Unions are the great equaliser, ensuring more money goes into workers’ pockets.
Strong unions win good jobs, pay and conditions. These in turn create a healthy economy. This is why improving collective bargaining and rights for workers must be part of any growth strategy.
This Labour government came in promising a new path of economic renewal. To make that happen, we need a serious debate and strategy on wealth creation. We need to follow evidence, not dogma.
We need to face the facts. Of course, some businesses may seek to cut costs by attacking workers’ rights – but the national economic interest is bigger than their profit motive.
The fact is that the anti-worker approach has left our economy a wreck. Real wages are lower now than in 1997. Living standards have fallen for the large majority. Infrastructure and public services are collapsing, and wealth is concentrated in ever fewer hands. It’s no surprise that people are getting angry.
‘Bending the knee to billionaires has not delivered investment’
The government needs to back Britain and invest in new industries before it is too late, even if this means being investor of first resort.
The fact is that bending the knee to global billionaires, “unleashing” corporate greed, has not delivered investment. We have historically low investment rates, the lowest in the G7. A different direction is needed.
We see the results in our failing energy and water systems, where private equity owners systematically prioritise shareholder payouts over investment. And in the continuing cost of living, or “greedflation”, crisis.
Unite’s research has shown how corporate profit margins jumped 30 per cent over the pandemic. In the same period, business investment fell by 5 per cent.
READ MORE: ‘If we ducked tough choices for growth, Britain’s spiral of decline would continue’
Shareholders seized their chance to extract wealth – not build it. Businesses doing well is of course not an issue. This should lead to better pay. However, increasingly the priority seems to be higher shareholder payouts at the cost of workers and investment.
Behind stagnant investment is the long-term shift in economic power. From 1945 to the late 1970s, the workers’ share of GDP was consistently around 60 per cent – it is now about 10 points lower. Falling growth since then tracks the falling share of wages, and rising inequality.
To rebuild, we need to shift the dial of economic power back to the people. The tried and tested route to do that is collective bargaining in our workplaces. That’s why this employment bill is critical.
‘We need to cut the red tape that stops workers organising’
We need straightforward rights for trade union recognition, workplace access, and collective bargaining. We need to cut the red tape that stops workers organising and winning their fair share.
Here are three reasons why. First, in a low-wage, low-rights economy, businesses are incentivised to “race to the bottom” by cutting jobs, pay and conditions. Instead of investing in infrastructure, technology and capital goods.
Second, good jobs and wages have vital “multiplier” effects. Money extracted by billionaires disappears into offshore tax havens. Money in workers’ pockets goes back to local economies and benefits everyone.
Unite’s commissioned economic research shows that restoring collective bargaining coverage to the same level as 1996 would create a 2.8 per cent GDP boost.
READ MORE: ‘Why would any MP think moving Reeves on means swift economic happiness?’
Third, a weak labour movement means the corporate lobby has a free hand to push the political “window” their way.
This is what we’re seeing right now. We’ve had a flurry of pronouncements on “unleashing” business.
They claim that if we tear up safeguards on markets, while keeping labour regulations amongst the tightest in the world, then somehow property developers, tech billionaires, and the City will deliver a growth miracle.
That approach hasn’t worked in the last 45 years, and there’s no reason it will in the next five. I think many in the government understand very well what’s at stake. But global markets seem all powerful, and politicians fear to challenge them.
I understand that fear.
But there’s something much bigger behind a Labour government: the labour movement, the collective power of millions of workers and our communities. Show workers you’ve got their backs, and we’ll back you.
Together we can take that path of renewal.
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