Sharon Graham’s shock election as Unite’s new general secretary, replacing Len McCluskey after his decade in the top post, has sparked much speculation about its impact on the Labour Party’s internal politics. Unite under McCluskey pursued a deliberate strategy of tying itself tightly to Labour, and seeking to reshape the party – from the candidates it selects to the policies it supports to the leader it elects – into something closer to its traditional, social democratic roots. The election as leader of both Ed Miliband in 2010 and Jeremy Corbyn in 2015 would not have happened without Unite. But following splits in the dominant Unite left faction earlier in the year, the path was open for a challenger to continuity McCluskeyism, with the one-time favourite, assistant general secretary Steve Turner, facing two opponents, Graham and Gerard Coyne, who is on the union’s right, both insisting Unite needed to focus less on Labour and more on workplace organisation.
But the real importance of Graham’s victory may lie elsewhere. As I argued in March last year, Covid-19 has the potential to shift the balance of power in the economy back towards those who work. The fundamental reason Covid-19 has been such an immense economic shock, and one with long-lasting impacts, is that it disrupts how work can be performed. Right across the economy almost every kind of work has been transformed, from the need for PPE and enforced social distancing, to the extraordinary growth of working from home. Many of these changes have imposed new costs on the economy, and reductions in the supply of goods and services, and those costs and disruptions are fuelling an increase in prices and outright supply shortages – exacerbated in Britain by the government’s mishandling of Brexit.
But alongside the costs, the requirements of managing Covid-19 have imposed a more fundamental disruption. The most basic institution in a capitalist economy is the employment relation: that one person is contracted by another to perform some tasks for a certain period of time, typically with the aim of producing a profit. The economic history of the past two hundred years or more, from the creation of the modern factory right through to the sophisticated digital surveillance that Amazon and other Big Tech companies utilise, is also the story of an attempt by employers to manage and control this process.
In recent years trade unions have been reduced to a shadow of their former selves – strike days reaching all-time lows, for example – and, crucially, the global labour market has expanded as China and eastern Europe opened up to the world. The result, as the economists Charles Goodhart and Manoj Pradhan suggest in their book, The Great Demographic Reversal, has been a shift in the balance of power in the economy in favour of those who own capital, and strongly against those who must sell their labour. But as the population ages and population growth slows, and with no second China waiting to be discovered, this free gift to capitalism is fading. The consequences, many claim, will be higher interest rates from lower savings, higher inflation, and – critically – higher wages from tight labour markets.
Some of these conclusions have been challenged. US data tends to support the alternative argument that rising inequality has driven interest rates lower, as richer households have tended to save more, rather than the other way round. Goodhart and Pradhan also underplay the role of the domestic institutions that were needed to bring this massively expanded global labour market into being, such as the operation of China’s hukou registration system in helping to create a vast, mobile underclass of rural-to-urban migrant workers. They spend little time on the active destruction of trade union power by governments like Margaret Thatcher’s. But their primary claim – that we are at the end of a decades-long period in which workers were at a disadvantage – remains convincing.
From this perspective, Covid-19 has accelerated an underlying process. By intruding on the capacity of employers to set the terms of employment, it has potentially shifted some power back to workers. This shift of power is most immediately visible in the sharp wage increases now appearing in some sectors, and the desperate appeals by employers for more workers – a trend reinforced by Brexit, but apparent across the developed world. But aside from pay increases, the reluctance of many employees to return to the office, or the desire of employers to intensify surveillance of homeworkers, point to different frontiers in the struggle for control. And as the Delta variant is now making clear, Covid-19 is not going away any time soon; its impact will be long-lasting.
This brings us back to the unions. The conditions may be there for a major revival of worker power. But what two centuries of labour history tell us is that the potential for working-class struggle is never realised without organisation. With Unite and GMB, Britain’s largest private-sector unions, now led by general secretaries elected on promises to keep out of Westminster and rebuild workplace organisation, that potential may soon become a reality.