Summary

• This summer is seeing an upsurge in strikes and threats of strikes, with the number and scale of disputes being markedly higher than in the pre-Covid period.


• However, these disputes are concentrated in the public sector, or those parts of the private sector that were once nationalised industries, where union membership remains high. Across the workforce as a whole, unionisation has fallen to less than half the rate in the 1970s.


• Trade unions’ power depends on their special status in law, which provides immunity from damages if strikers follow appropriate procedures. The Thatcher and Major governments tightened the conditions under which strike action could take place.


• These are not the only reasons for declining union power and influence. Globalisation and structural change have also weakened unionism in many countries. Within the UK increasing workforce diversity has undermined unionism, while higher levels of employee qualifications and various forms of employment regulation to protect workers have reduced the appeal of collective bargaining.


• The current round of disputes is unlikely to lead to a continuing seventies-style wage–price spiral, but government concessions to union militancy will add to public spending and mean that tighter monetary discipline will need to be imposed, with negative consequences for the rest of the economy. They will also make necessary public sector reform more difficult.


• Should the government wish to challenge union militancy more aggressively, there is a range of options, from selective strike bans and compulsory arbitration to reshaping public services, which could be adopted without compromising the fundamental freedom to join a trade union. However, this would require a coherent strategy rather than ad hoc responses made in the course of a febrile ‘summer of discontent’.

Len Shackleton

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Editorial and Research Fellow

Len Shackleton is an Editorial and Research Fellow at the IEA and Professor of Economics at the University of Buckingham. He was previously Dean of the Royal Docks Business School at the University of East London and prior to that was Dean of the Westminster Business School. He has also taught at Queen Mary, University of London and worked as an economist in the Civil Service. His research interests are primarily in the economics of labour markets. He has worked with many think tanks, most closely with the Institute of Economic Affairs, where he is an Economics Fellow. He edits the journal Economic Affairs, which is co-published by the IEA and the University of Buckingham.