Writing: Laith Al-Khalaf
Illustration: Emily Donnelly
The UK working class has seen an unprecedented fall in wages. This decline has only ever been matched by Greece, and in real terms, workers have seen a squeeze of nearly 10% adjusted for inflation. These are not the deductions of a Bennite faction of the Labour Party, but of the impartial, technocratic Institute for Fiscal Studies who have concluded that British workers have seen a “lost decade” since The Great Recession in 2008, characterised by falling pay and precarious work. Whilst similar stagnation has been seen across mature Western economies, particularly those in Europe hit hardest by austerity, the British case appears to be a curious anomaly. Indeed, Spain, Portugal and other European economies who have faced far harsher cuts to the public sector, poorer growth, and a debt crisis have all maintained a stronger wage growth than the UK.
More perplexing, perhaps, is that such a fall in pay packets has also coincided with a precipitous fall in unemployment to a 40-year low, leaving economists who believe in the negative correlation between unemployment and wage growth scratching their heads. The UK seems to have forged itself a new labour market, characterised by shit jobs for all.
At the core of this situation lies the UK’s notoriously unregulated labour market. Since the crushing of organised labour in the 1980s, the UK has had the most flexible work regulations of any country in the OECD - something Tony Blair once boasted about to business leaders. But now, Blair can be seen as the primary culprit for the UK’s decline in wages and job security. British workers have fewer protections than Polish workers, are easier to dismiss than French workers, and have a vastly lower minimum wage (PPP adjusted) than most OECD countries. Add to this the rise of precarious zero hours contracts, “selfemployed-work,” and the gig economy, and it all amounts to workers having marginal bargaining power relative to capital. This imbalance lies at the heart of stagnancy in wage growth. Capitalism requires, above all else, a struggle between capital and labour, which determines demand and allows for a diffusion of tensions between the two. However, in the UK, workers have little power to negotiate salaries, namely because the power of the sack is constantly looming.
This is by no means a new development. Since the 1980s, the UK has waged war on organised labour, most clearly seen in the destruction of the once lively trade union movement. At the time, the union movement’s importance in the UK could not be overstated, bringing in millions of new members and clashing hugely with governments of the day. However, since the literal and metaphorical crushing of the unions in the Thatcher era, all of that has changed. To quote Richard Hyman, “to be a union member has ceased to be a social norm”. Often times, these clashes were dramatic and draconian, as seen at the Battle of Orgreave; others were subtle, inconspicuous, and legislative. The data lays this bare - with the density of workers in a union halving in 40 years, it is no coincidence that this has coincided with stagnant wage growth for most workers.
The solution to problems surrounding insecurity and wage growth is not a reversion, it is a resurgence and an adaptation. The fact is that workers are facing a far more precarious and uncertain landscape than ever before, and only a strong, robust union movement can tackle this. There has already been some success in this realm. The Deliveroo drivers’ strikes show exactly how collective action can tame the worst excesses of the gig economy. However, the demands need to be bolder and more synchronised with the struggles of other workers.
Collectively, a “gig economy union” could ask for sizeable demands around “self-employed” labelling, sick pay, and secure shift patterns. These should further cooperate with the classic trade union framework of UNITE, TUC, and UNISON so that workers are not being pitted against each other. Furthermore, action should not be limited to the gig economy, and the “norm” of belonging to a union needs to be reintroduced, so that public sectors workers facing a pay cap, as well as those exploited in the private sector, feel entitled and emboldened by belonging.
There are a number of methods to help break the shackles chaining workers down. Corbyn’s platform around reviewing and scrapping aspects of existing trade union legislation is certainly a step in the right direction. However, it is McDonnell’s innovative schemes on cooperatives and workers being on company boards which remain the pillar for a resurgent labour movement. The cooperative agenda has been absent from Labour party platform for about 40 years and has been consigned to the Foot era. Yet plans which allow workers the ability to purchase their places of work would not only address issues over pay and insecurity, but could extend democracy to the workplace. Moreover, having workers on the boards of companies allows for proper representation of workers’ interests and is responsible for far greater protections in Northern European countries.
Such a plan is not only moderate, but somewhat diffuses the antagonism between capital and labour. Additionally, a resurgent trade union should be willing to combat current issues, particularly issues around climate change which were not on the agenda 40 years ago. Whilst 100 companies produce 71% of greenhouse gasses, it is the workers who suffer most acutely, and it is in their interests to demand action to save their livelihoods. Although many portray green politics as antithetical to working class politics, it should be the job of the resurgent labour movement to synthesise the two and provide a prosperous, green standard of living for workers. All of these issues are interlinked and point to one clear conclusion: that without a resurgent labour movement, the stagnancy and insecurity for British workers will not end. Three decades of neoliberalism has consigned British workers to be some of the least protected in the industrialised world, and there is no way to combat these conditions that doesn’t involve organised labour.
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