Real wages in Britain have dropped further, and for a longer time, than since records began. The wage share of total income has dwindled since the mid 70s. It has dropped even further since 2010, although usually in economic slumps the wage-share recovers a bit (because profits rise faster in booms, fall faster in slumps).
The overall wage figures tell only part of the story. Both higher “wages” (the pay-outs which bosses award themselves) and higher wages proper (for the best-off workers, managers, etc.) have held up well. At the top end, they have soared. The lower-paid have suffered worst.
Britain now has a bigger proportion of workers in low-paid jobs (paid less than 75% the median) than any other rich country except the USA.
Lower-paid workers are also more insecure. At least a million workers, whose average pay is 40% less per hour than the overall average, are on zero-hours contracts. Young workers are specially hit: for the first time ever, people in their 20s are, on average, worse off than people in their 60s.
The Tories’ benefit cuts, scything about £800 a year off the average person’s budget, also hit lower-paid workers much more than the rest.
Tory economics is engineering both an increased gap between rich and poor, and increasing inequality within the working class itself — between better-paid and more secure workers and the rest.
Solidarity proposes a four-point answer:
One: rebuild trade unions! Large, strong unions both limit the gap between boss and worker, and narrow the inequalities within the working class. They mean that workers with little bargaining-power in the labour market have their wages and conditions pulled up by agreements won by the workers who have more bargaining-power.
Two: make unions democratic, combative, and solidarity-minded. Too often unions retreat into occasional set-piece protest strikes, orchestrated from above by full-time officials outside the control of the members, and geared to limiting the damage for their “core” members, usually older and better-off workers.
We accept that the unions can’t call a general strike tomorrow, or start a forest-fire of militancy with a single spark. They can throw their resources behind each partial struggle that wells up from their ranks — support, publicise, and seek to generalise each struggle.
They can, as Karl Marx argued almost 150 years ago, “consider themselves and act as the champions and representatives of the whole working class... enlist the non-unionised into their ranks... look carefully after the interests of the worst-paid trades... convince the world at large that their efforts, far from being narrow and selfish, aim at the emancipation of the downtrodden millions”.
The big unions do not do that yet. That is why we have seen a flurry of micro-unions and “pop-up” unions.
Three: insist that an incoming Labour government increase the minimum wage to the level of the “Living Wage”. It is good that Labour leaders now talk about extending the Living Wage (£8.55 an hour in London, £7.45 outside). It is bad that they deny that the minimum wage should be... a Living Wage. (The minimum is currently £6.19 an hour for over-21s, much less for younger workers, and zero for under-16s).
It is bad that they talk only of “seeing how central government could further extend the requirement to pay the living wage through public sector supply chains” and of selected “Living Wage zones” where the government would nudge bosses into paying the Living Wage by offering them “time-limited cash rebates, or funding for the costs of training or new equipment”.
The government should not try to bribe bosses into paying a Living Wage. It should compel them, and take over the business if the bosses refuse. There is nothing unrealistic about this.
In Australia — not in some imagined utopia, or in an uncertain socialist future, but in capitalist Australia today — the minimum wage is £9.61 an hour. In France — in today’s capitalist France, not in dreams — the legal minimum is £7.93 an hour. In Ireland it is £7.28.
Four: Ban zero-hours contracts, and reduce casual employment. It is good that Labour leaders denounce zero-hours contracts; bad that they commit themselves to no more action than “a summit on the issue of zero-hours contracts... to discuss... what steps can be taken to tackle... abuse”.
Some people claim that zero-hours contracts can’t be banned. They do it by way of blurring the difference between zero-hours and casual work.
They shrug: there will always be short-term tasks requiring short-term workers, always people wanting to work only irregularly or occasionally.
Bosses know the difference. A website offering them model employment contracts explains: “a Casual Worker Contract does not oblige the workers to accept the work offered to them, but a Zero-Hours Contract will oblige workers to accept the assignment(s) offered to them”.
Zero-hours contracts are used by bosses in trades where work is steady and consistent simply to gain more control over workers and limit their rights. Most use of casual contracts has the same motive. It is not driven by work really being one-off, or workers really wanting only odd days of employment.
Bosses used to say that dock work could never be anything but casual. More ships come into a port one day than the next. The work varies. Then dockers got organised — and the bosses found it possible after all to give them more regular hours and a fallback wage if no ships were in port. The same will be done in other trades if unions organise.
Not in hopeful speculation, but in grubby, unequal capitalist Australia today, bosses are obliged to pay workers a 25% higher hourly rate if they employ them as casuals. The same could be enforced in the UK.
Neither a minimum wage, nor a ban on “zero-hours”, nor measures limiting casualisation, can be made to work well without strong trade-union organisation reaching out to the worst-exploited and helping them claim their legal rights. All four points of our answer are necessary.
They will not be won without a strong socialist organisation, consistently active in the ranks of the labour movement, pushing for them. Join us to win them!