Unions – Through the

Recession and Beyond

David Coats, Research Fellow,
The Smith Institute
Summary
• Economic prospects
• Employment and unemployment
• Changing labour market structure
• Fiscal consolidation and the “age of
austerity”
• Implications for union strategy and
growth prospects
 UK GDP Growth 1950-2012 (%
change on previous year)
(Source: HM Treasury)
Global growth prospects (Source: IMF)
The recovery could be...
• Sluggish...
• ...jobless...
• ...and put at risk by rapid fiscal
consolidation (spending cuts)
Where have jobs been lost
Recession speeds up structural change
total em ployment change Apr-June 2008-2009

7%

9%

84%

Manual, unskilled, admin Care and sales Knowledge associated

© The Work Foundation.

A recession of the North, Midlands and
Wales
Highest increases in:

• Blaenau Gwent, Wales

• Swindon, South West

• Cannock Chase, West Midlands

• Corby, East Midlands

• Kingston upon Hull, Yorkshire

Also significant rises in the

core
cities outside London
Skills key determinant of recession
impact
Places with low skills being
affected the most

Places with high skills being

affected the least

Other characteristics affecting

impact:
•Employment in
manufacturing
•Financial services
employment outside SE
and Greater London

© The Work Foundation.

 Unemployment 1979Q4 to 2009Q2
ILO measure – all those who looked for work in 4 weeks prior to survey and able to start a job in 2 weeks time; claimant count all those on unemployment register in receipt of
unemployment benefit. Source: Labour Force Survey, Office for National Statistics

4000

ILO measure

3500
Claimant count

3000
millions, UK, seasonally adjusted

2500

2000

1500

1000

500

0
1979 Q4 1981 Q4 1983 Q4 1985 Q4 1987 Q4 1989 Q4 1991 Q4 1993 Q4 1995 Q4 1997 Q4 1999 Q4 2001 Q4 2003 Q4 2005 Q4 2007 Q4

© The Work Foundation.

Where will the jobs be in 2020?
Workforce in 2020

33%

52%

15%

Knowledge associated jobs Care and sales Manual, admin, unskilled

Public and private sector
• Private sector: job growth in sectors
where unions are weak
• Structural change continues to exert
downward pressure on union
membership
• Changing employer
attitudes/policies?
• Public sector: Cuts, job losses,
deteriorating industrial relations?
•
 Deficits General Government Fiscal Balances 2003 - 2014 ( Source : IMF )

2002 2004 2006 2008 2010 2012 2014

-2

-4
Percentage of GDP

USA

-6 Euro area

Germany

Japan

UK
-8
Major advanced economies

-10

-12

-14
 Debt
General Government Net Debt 2003-2014 Source: IMF

160

140

120

100
Percentage of GDP

USA
Euro Area
80 Germany
Japan
UK

60

40

20

0
2002 2004 2006 2008 2010 2012 2014

© The Work Foundation.

Threats
• Unions fail to adapt to the changing
world of work?
• Structural change accelerates and
union membership plummets?
• Public sector trade unionism under
threat?
• Change of government and hostile
public policy?
Opportunities
• Job quality not as good as it
could/should be
• Employers know that two-thirds of the
workforce is not “engaged”
• Sickness absence
• Rising willingness to litigate
• Managing change in the public sector –
a public sector social contract?
• Can unions offer solutions – for
employers as well as workers?
Questions
• How do you think your union is doing in
the recession?
• Should unions be rethinking their
“offer” to appeal to a more skilled and
aspirational workforce?
• How can you develop the strategic
capacity to make the best use of the
opportunities?
• What needs to be done to reshape
employer opinion and establish a new
employment relations consensus?