Australia’s has a record low level of industrial disputation, and record low levels of union membership. Areas of legitimate industrial dispute have been narrowed; courts have confected reasons to narrow it further. Workers have also endured several years of wage stagnation — though that is purely coincidence, according to a number of economic commentators. 

The Reserve Bank’s solution for wage stagnation — though it forecasts only a “gradual” rise in growth — is that, in the words of governor Phillip Low, “it would be a good thing” if “workers [were] prepared to ask for larger wage rises.” That, of course, is what unions exist to do, in part — unless it’s the SDA, in which case you raison d’etre, apparently, is to undermine your own members’ wages.

Lowe’s prescription — hypocritical given the RBA’s own stance on pay for its employees — ignores the context of workplace power, which has shifted over the last three decades in favour of corporations. Centralised wage fixing has been abandoned, industry-wide bargaining banned except in certain cases, the matters that can be disputed have been narrowed (employers want to narrow them still further); the current Fair Work Act operates to dump workers back to award levels if employers decide to abandon bargaining. And unions that aggressively pursue the interests of their workers are demonised as militant and corrupt. At the same time, corporations have become larger and more concentrated, giving them greater relative power in labour markets for particular skills compared to the less concentrated economy of the 1980s.

One of the key flaws in the “wage growth is coming soon” argument is the assumption that this power relationship will magically rebalance in favour of workers. But even when labour markets tighten, corporations seek to use their political influence to prevent the benefits flowing through to workers. Witness the actions of mining companies to relentlessly attack unions during the mining investment boom when companies were competing against each other for workforces for major mining construction projects, bidding up the price of engineers, maritime workers and other specialist talent. Australia was a “high cost place to do business”, they complained; Australian construction costs were far in excess of what they should be; politicians were told we urgently needed industrial relations reform to undermine the power of unions to take advantage of strong demand for labour. 

For the same reason, corporations and their representative groups like the Business Council and Australian Industry Group continue to demand industrial relations reform despite record low wages growth and industrial dispute levels. They will always push for more power over workers. Their existing power will not be readily surrendered. The relationship between workers and corporations will not automatically rebalance in favour of the former as if driven by some natural law. 

Labor has promised to give the Fair Work Commission greater powers to intervene in extended disputes and will end the ability of employers to abandon existing agreements, as part of a suite of IR changes. The Australian Council of Trade Union’s Change The Rules campaign wants to go much further and end casualisation and the growth of independent contracting and curb work visas. The CFMEU’s John Setka — fresh from victory over the government on its blackmail charge — wants a significant easing of requirements for industrial action and a significant expansion of union right of entry. But none of these changes will filter through into better wage outcomes without more industrial disputation. More strikes, more clashes between employers and workers, more workplace bad blood.

We’ve spent thirty years regarding strikes as a profound evil. That’s perhaps understandable given the staggering level of days lost to strike action in the 1980s, when it was perfectly normal for the economy to lose 1.5 million days a year to strikes (in 2017, in a workforce more than double the size, about 140,000 days were lost). But a higher level of strikes appears to be the only way the imbalance between workers and corporations will be partially restored, unless we expect corporations to happily give up the power they’ve carefully built up since the 1980s.