The Guardian view on trade unions: part of the answer, not all of the problem
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Version 0 of 1. Britain has a trade union problem. Only it’s not the one that David Cameron would have you believe. To him, the country is being bossed about by a cabal of strike-happy union bosses, and their new best mate, the Labour leader Jeremy Corbyn. In such cliched terms did ministers describe their stupidly draconian trade union bill on Monday, when its second reading was timed to coincide with the opening of the TUC conference and its address by Mr Corbyn. In this Conservative version of events, the UK is just one picket away from being held to ransom. The facts are somewhat different, as the prime minister and his business secretary would find if they consulted their own official figures. The Office for National Statistics produces a chart showing the number of working days lost to labour disputes, stretching all the way back to 1891. The line spikes sharply higher for the General Strike of 1926, when over 1.5 million workers walked out for a grand total of 160m working days. It climbs again over the 1970s. Then comes the miners’ strike of 1984-85 – and after that the line dwindles downwards to near nothing. From the early 1990s onwards, the British workforce has been markedly quiet. Last year saw a slight bump, with 788,000 working days lost to industrial disputes, which may sound a lot – until you remember that 130m working days are typically lost every year to illness. If Mr Cameron really wants to protect British employers from the sudden loss of valuable workers, he should give everyone in the country a free flu jab: minor ailments such as sniffles and sneezes leads to the loss of 27m days annually. This is the real union problem in Britain. Our workforce is underrepresented and underorganised – and as a result underpaid. In 2015, the average Briton remains worse off than he or she was in 2008 (as measured by GDP per head). Over the longer term, British workers have lost out in real wages even more than in other rich countries. Collecting figures from the OECD, the TUC has found that the UK wage share has dropped from 65% of GDP in 1970 to 60% by the time Northern Rock collapsed in 2007. In Japan, by contrast, the wage share jumped over the same period (despite two “lost decades” in which Japanese growth has been lacklustre). Why does this matter? For a start, it means the 30.5 million Britons in work are losing out on the chance to earn more money. And as they have done so, they have resorted more and more to borrowing to keep up their living standards. It is no coincidence that during the great British pay squeeze of the past half-decade, personal debt has begun rising sharply – and is forecast to continue doing so for the rest of this decade. The result of all this collective overextension of the debts of hundreds of thousands of households is to leave the UK badly exposed to the prospect of another crash. In 2010, International Monetary Fund economists published a remarkable paper showing how in badly unequal economies such as Britain, the average worker has to borrow more. “The inevitable result is that loans keep growing,” wrote the researchers, “and therefore so does … the probability of a major crisis that … also has severe implications for the real economy.” If the bubble bursts, the mess will land all over the economy. The IMF has also published work showing that inequality produces lower growth – and it is far from the only small-c conservative economic institution to discover this truth. It’s not much of a stretch to say that the IMF, the OECD and numerous other economists would now counsel the prime minister that rather than clamping down on often imaginary or exaggerated trade union power, he ought to be encouraging more collective bargaining. As well as raising the minimum wage, the chancellor, George Osborne, ought to be legislating for more worker representation on company boards (in the private, public and voluntary sector), with the aim of ensuring that a stakeholder-based Britain has better businesses which think long-term and draw upon the skills of their workforce for the common good. Cooperation not confrontation remains the key goal. In some ways, the government and some of the union leaders are as bad as one another. On both sides many seem to prefer to refight old battles for political reasons rather than to focus on the nation’s shared economic needs. Mr Corbyn is right about this much: unions are vital and the government’s bill is a piece of political malice. But a productive and overdue 21st-century conversation about industrial relations has barely begun. |