Sunday, March 19, 2017

Our trade unions are failing to increase our pay

We now live in a world in which unemployment can fall to a forty year low yet there is no pressure on wages because our trade union movement is, as someone once said, “timid and shackled and tame”.

With almost a million workers on zero hours contracts, and many hundreds of thousands more in faux self-employment, we now live in an economy in which the super-exploitation of casualised labour is as commonplace as it was on the docks in the late nineteenth century.

Back then workers built trade unions in order to ensure better outcomes for union members in the labour market, from which we got the trade union wage premium – the average amount by which the earnings of trade unionists exceeded those of non trade unionists.

Although the union wage premium may well arise as much from the differential age profile, or (which is not unrelated) the differential length of service profile, between union members and non-members in the workforce, the amount of the premium remains an indication of trade union effectiveness.

It is therefore worth looking at what has been happening to the union wage premium recently and this is set out in Table One.

Table One: The Union Wage Premium for selected years in the private and public sectors 1995-2015
 Average hourly earnings (£ per hour)

Trade union membership
Trade Union Wage Premium (%)

All employees
Member
Non-members

All employees



1995
7.11
8.27
6.57
25.9
2000
8.77
9.64
8.30
16.1
2005
10.74
11.94
10.28
16.1
2010
12.55
14.05
12.02
16.9
2011
12.59
14.19
11.99
18.3
2012
12.92
14.41
12.43
15.9
2013
12.95
14.48
12.42
16.6
2014
13.20
14.78
12.67
16.7
2015
13.49
14.87
13.04
14.1
Change from 1995
6.38
6.60
6.47
-
Private Sector
1995
6.72
7.52
6.52
15.3
2000
8.47
8.77
8.30
5.7
2005
10.33
10.88
10.24
6.3
2010
12.04
12.65
11.95
5.9
2011
12.01
12.83
11.86
8.2
2012
12.40
13.06
12.31
6.1
2013
12.46
13.22
12.34
7.1
2014
12.81
13.68
12.65
8.2
2015
13.11
13.98
12.97
7.7
Change from 1995
6.39
6.46
6.45
-
Public Sector
1995
8.13
8.98
6.89
30.3
2000
9.64
10.44
8.25
26.5
2005
11.81
12.72
10.51
21.0
2010
13.83
14.89
12.41
20.0
2011
14.11
15.07
12.75
18.2
2012
14.32
15.30
13.10
16.8
2013
14.28
15.41
12.85
19.9
2014
14.31
15.56
12.80
21.6
2015
14.56
15.53
13.38
16.1
Change from 1995
6.43
6.55
6.49
-


This data demonstrates that the benefit to workers of being a trade union member has declined very significantly over the past twenty years, albeit the great bulk of that decline in the private sector (where the majority of workers are employed) occurred in the previous century. In the public sector the decline has continued (unevenly) throughout this century.

For UNISON members in local government we can also compare what has been happening to our earnings compared to earnings in the economy as a whole. After 1 April 2009 a worker on spinal column point 28 on the National Joint Council pay spine earned £23,708. Seven years later, after 1 April 2016 a worker on the same pay point earned £24,904 (an increase of £1,196 or 5% over those seven years). Over the same period the Retail Price Index rose by 23% (meaning that the real value of the earnings of the worker on spine point 28 fell by 15%). Over the same period (April 2009 to April 2016), average weekly earnings across the economy as a whole rose by 12.8%, meaning that the decline in real wages across the economy (8.3%) was less than the decline in real wages in local government.

It is little wonder that the trade union wage premium is in decline when we are failing to increase the wages and salaries of workers in the largest union organised bargaining unit in the entire economy in line with either rising prices or rising wages and salaries in the economy as a whole. Under our current leadership our trade union movement is failing to demonstrate that we are worth being a part of to an entire generation of young workers facing exploitation we could hardly have imagined a generation ago.

I am therefore very pleased to have spent some of my afternoon, as Chair of Brighton Pavilion Constituency Labour Party, supporting the striking workers at Brighton’s Duke of York Cinema in their entirely justified campaign for a living wage. Our current trade union movement (under its current leadership) is failing to deliver in the fight against low pay – but that does not mean that such failure is inevitable.