Most people today are individually dealing with the rising cost of living: cutting back, looking for a better paying job, taking on “side jobs”, and so on. But not so long ago many workers worldwide and in Aotearoa, New Zealand, approached the same problem in much more collective ways.
From the late 1960s to the early 1980s – sometimes referred to as “the long 1970s” – the trade union movement used strikes to combat the effects of chronic inflation and a deep economic crisis on workers. These were often successful both in Aotearoa and around the world.
In many ways, the long 1970s were similar to today, a turbulent time of profound transformation, social polarization and economic decline. After the long post-war economic boom, the so-called ‘golden age’ of capitalism came to a halt in the late 1960s. After the oil shocks of the 1970s, a long-lasting social and economic decline set in.
Largely in response to this, strike levels were reached historic peaks in many countries. As a British journalist Andy McSmith wrote of the UK’s 1978-1979″winter of discontentit was simply “irrational not to strike” as inflation was eroding wage packages. In Aotearoa, New Zealand, for example, inflation averaged 11.5% in the 1970s and peaked at 17.2% in 1980.
Collective resistance was not only organized on the shop floor. There were also consumer campaigns such as the Campaign against rising prices in the 1960s and 1970s, usually organized by (unpaid) female housekeepers, and often supported by trade unions.
Many unions mobilized to get better wages – often because of workers’ demands over declining real incomes. Millions of workers around the world went on strike to keep their wages up to inflation, in many cases securing wage increases above inflation.
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Defending living standards
In Aotearoa, New Zealand, as historian Ross Webb has arguedFrom the late 1960s until about 1984, the Federation of Labor (FOL) adopted a largely successful strategy to defend living standards. They argued that employers and governments were trying to place the burden of the recession on workers and their families.
Union tactics were fairly shrewd. They didn’t just collide with employers who wanted to cut costs or governments who wanted to limit wage increases income policy.
Instead, they challenged the assumption of employers and politicians that inflation was mainly caused by wage increases (the wage-price spiral), rather than the result of corporate price increases, profit-seeking and passing on the cost of the oil shocks.
Read more: Inflation raises prices and lowers real wages – what needs to be done to support NZ’s low income households?
There were two tactics in particular that don’t seem to exist in Aotearoa today. The first focused on strikes against a particular employer. Once a breakthrough was achieved in one workplace, unions turned the gains into a broader industry, regional, or national standard. Targeted strikes were not as costly or risky as national or industry-wide strikes, where striking workers were supported through weekly union levies.
The second tactic involved broad, nationally coordinated mobilizations between unions. These include general strikes (citywide or national) and nationwide demonstrations. These solidarity actions were generally aimed at unsympathetic or irreconcilable governments seeking to curb wage increases.
When the Court of Arbitration a nil general wage bill in 1968 (meaning wages could not rise), the FOL staged a limited campaign of targeted strikes against certain employers despite inflation at about 5%. Wellington Trades Council held a one-day, general, citywide strike and a stormy one protest outside parliament.
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General strikes and export bans
Targeted interruptions were often very effective, especially in strategic industries where profits and production could be shut down quickly. Meat workers, for example banned all meat exports to counter the zero-wage scheme. This was the country’s largest export at the time, accounting for 40% of export earnings.
The export ban, together with many other stoppages, quickly brought results. Workers received a 5% raise nationwide just two months after the zero order was announced.
In 1979–1980, a union campaign successfully saw the repeal of the 1979 Pay Bill, imposed by Robert Muldoon’s authoritarian populist right-wing government and allowing the state to cut unilaterally negotiated wage increases between employers and unions.
Read more: Strikes: how rising household debt could slow union action this year
The campaign included a one-day national general strike in 1979. Some 340,000 to 400,000 workers (75-80% of the membership of the FOL) participated, according to reasonably reliable estimates. It was the most widely supported strike in local history, followed in 1980 by a successful three-month strike by paper mill workers at Kinleith which received significant national support.
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The last nail in the coffin for the Remuneration Act was the standard of living campaign organized in 1980 by the FOL and the Combined State Unions. Large protest marches were held across the country, including one that attracted up to 45,000 people for three hours. Citywide stop work action in Auckland.
There were too smaller strikes in the workplace aimed at achieving local wage settlements to keep up with inflation. These often resulted in piecework or bonus schemes, or allowances for clothing, boots, and working in dirty or hazardous conditions. All of them have helped tremendously with take-home pay.
Read more: Debate: Workers’ march kicks off again with historic strikes in France and the UK
Contested Strategies
These actions provoked strong reactions from employers, the state and from some parts of the community. Conservatives – like those who participated in the “Kiwi’s Care” march in 1981 – claimed strikers were greedy and disruptive, destroying the “national interest” and holding the country to ransom. But the law-and-order measures used to contain or suppress strikes usually only caused unrest.
A more effective response came in the form of economic restructuring and deindustrialization in 1980. Neoliberals argued that strikes squeezed profits and production and limited the “right of management to control the factory and office floor.” Employers and politicians used various tactics, such as factory closures, to successfully break unions and undermine workers’ power.
Although inflation in Aotearoa was tamed in the early 1990s, it came at the cost of dramatically increased class inequality.
Read more: Recent pay rises suggest collective bargaining is on the wane
Workers’ resistance to the cost-of-living crisis of the long 1970s is still a polarizing and contentious issue. That is probably the dominant view, expressed by both the neoliberal right and some on the moderate left workers caused their own downfall by hitting too much.
Some argued that unions are an “immature” conflict-based strategy which could never win, and that neoliberal restructuring was the inevitable response and outcome. Such a view tends to demonize the strike-prone 1970s as the “bad old days‘ when supposedly criminal ‘unions ran the country’.
But it is oversimplistic to blame workers for simply trying to keep their wages up with inflation after bargaining strategies failed. Those on the activist wing of unions would counter by arguing workers fought back en masse in the long 1970s to defend living standards. But they were simply defeated by more powerful global and local forces in the 1980s.
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The reduced collective
Global strikes may be back in vogue. At the beginning of 2023, there was already a “mega strike” in Germany, a “protect the right to strikeaction in the UK, and massive strikes against raising the retirement age in France. In Aotearoa, teachers’ unions have staged a rare coordinated strike. As the economic problems deepen, more is likely to happen.
Until now, however, these strikes against the cost-of-living crisis have not been as large or as widely supported as those of the long 1970s. In high-income countries, strike levels today are generally nowhere near the peaks of that period.
This, of course, is directly related to the astonishing decline in union membership since the 1970s. As a percentage of the total workforce, union membership in Aotearoa has fallen from a peak of 57.5% in 1979 to 17% in 2021. Strikes are therefore limited to a minority of the workforce, especially in the underfunded public sector.
No wonder, then, that most people today are coping with the skyrocketing costs by taking individual rather than collective action. It is also one of the many reasons why so many feel powerless to bring about deeper and lasting change.
