed.
How to choose between candidates
Sometimes during the recruitment process you may come across two candidates who ticks all the right boxes, but you may only have one position to fill. Trying to choose between candidates who have both impressed at the interview stage, and appear suitable on paper, can be difficult. So what exactly should you be looking for when choosing between two candidates?
Experience
While it may appear obvious that a candidate with more experience is more employable, sometimes two applicants will have similar levels. It is worth considering which candidate will provide more in the specific scenario of your company. One candidate may be more suited to the actual demands of the role (remember - desirable doesn't necessarily mean necessary); another may have experience in areas you may look to expand into in the future. Yet, don't write off the value of bringing in someone from an outside industry for a fresh perspective.
Also ask yourself if you'd prefer a safe pair of hands – someone that can do the job already, but who may potentially get bored of it quickly; or someone who maybe has a bit less experience, but is ready for the next step up into this role.
Who wants it more?
Following on from this, how much the candidate wants the job is an important factor. It is important to determine whether they simply need a job or if the position you are potentially offering them is their ideal role.
Someone who wants to work in your field, and for you specifically, could bring you a lasting tenure, whereas somebody looking for a stopgap position is more likely to move on when something more suitable presents itself.
Chemistry
It is not only a potential candidate's skill set that should be taken into account during selection, but also their softer skills. A new employee with strong interpersonal skills who easily gels with you and your team will be able to start working to the best of their abilities and operating successfully within the team more quickly than others.
A candidate should be gauged on their cultural fit to the company and their fit with those they will be working with and for. Moreover, someone who is predisposed to work as an individual may not be as effective in a team that tends to work closely together. Remember – you're probably going to have to get on with them every day, so liking them is also important.
Connections
If choosing between two potential candidates is still proving difficult, it can be useful to look at what else they bring to the table. A candidate with a strong client base or background with already established relationships and connections that will bolster your company could help to secure contracts that you otherwise may not have won.
How to create a great recruitment strategy
What is a recruitment strategy?
A recruitment strategy is a clear plan that explains what roles you’ll recruit for, when, why and how. It should be tied to your overall company objectives.
Your strategy must be possible to implement and easy to communicate. While you can tweak your tactics, the strategy must always be clear.
The core aspects of a great recruitment strategy
Growth Plans
In order to scale up your workforce, you’ll need to hire – which takes time and resources.
Create a measure to help you identify which areas of your business will benefit most from increased headcount.
This could focus on return on investment or opportunities lost.
Shortcut: Unsure how many new employees you’ll need? A recruitment agency will give you access to temporary staff and contractors to help you expand quickly and risk free.
Employer Brand
Make sure your employer brand and message are attractive to your target audience, particularly over social media. A well-known brand is a big selling point to talented job hunters.
Be open and transparent about the company’s working culture to ensure you attract candidates that will match your business.
Shortcut: If your brand isn’t well known, a recruitment agency can contact candidates directly and spend time promoting your employer messages.
Skills Audit
Use your company objectives to identify developing areas of the business, then decide on the skills you will need to succeed.
Your recruitment strategy should include ways to find and bring new skills into the company.
Employers often focus on advanced digital and technical skills, but you should also consider bringing in candidates with different experiences.
Shortcut: When interviewing for a role you’ve never done yourself, your recruitment consultant can offer interview tips and support to build your confidence.
"You can tweak your tactics, but your end goals must be clear."
Flexibility
If your company needs to adapt quickly to an unpredictable market then hiring permanent staff may not be the right option.
Your strategy should include a plan for temporary staff and contractors to cover projects that are likely to change at short notice.
Shortcut: Unless you already have an advanced payroll function, it makes sense to ask your recruitment agency to manage payroll for your temporary workforce. They look after tax, holiday pay and even pension contributions – saving you a lot of hassle.
When to review your recruitment strategy
You should always be thinking about how you differentiate your company from your competitors, and how you can be a more attractive prospect for potential candidates.
Pay close attention to all aspects of the recruitment process, and make tactical tweaks throughout the year when necessary – while holding firm to your recruitment strategy.
You should review your overall recruitment strategy annually to make sure it ties in with your wider business objectives. It’s important that everyone in the company understands your goals – so be clear and concise about what success looks like and how you will get there.
Key considerations when writing a person specification
The first step is to advertise the role with clear and accurate information about the position available. Something that works alongside a job description is the ‘person specification'.
