Up the workers

Written by Henry McLeish on 19 January 2018 in Comment

Former First Minister Henry McLeish on why more protection is needed for workers in Scotland

Henry McLeish: Picture credit - David Anderson

The Scottish economy is undergoing a radical transformation. Some of this is obvious and is recorded monthly in GDP or GNI figures, unemployment and employment statistics, exchange rates and trade flows.

What is less obvious, and rarely receives attention, is the revolution taking place in the labour market. Workers are experiencing a tumultuous phase in the struggle between ‘labour and capital’, with much more to come in the next decade. 

Economic, technological and market changes in our information society, growing fears about the security, stability, worth and dignity of work for millions of people and the threats to workers’ rights and protections, as Brexit creates a potentially menacing future of more free market thinking, are deepening anxieties.

Indeed, concerns are growing that things could get much worse for many workers, including the younger generation, the ‘just about managing’, to use the Prime Minister’s description, and for those who have failed to benefit from the literacy, education and skills opportunities on offer. 

The spoils of economic success are already unfairly distributed, and both income and wealth inequalities across Britain are amongst the worst in Western democracies. This raises important questions about economic policy, the philosophy of work and the appropriate mindset required to take us forward. 

We are now realising that even the limited sense of control we thought we had over our futures is fast disappearing. But we can make changes and create an economy that works for the many.

There is nothing about capitalism that must lead to mounting economic insecurity and widening inequality. So where do we start?
In his famous ‘white heat of technology’ speech in 1963, PM Harold Wilson said: “We must use all the resources of democratic planning, all the latent energies and skills of our people, to ensure Britain’s standing in the world.” 

The emphasis on democracy is critical to tackling the excesses of the market and dealing with the new challenges facing the workplace and society, challenges that are complex and inextricably linked.

For many, the labour market has become a source of insecure work where there is no decent pension prospect, hours of work are unpredictable, often insufficient, pay is limited to national minimums, harassment is commonplace, employee rights limited, and there seems little respect for the worker and hardly any sense of future or worth built into the job – conditions of work which gave rise to the Trades Union Congress 150 years ago. We provide more government subsidy to support ‘in-work poverty’, and prop up low pay employers, than any other European country.

The gig economy and the Uber approach to workers is another symptom of a labour market determined to drive down pay and conditions under the guise of self-employment and extending choice. 

The continuing advance of robotics and technology brings challenges and opportunities. Few would dispute their benefits, but who is in control, who is driving the aspiration, what safeguards exist for people and workers and who oversees the impact on society?

America’s five largest technology companies: Apple, Alphabet (Google’s parent company), Amazon, Facebook and Microsoft dominate the economy and their respective markets. Unlike previous giants of industry who sought competition and tried to avoid becoming monopolies, these tech titans are near monopolies who have little interest in competition. Again, questions must be asked: who decides what they do, who benefits and who is responsible for the impact on society? Or do we just accept this is the ultimate in free market excess?  

The facts are startling: Facebook has 77 per cent of mobile social traffic and controls the social feed of two billion active monthly users – nearly a quarter of the world’s population; Google controls over 81 per cent of the search engine market and takes 54 per cent of the search advertising; Amazon takes one of every two dollars spent online; Apple and Google provide the operating systems for 90 per cent of the world’s smartphones; Microsoft controls almost 90 per cent of the operating system market.

The power of these five companies presents challenges for governments, but the most important and scary fact is that five organisations own an unprecedented amount of personal and private data.

The economy and workplace require new thinking and the imaginative involvement of government and wider society. Quality is probably more important than quantity. This is not a question of opposing change or being against progress, but it is about a completely different mindset in relation to the struggle between labour and capital and a realisation that there are bigger and more important issues at stake than just the profit and loss accounts of tech giants holding society to ransom, or employers being mean and disrespectful to their workers.

Maybe Scotland can give a lead. Progressive trade unionism needs a bigger role. The social partnership model of the Nordic countries helps reinforce the links between work and society and the need for dialogue. In the UK, we have a Financial Conduct Authority which regulates financial affairs. Why don’t we have a Labour Conduct Authority in Scotland to provide oversight and regulation in the workplace and labour market?

We don’t have to change our constitutional status to give a greater priority to working people. There is an urgent need for democratic planning.

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