The Australian union movement is facing one of the most difficult times in its existence. This week speculation abounded about the future of the secretary of the ACTU, Bill Kelty. Less fervent speculation was also around about the ACTU’s president, Jennie George, though she dismissed it by saying that both she and Mr Kelty had been recently re-elected unopposed for further six-terms.
Mr Kelty’s position has been subjected to speculation probably because he had a lower profile in the waterfront dispute than many had expected. Ms George, too, has not had the high profile of her predecessors, Martin Ferguson and Simon Crean. Part of the reason for that is that the Coalition is now in power and the ACTU no longer has a de-facto seat at the Cabinet table. But then, Bob Hawke, as ACTU leader had a high profile in the days of the Fraser Coalition Government. There are clearly other factors about.
Are Mr Kelty and Ms George as capable as their predecessors, irrespective of which government is in office? That is hard to judge.
But whatever their capabilities, they are working in a vastly different industrial environment than either Mr Hawke or Mr Crean. Global economic conditions are vastly different in the late 1990s compared to the 1980s. Capital is much more transportable, global transport is much cheaper and more efficient, service industries are on the rise while manufacturing is static, the average size of businesses is getting smaller and the legislative framework has changed. These factors make life more difficult for unions. If unions exercise too much muscle, capital can pick up and go to a country with lower labour costs, with far less trouble than was the case 15 or 20 years ago. Service industries with their greater proportion of casual and young labour make things harder for unions.
The result has been declining union membership and therefore a weaker financial and power base for unions. Union membership is now at 28 per cent of the workforce, according to this month’s figures. It was only 21 per cent in the private sector. Highest membership is among those aged between 45 and 54. Membership is higher in the big public utilities and lowest in services or retail which have high casual labour rates. Last month’s figures show that the number of part-time employees rose 6 per cent from 1,916,400 in August 1997 to 2,031,300 in August this year. These figures do not augur well for the union movement. Its membership is retiring. The industries it has relied on are being privatised and fragmented.
These forces are far more powerful than whether the present ACTU leadership is as capable as it was in the past. But it is still for the present ACTU leadership to either adapt to these changing forces or become extinct. Is that leadership up to the challenge, or does is still see the industrial world as it saw it in the 1970s?
The new environment is more challenging for the union movement. In the past it was fairly easy to get bulk compulsory membership from major manufacturers and utilities. Now the economic and legal framework has changed, unions must prove their worth if they are to survive.
For a time the ACTU got a buffer against changing economic conditions with a helping hand from the Labor Government. It legislated to create mega-unions, forcing amalgamations. It negotiated the Accord with the unions. These changes made it seem as if the ACTU was relevant and had power. But the resulting mega-unions were seen by workers as remote and not meeting their needs. They voted with their feet.
Capital, meanwhile, was dealing with the huge extra costs of various conditions won by unions — heavy penalty rates for overtime or work outside standard hours, leave loadings, unfair dismissal laws, occupational health and safety and so on. Capital’s response was to downsize and outsource. The unions were too successful for their own good.
All the while, of course, average weekly wages are rising faster than inflation without the need for pressure from unions. Unions are becoming irrelevant to many workers. Small wonder some are questioning the ACTU leadership’s response.
One response was a fairly lame call by Mr Kelty at this month’s ACTU conference to seek relief from the pressure of working hours and to improve job security.
It was a fizzer on two counts. First, it seemed as if the union movement had gone so far backward that it was re-fighting battles of long ago. Secondly, the union movement seemed to miss the obvious — one of the core reasons for the lack of job security and unpaid overtime was that union excesses of the past had made it too difficult for employers to continue with old ways.
The challenge now for the union move is to adapt and become relevant. It must give value to members. That means constructive engagement with employers in the business of wealth generation and improvement in living standards. It means forsaking quixotic causes and strongarm tactics that in the past only saw union members pricing themselves out of the labour market. If the union movement cannot adapt and make a constructive contribution, then it will quietly become extinct. That could leave a lot of weaker members of the workforce vulnerable to exploitation.
Whether Mr Kelty and Ms George are the people to take the national peak union body through this change is rightly being questioned within the union movement itself. If the ACTU’s constituents do encourage them to go, however, it would do no good to replace them with more of the same.