The person specification, or personal specification, is an important part of the recruiter’s toolbox. It allows you to communicate the traits you find desirable in an ideal candidate, such as education, previous work experience, and any extra traits needed to succeed in the role.
What is a person specification?
A person specification is a detailed description of the ideal professional, or candidate as we refer to in the recruitment sector, for a specific job role. It outlines the qualifications, skills, experience, and personal attributes required to perform the job effectively. Typically developed alongside a job description, the person specification serves as a benchmark against which applicants can be assessed, helping those hiring identify the most suitable individuals for a position. It ensures that recruitment processes are clear, consistent, and based on merit, allowing hiring decisions to be made fairly and objectively.The content of a person specification is often divided into essential and desirable criteria. Essential criteria refer to the minimum requirements a person must meet to be considered for the role, this could be holding a specific qualification or possessing a certain level of experience. Desirable criteria, on the other hand, is where you would highlight qualities or experience that would enhance an application but aren't necessary. This structure helps to filter candidates efficiently, ensuring that only those with the appropriate capabilities are shortlisted.In addition to technical and academic requirements, a person specification may include soft skills such as communication, teamwork, and adaptability. Personal qualities like motivation, reliability, and a proactive attitude can also be featured, especially if they align with the values or culture of the organisation that is hiring. By making these expectations explicit, employers not only attract the right type of applicants but also give those looking for work a clearer understanding of whether the role suits their profile and needs.
“Many companies rely solely on a job spec, focusing on the job and not the person. With talent more sought-after than ever, the more people-focused businesses are doing just that - focusing on the people.”
Chris Adcock, former Managing Director, Reed Technology
The five purposes of a person specification:
It makes the interviewing process more refined and streamlined
Jobseekers are able to assess themselves before applying and understand how they will fit in with the role and your business. This allows them to match themselves according to suitability and not just skills
It clarifies the two types of personal qualifications important to the employer: essential and desirable. This enables the employer to be explicit in what they want and how the candidate matches this criteria
It helps to communicate equal opportunities policies within the recruitment culture of a business. The law is very clear about discrimination. A person specification ensures you are assessing a candidate on their abilities related to the role
It means you test all of your candidates against the same list of priorities set out in advance. This helps remove bias, prejudice and personal interest, all of which can be problematic for recruiting successfully
What to include in a person specification
The person specification examples shown below are the types of information you should look for in a candidate. It’s important to know what is and isn’t appropriate for the vacancy you’re looking to fill.
For example, some roles have a legal requirement for the candidate to have a set level of training and qualifications. It can be a sensitive document if approached incorrectly, so it’s better to be safe than sorry.
Attainments - e.g. qualifications, experience, positions held
Soft skills - e.g. relationship building, public speaking, time management
Job-specific capabilities - e.g. use of different software or programmes, or team management
Personality traits - e.g. proactive, patient, motivated, attention to detail
Physical attributes - e.g. height, eyesight (note - these must be a justified requisite to complete the tasks within a role, not a preference)
For specialist advice on your industry, get in contact with one of our consultants here.
“While the employee and the employer have similar goals, ethics and job satisfaction, the employee will continue to work hard and give loyalty.”
Claire Harvey, Managing Director, Reed
Top tips when writing a person specification
Be realistic: It’s incredibly rare any candidate will tick all boxes. Ensure you know your must-haves from your nice-to-haves.
Identify existing skills gaps: The most successful teams are made up of individuals who bring something different to the department. Consider where your weak spots are and seek those out in the desired skills section.
Consider how you might assess the criteria: Can the candidate be tested or demonstrate the desired attributes in an interview situation when asked? If you can’t think of an example, it may be unfair to expect them to.
Check your tone of voice: It’s a good idea to have one or two people read over the document to check all points are conveyed in an appropriate manner and cannot cause offence.
How does a person specification ease the onboarding process?
Once a candidate has been chosen, the person specification makes integration and training much more organised because you will already be aware of what the candidate is able to do.
For example, if your specification required someone with excellent computer skills as being essential to the role, then you would only need to give a brief induction to the computer systems of your business.
It can also assist with creation of learning and development plans where they perhaps didn’t have certain desirable skills - yet.Recruitment agencies are experts in creating person specifications. Get in touch with one of our specialists for more advice on finding the best person to help reach your business goals.