Striking times

More warnings of a summer of strikes in this morning’s Herald:

“A surge in workplace strikes could hit New Zealand because of tough economic conditions, an employment relations specialist says.”

Fred Adelhelm points to workers struggling with rising food and fuel costs and a few recent high-profile wage deals putting unions under pressure to seek increases of 5% or more. This may lead to strife he says:

“The gaps between what employers are prepared to pay and union demands are unusually wide and are unlikely to be bridged by negotiations alone.”

“These opposing forces are going to make wage negotiations fairly robust for the rest of the year. A spike in strike activity for the remainder of 2008 is a distinct possibility.”

This analysis echoes Andrew Little’s warnings in April. I posted at the time on the gap between Little’s rhetoric and the reality of a quiescent workforce. Adelhelm has raised the issue again, and there is more justification to make such a prediction now.

But I’m still sceptical about a summer of discontent. Workers may be amenable to arguments about the bottom line if employers are willing to share financial infomation and do deals around job security, work/life balance and other important issues.

One point in passing. The Herald reporter implicitly makes a pitch for the Employment Contracts Act 1991 and gets things wrong:

“For the year ended March, there were 26 work stoppages, down from 40 over the same period last year, reflecting an overall downward trend since the early 90s.”

Take a look. Stoppages (as measured by NZ Statistics) started falling in 1977 and continued falling to historically very low levels before 1991. The ECA did not result in a marked decrease in industrial action. Them’s facts.

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12 Responses to “Striking times”

  1. macdoctor01 Says:

    I expect the October tax cuts will defuse this somewhat. If National get in and proceed with a February cut as well, it may actually turn out to be a fairly quiet summer.

    Them’s facts.
    No. Them’s statistics. Not at all the same thing as facts…

  2. jafapete Says:

    MacDoc, If they’re my statistics, they’re facts!

    Seriously, it’s a series of simple statistics (i.e. measurements), and I did note that they are “as measured by Statistics NZ”. In fact, these figures overstate the trend from 2000 relative to that before 2000, since from January 2000, complete strikes and lockouts that result in the loss of fewer than the equivalent of five working days are excluded. Prior to this, those that resulted in the loss of fewer than the equivalent of 10 working days were excluded.

    Whe all is said and done, the trend is clear and undeniable: stoppages had been trending down for 13 or so years before the ECA came into effect. They continued to fall. I could argue that they fell at a lower rate after the ECA, but you’d expect that. See, I’m trying to be balanced!

    But you are absolutely right about the tax cuts taking a little of the heat out of the situation.

  3. Inventory2 Says:

    One question JP – will the “summer of strikes” take place regardless of who wins the election, or is the EPMU keeping it up its sleeve in anticipation of a change? OK – that’s two questions, but maths was never my strong point!

    I2, You make the classic mistake of assuming that the members of the union are going to drop tools and walk out the door like zombies the moment the union gives the word. In the real world the members have their own ideas about whether or not it’s worth losing wages to go on strike, and if they are not convinced, they won’t.

  4. Steve Withers Says:

    If the count of strikes confirm that strikes declined in number, then strikes declined. Trying to dismiss that as statistics (Oh! A bad word!) is just dog whistling……and ignores the truth in what is being said…..Never good.

    These “narratives” are infectious wee memes…….and live on despite the truth being different and opposite. For example, huge numbers of people still think the song “Walking in Memphis” was written by Bruce Springsteen….when it was actually written by Marc Cohn.

    The Springsteen thing just won’t go away, despite being flatly wrong.

    So it is with much that we (and journalist are included in “we”) think we know.

    Steve, you’re right. However, strikes can also be measured by person days or hours lost, giving radically different results when the teachers go out on strike. Because that measure is so very prone to distortion, I prefer to use numbers of stoppages.

    The thing about statistics is that they don’t lie, but they can mislead if you aren’t knowledgeable enough to understand them.

  5. macdoctor01 Says:

    If we are talking statistics, rather than facts, then I should point out that strike action frequency has not been demonstrated to be effected by any legislation beyond an outright ban. If I recall correctly, the only proven correlation is between strike frequency and GDP per capita – an inverse relationship.

  6. Inventory2 Says:

    Great answer JP – except that you completely ignored the question(s)!

  7. roger nome Says:

    i also doubt that there will be a significant spike in strike action. The ERA hasn’t reversed the collapse of multi-employer bargaining that occurred under the ECA, which means that the industrial strength of unions is much weaker than it used to be.

    Until awards are brought back, striking levels will never return to what they were in the the late 1970s-mid 1980s.

  8. roger nome Says:

    oh, and btw macdoctor, you just don’t have a clue. the awards system made union organisation possible in many places where it is no longer the case. that’s why unon density went from 55% in the late 1980s to 20% from 1996-present. obviously with less union members there’s going to be less striking.

    i could explain the technicalities of it to you but it would be a waste of m time.

    Nome, getting a little personal there. MacDoc means well.

  9. jafapete Says:

    I2, No, the answer was implicit in what I said. I’ve worked as a union official and know (1) how reluctant people are to go on strike even when there are good reasons to do so — unless the employer has been particularly bad — and (2) how much union officials actually avoid getting into the situation where striking can’t be avoided.

    Remember, union officials spend just about all their time compromising. If they didn’t, they’d get very little done. Organising a strike is incredibly time-consuming, take it from me.

    So, I don’t know what the EPMU’s plans are, but I am certain that they are based on what is best for the members, and don’t involve industrial action that isn’t absolutely necessary.

    MacDoc, Off the top of my head, strike activity can be shown to be related to the level of inflation and the level of economic activity. The former provides the incentive to strike when wages fall too far behind prices. But we have a long way to go before we reach the levels of inflation of the mid-1970s-early 1980s. [Edit: I’ve just gone and looked at Nome’s graph, and that is what it shows, wage rises being closely related to price inflation.]

    Nome, thanks for adding that. I’ve been pointing out to people for years that the ERA has never been road-tested under rough economic conditions. I can’t see much reason for industrial action by workers under the ERA any more than was the case under the ECA, particularly with rising unemployment. We shall see.

  10. roger nome Says:

    pete –

    Perhaps i was a bit bluntly honest with macdoctor , but i wasn’t malicious or personal.

    Also, i agree that inflation and economic activity can drive industrial action, but i think that the industrial strength of unions, and the strike laws have a huge influence as well. i.e. if there’s far fewer union members and you can’t legally strike for 90% of the year (which is currently the case) then there’s going to be less striking.

  11. macdoctor01 Says:

    JP: You are right. My comment should read standard of living rather than GDP/capita as this encompasses inflation.

    Roger: You are also right. I absolutely do not have a clue what you are talking about! Awards systems? Union density? What has this to do with strike frequency? People don’t go on strike because they have more or bigger unions, they go on strike because they need more money. The only exception to that truism is when unions are banned (or unbanned, of course). As JP correctly points out, organising a strike is a big deal – only a total WOMBAT* would do it to score political points.

    *Waste Of Money, Brains And Time.

  12. roger nome Says:

    macdoc –

    Striking is severely restricted at the moment. A union can’t strike for political reasons, in support of another union, or outside of a designated narrow period, after an agreement has collapsed. That means less striking. But you were ignorant of all those things i guess.

    Also, 55% of the workforce used to belong to a union in the late 1980s, and now 20% do. The decline in union membership occurred over just 5 years, and was a direct result of the employment contracts act (again, no doubt something you’re ignorant of). Obviously with less union members there’s going to be less striking.

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