Union Response to the Recession – Negotiating for Jobs and Peace
Ahead of the Chancellor speaking at the Economy Session at Conservative Party Conference (1100-1230), Joe Dromey writes on how unions have helped protect jobs during the downturn.
Despite the right wing press warning of growing union militancy, this recession has been notable for the lack of industrial unrest. On average, there have been 734,000 working days lost each year to strike action. That sounds a lot. But it is the lowest rate of any recession on record. During the recession of the 80s, the figure was 4.3million days per year, and in the 70s it was a staggering 9.9million.[i]
There are two very obvious differences between that era and today. First, union membership has fallen from a peak of 13.2million in 1979 to its current level of 7.3million.[ii] Second, unions are acting within a more restrictive environment following the toughening of labour laws during the Thatcher era. But neither of these factors can explain the scale of the change. With days lost to strikes at just 7% of the level of the 70s, something else is at play here.
The relative industrial peace is due, in no small part, to the way unions have responded to this recession. With massive pressure on employers in both the public and private sectors, unions have shown remarkable restraint and a willingness to compromise. They have often been willing to accept tough settlements in order to prevent redundancies.
Across the public sector, unions have reluctantly accepted a prolonged period of pay-freezes or below inflation pay-rises. In local government, where the cuts have been particularly severe, they have worked with councils where possible to mitigate the impact upon their members. And in the private sector too, flexibility and compromise have been the norm. At BAE Systems in Warton, the unions helped save hundreds of jobs through devising the Employment Retention Scheme, which involved staff taking periodic unpaid leave. At the Vauxhall plant at Ellesmere Port, Unite brokered a deal to drive up productivity through more flexible working and a long-term pay settlement, thereby securing the contract to build the new Astra.
Obviously this can’t go on forever. Below inflation pay-rises are eroding the real pay of employees, pushing more into working poverty. We need a prompt return to sustainable growth in order to reduce unemployment and reverse the decline in real wages. Unions are right to demand urgent action to make this happen. But by working in partnership with employers during the recession to prioritise jobs, unions have helped keep unemployment far lower than it might have been.
When we do finally escape the recession, we need to learn from this experience. The measured and pragmatic response of unions has been good for employees; for employers; and for the country as a whole. Through working in partnership, unions have made the best of a terrible situation and prevented hundreds of thousands of job losses. We need to look at how such partnership working can be maintained in the recovery; with union not just protecting and representing their members, but also working with employers to drive productivity for the benefit of all. By doing so, we can help build a new and more sustainable capitalism with social partnership at its core.
[i] ONS, Labour Market Statistics September 2012
[ii] BIS, ‘Trade Union Membership in 2011’, Nikki Brownlie 2012
Posted in: Blog Posts |Tagged with: economy, ipa, jobs