For those versed in trade union folklore, the battle of Saltley Gate holds a special place. In 1972, workers from Birmingham factories downed tools to support striking miners, blockading a gasworks in the city where there was a huge stockpile of coking coal. Orchestrated by a young Arthur Scargill, the blockade successfully prevented lorries from collecting the coal.
The action was pivotal in winning the strike for the miners, so it comes as no surprise that today, on the 50th anniversary of Saltley Gate, the Midlands branch of the TUC is holding a celebratory event. Scargill will be one of the speakers.
There is much talk about how Britain is returning to the 1970s, but the detour down memory lane provided by the events in Birmingham in February 1972 shows how fatuous are the comparisons. To be sure, there is some upward pressure on pay as businesses reopen after lockdown, but the idea that Britain is locked into a wage-price spiral is for the birds. Fundamental changes to the economy that have taken place over the past half century mean prices are going to rise faster than wages this year, further eroding living standards.
The factories workers surged out of to support Scargill’s call for solidarity have largely gone – since replaced by offices, call centres and warehouses. Mass pickets were outlawed as part of a concerted drive by the Conservative governments of the 1980s to weaken organised labour. The number of workers covered by collective bargaining agreements has plummeted, and in the private sector only one in seven workers belong to a trade union. Four million of the 6.6m trade union members work in the public sector, while those in the lowest-paid, highly casualised sectors, who would benefit most from the support of a trade union, are least likely to be members of one.
Just how far the pendulum has swung in the past half century was illustrated in the letter by the general secretary of the GMB union, Gary Smith, to Andrew Bailey, inviting the governor of the Bank of England to try his hand as a care worker for a day to see how people coped on low pay. Bailey has taken some deserved flak for suggesting it would help the Bank of England regain control of inflation were workers – faced with rocketing energy bills and rising taxes – to moderate their wage claims this year
The alacrity with which 10 Downing Street slapped down Bailey for his comments was also illustrative. The balance of power in the workplace has shifted too far in favour of employers – and even the Conservatives can sense there is a problem, not least for their own political survival. One thing that has not changed from the 1970s is that making people worse off has a political cost for the government.
In theory, weakening the power of unions was supposed to liberate management to bring in new ways of working that would boost efficiency. Forcing workers to accept less generous pay awards would leave more money to spare for investment in new kit and better training. Everybody would be better off.
In practice, investment has remained weak. Rather than spend money on improving skills that are lamentably poor by international standards, employers have paid themselves more and boosted the value of their assets through share buyback schemes. The 2010s were a lost decade of historically weak productivity growth and flatlining living standards. Rachel Reeves, the shadow chancellor, was quite right when she said the Conservatives had become the party of high taxation because they were the party of low growth. The current model simply isn’t working.
There are lessons to be learned from the US, where Joe Biden knows the economic model is not working well enough for ordinary Americans either. Claiming to be the most pro-labour president ever, Biden has tried to make it easier for unions to organise, a move that is showing signs of paying off. Buffalo, in New York state, recently became the first city in the US to have unionised branches of Starbucks, a firm that is certainly no friend of organised labour.
Biden has also listened to demands from unions to boost manufacturing through a “buy American” procurement policy. More generally, the White House’s strategy has been to keep the economy running as hot as possible, despite concerns from the Federal Reserve, the US central bank, about inflation. Strong growth has pulled down the unemployment rate, resulting in labour shortages.
There have been some positive signs in the UK. The TUC was heavily involved in the design of the furlough scheme at the start of the pandemic. The “national living wage” will go up by 6.6% in April, to £9.50 an hour, shielding those on the lowest incomes from the worst of the cost-of-living crisis. Firms are struggling to fill vacancies, forcing them to offer better pay and conditions.
All that said, a piece of the jigsaw is missing, and that is unions. They have a far bigger role to play in prising Britain out of its low-skill, low-pay, low-investment rut. Levelling up is a worthy ambition, but if it is to be anything more than a slogan it needs to begin in the workplace. In recent years, the balance of power between workers and bosses has been a case of levelling down. There’s no question that the UK has plenty of economic woes, but they can’t be blamed on organised labour. One of the problems is that unions are too weak, rather than too strong.
Larry Elliott is the Guardian’s economics editor
