The fragmentation o the labour market

...Since the war we have, of course, lived through changes which were retarded by various conservative forces, such as managerial inertia and trade union immunities, but not ultimately denied. Our heavy industries have been in decline for a very long time (in Glasgow since before the First World War).

More recently, the drive for profitability in newly competitive arenas which have been privatised or liberalised, together with increased exposure to international competition and the introduction of new technologies, has been squeezing labour out of the system.

This process was masked by the boom in the service industries in the eighties which, as it turned out, was insecurely based on a credit binge. Had the IRA succeeded in blowing up the tower at Canary Wharf, there would have been gratitude in surprising places.

The theory was that market forces would put the released human resources to better use. Suddenly this looks a highly unsafe assumption. The stream of extruded labour has become a flood. From all parts of the political spectrum people are expressing alarm. Daily Telegraph leader-writers are converts to interventionism.

The miners find the public behind them as they fight for their jobs, even though the policies that have removed the viability of their pits have been carefully crafted by government over a long period. Now the railwaymen face a brutal contraction, partly as a result of the recession, partly as a result of inadequate capital investment. And even banking is an uncertain place as competition and technology drive people out of what were not so long ago jobs for life.

What seems clear is that our economy is no longer going to sustain or create large-scale employers of labour, and that the patterns of employment are going to be much more fragmented. The chief executive of a local enterprise company last week told me he had just been to visit an exceptionally successful Scottish company. Ruefully he added that it employed 10 people.

We have barely begun to glimpse the social and political consequences of this change. It is not that technology has deskilled our workplace. It has, as William Knox, lecturer in Scottish history at St Andrews University, points out in a new essay, created a demand for new skills which are altering the balance of power in industry.

Traditional craft skills have gradually disappeared over the course of the twentieth century and with them ”the existence of a culture and system of values to which they gave rise”.

Mr Knox continues: ”The independent craftsman symbolised in the ownership of tools, the extensive system of rituals and ceremonies which served to emphasise his status in the workplace and underpin the values of craft pride and solidarity, disappeared with the arrival of the stopwatch, quality control, planning offices and modern technology. In his place emerged the semi-skilled assembly worker and the technician, more specialised and subject to greater managerial discipline.”

That, as much as legislation, destroyed the old craft unions. Their tragedy was made worse by their own struggle to retain power. Mr Knox gives a brief but fascinating insight into the decline of Clyde shipbuilding where craft hegemony conspired with proprietorial and management myopia.

The industry’s vulnerability to shifts in world demand made Scottish employers reluctant to invest. Instead of developing standardised products they continued to rely on skill-intensive methods of production.

They kept on building unique products. As late as the 1970s, except in yards building warships, ”control of quality and dimensional accuracy is provided by the workplace”. A glorious tradition of independent craftsmanship carried the seeds of its own destruction; and the QE2 was infamously launched on a sea of industrial indiscipline and management incompetence. When finally it sailed from the Tail of the Bank it was among the last of its kind.

The gloomy ruminations of a gloomy week culminated in a gloomy conversation with a university teacher of electrical engineering. His department was having great difficulty in attracting Scottish students of quality, he said. The intake of students from Singapore was of superior calibre. The Scottish students had particular difficulty with mathematics and he reckoned something had gone wrong in the schools, although couldn’t put his finger on it.

What saddened him was that our culture had turned its back on a central part of its own tradition. His discipline no longer interested the best Scottish candidates. But it sure interested our competitors.