In his speech to Conservative Party Conference David Cameron told delegates "it's not just about growth and GDP. It's what's always made our hearts beat faster - aspiration; people rising from the bottom to the top". The notion of aspiration is built on the premise that by working hard and sticking to the rules people can make a better life for themselves and their families. However in order to retain its natural place as the party of the strivers, the Conservative Party needs to place a greater focus on one of the structural issues that is facing our economy: for many strivers even economic growth will not lead to a rise in living standards.
The respected Institute of Fiscal Studies has argued that households face a ten year squeeze in living standards and a decade of low wages. Recent research by the Resolution Foundation think tank backs this up, estimating that even if the economy consistently grows by 2.5%, those in the middle or bottom half of the income scale will see their living standards lower in 2020 than they were ten years earlier. People who earn £23,000 a year, so often the engine room of aspiration Cameron refers to, will likely see their earnings drop to £22,200 in 2020-21. This is not a new phenomenon as often during the boom years, wages remained static and did keep pace with the rate of growth.
Within the current economic climate, this trend looks set to continue and can be explained by a series of structural changes occurring within the UK economy. With manufacturing and medium skilled jobs declining, demand and higher wages are starting to pool in areas more typically associated with those at the top of the income scale such as banking and law. Whilst the government's education and welfare reforms are designed to solve this problem in the long term by making people more socially mobile, there still exists a current generation for whom this is a problem now.
To reflect this there needs to be a new conversation within the Conservative Party looking at how we re-connect with these often natural Tory voters. These are the people who told us they wanted to buy their council house, the ones concerned about the price of petrol and the workers the Chancellor believes resent the closed blinds of the sleeping when they return from their nightshift. This group accounts for about 15% of the population and the Conservatives need to win them back to have any hope of winning the next election.
Depressingly however, many of these voters view the Conservatives as simply the pressure group for the already rich and powerful. Recent polling from YouGov showed that 40% of voters viewed the Conservatives as the party of the rich, with 28% believing that Tories did not care enough about the poor and vulnerable. To form a majority in 2015, the Conservatives need to grow their vote share whilst in office - something that hasn't been achieved since 1974- and we cannot do this without reaching out to voters in areas like Birmingham and Manchester. When we offered these people their own council house, we used to win. When we could promise them they would be better off under a Conservative government, they used to give us the benefit of the doubt. The only time you see a lot of Tories in these areas now sadly seems to be during party conference.
To win back these people the Conservative Party needs to recognise that whilst measures like cutting the top rate of tax and supply side reform may be necessary to stimulate growth, for some strivers this just won't make that much difference. We need to step back out of our comfort zone and deliver the policies behind the aspiration message Cameron so rightly identifies. Not just to those concerned about the £40,000 cut off point for child benefit, but for those in the bottom half of the income scale for whom this is a distant prospect. By cutting fuel duty we remove a cost that many people cannot avoid, by encouraging pay transparency we can nudge large companies towards improving pay, by focusing what little money we do have on taking the poorest out of income tax we reward all those who work hard and by selling off council housing in premium areas we can invest more money into providing affordable homes for people who currently cannot afford it.
In his conference speech, David Cameron fired the starting gun in the race to win over the aspirational, striving classes. To be the 'aspiration nation' and win a majority at the next election the Conservatives must ensure that they focus this message on those that want to get on, but can't.