Trade unions and neoliberalism

Submitted by AWL on 12 February, 2009 - 7:49 Author: Elliott Robinson

“The trade union is not a predetermined institution, i.e. it takes on a definite historical form to the extent that the strength and will of the workers who are its members impress a policy and propose an aim that define it.” Antonio Gramsci, Unions and Councils, 12 June 1920

“If one does not know to which port one is sailing, no wind is favourable”. Seneca

See pdf version of Solidarity 3/146 for the tables of figures referred to in this article.
The impact of neoliberalism on the British labour movement is the subject of this new book. It is an encyclopedic compendium of key information about the last decade of trade unionism in the UK. To this it adds provocative and in places incisive interpretation. It faces squarely the reality of the trade unionism today, buffeted by neoliberalism. However it does not shy away from criticism of union leaderships, their politics and strategy. It provides a useful foundation to assess the recent period in labour movement history, on the cusp of an economic slump.

Neoliberalism is latest stage of capitalism and the dominant ideology since the late 1970s. The Thatcherite state introduced the neoliberal restructuring regime of privatisation, deregulation and marketisation, recasting the role and place of the UK within the global capitalist economy. This restructuring has continued and expanded under New Labour.

For the labour movement neoliberalism has meant the imposition of anti-union legislation, restricting and criminalising much of trade union activity. The role of unions in this regime is at best to act as “subaltern allies” of business and the state in managing the labour market.

Between 1979 and 1997 employment in the UK grew by 20%, from 26.9m to 31.5m. In the decade after 1997 the number of jobs grew by almost 12%. But over the whole period employment patterns changed dramatically. Jobs in manufacturing fell by more than half to 3.2m; in energy and water the decline was over three quarters. But jobs in finance and business services doubled to 6.6m; education, health and public administration also grew by 50%.

Overall trade union membership in the UK fell from an historic high point of 13.5 million members in 1979 to 7.8 million in 1997. In 2006 it stood at 7.6 million. Membership of TUC-affiliated union fell over that period from 12m to 6.7m to 6.4m. (It was 6.5m in 2008) A number of large individual unions have continued to lose membership over the past decade, although others have expanded. (See table 1)

Union density (membership as a percentage of total employees) fell from an historic high of 55% in 1979 to 31% in 1997. By 2006 it had fallen to 28%. Private sector density fell from 20% in 1997 to 17% in 2006. Public sector density fell from 61% in 1997 to 59% in 2006.

The proportion of workplaces with a trade union representative fell from 17% in 1997 to 13% in 2006. Two-thirds (64%) of workplaces have no union members at all. Only 18% of workplaces have a majority of trade union members. The average age of a trade unionist is currently 46. Workplace organisation was substantially weakened by Thatcherism. But there has been “no revitalisation of workplace trade unionism” since 1997. Under New Labour “workplace organisations remain decisively debilitated” and overall unions “no longer negotiate to any significant extent”.

The annual number of strikes has “declined remorselessly” since the peak in 1968-74. The annual number of strikes fell from around 2,000 in 1979 to about 200 through the 1990s. It decreased further in the 2000s, approaching a minimal level. This partly reflected the “tertiarisation” of work in Europe and North America, whereby strikes more directly affect service users or customers. (See table 2)

There have been few high points in industrial action under New Labour. In July 2002, a public sector strike was probably the largest industrial action involving women workers in British history. In September 2002 the ISTC took the first industrial action to defend a final salary pension scheme. There have also been a large number of unofficial strikes in Royal Mail, as well as safety strikes and no revenue days on the rail.

However a number of key disputes have resulted in setbacks and defeats. The FBU dispute in 2002-03 was settled a long way short of the £30k demanded. The CWU dispute in 2007 ended with modernisation and a paltry pay settlement. Over 800 Gate Gourmet workers who came out on unofficial strike in 2005 were sacked, with only a third reinstated. Threatened strikes over pensions in the civil service, schools and the NHS were called off for a two-tier deal. Another measure is the union “mark-up” on wages, which fell from 14% in 1993 to 6% in 2000.


Partnership has been the device New Labour adapted to develop a neoliberal trade union movement. For union leaders, partnership meant stakeholding and social dialogue on the European model. But for New Labour partnership meant unions were no longer indispensable intermediaries between employers and workers, unless they renounced class conflict and participated in the drive to increase productivity and profits. Some 220 formal partnership agreements have been enacted to shackle militancy.

Since 1997 unions have received huge state subsidies for doing the bidding of neoliberalism. Money for partnerships, for workplace learning, for training, for “modernisation” and for international work have helped to make unions to some extent the “prisoners and pensioners” of the neoliberal state.

As union membership has declined and union finances squeezed, mergers have altered the landscape of trade unionism in the UK. In 1979 there were 453 unions; by 1997 it had fallen to 245. In 1997 the TUC had 74 affiliated unions; by 2008 it was 59. Although some mergers have taken place within sectors, the dominant pattern has been the “augmentation of conglomerates” as against the development of industrial unions.

A new generation of union leaders elected since 1997 pledged to be more assertive industrially and more left-wing politically than their predecessors. However the so-called awkward squad are not an homogenous group and their record has rarely borne out these promises. Taken together, they have “posed no fundamental political threat, still less a coherent political alternative to neoliberalism”.

The turn to organising has removed mainly the rhetoric rather than the substance of partnership. Top-down managed activism has made some membership gains and won some recognition battles. Of the 566 cases referred to the CAC for union recognition since 2000, 333 were accepted, 74 got recognition without a ballot. But of the 143 ballots, only 88 were successful. Despite some 220 graduates from the TUC’s Organising Academy and more emphasise on officials recruiting rather than servicing existing members, the embrace of “organising” has not turned the tide in membership decline.

Overarching these processes has been the decline in working class political representation. By 1997 neoliberalism had made substantial inroads into the labour movement, principally within the Labour Party leadership and sections of the trade union bureaucracy. Since then they have successively introduced measures to disenfranchise the working class from politics, walling off the government from the Labour Party and hollowing out democratic channels within the party, and between the party and the unions. In 2006, 16 unions affiliated 2.6m members to the Labour Party, down from the 23 unions that affiliated 3.2m members in 1997. Nearly two-thirds of trade unionists are not affiliated.

Although unions have continued to provide funding, the book catalogues how they have successively lost control and influence over the party’s decision making. It concludes that the link may well endure in the absence of better alternatives and the “cigarette-paper” differences with the Tories. However it does not quite draw the conclusion that flows from the rest of the analysis: that the relationship has been transformed beyond recognition.

Trade unions suffered 17 years of continuous decline in the early phase of neoliberalism. But no significant revitalisation has taken place in the first decade of New Labour, despite economic growth and higher levels of employment. With the onset of the economic downturn, unions face a major struggle even to consolidate. To turn the situation around, the first prerequisite is to break from neoliberalism and reforge independent working class politics on all three fronts of the class struggle.

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