I would try to go beyond the idea that industrial deregulation was all a dastardly plot; it happened in the face of very real economic pressures, especially international pressures. If something can't be produced cheaply enough by a local workforce, protection can't hold back the tide forever, and it really does have its own side-effects on real labour incomes (through making stuff more expensive).
Also we should remember that exchange rate shifts can and did swamp deliberate tariff reductions in their effects on industrial competitiveness - the great rise in Australian unemployment around 1974 had a lot to do (as a proximate cause anyway) with the revaluation of the $A when Bretton Woods broke down, at the same time as the great Whitlam (Labor) 25%-across-the-board tariff cut. Profits, incidentally, took the immediate hit, and the wage-share was at its highest point in the mid-1970s, even as unemployment blew out. Finally, there's the 'Gregory thesis', that manufacturing competitiveness in Australia has been permanently undercut by the effect on the $A of mineral exports.
Despite all this, Australian real wages have tended to rise faster than, say, those in the US or NZ. It could have been worse. I assume a lot of that comes down to geological fortune.
Cheers, Mike scandalum.wordpress.com
On Tue, Sep 1, 2009 at 3:48 PM, Bill Bartlett<billbartlett at aapt.net.au> wrote:
> The trade unions had more power back in the 60's and 70's. But would you say
> that the de-regulation of many key sectors and privatisation of others has
> played a big part in undermining that power?
>
> Many industries operated as virtual monopolies or duopolies. Some were
> state-owned and protected from competition. This allowed unions to establish
> a grip on wages and working conditions.
>
> With de-regulation came collapse of many firms, which obviously destroyed
> the established wages and working conditions in the whole industry and new
> entrants to the industry offered drastically lower wages and conditions. Its
> still going on in some industries.
>
> I suspect that the reform of wages regulation and working conditions is more
> symptomatic of what is going on than the direct cause. If the regulatory
> changes had been attempted when the union movement had any power, they would
> have defeated the attempt.
>
> What do you think?
>
> Bill Bartlett
> Bracknell Tas
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