The legacy of Margaret Thatcher was fewer workplace rights, longer working hours and less productivity in the UK.
Yesterday’s Daily Mail celebrated the fruits of Thatcherism, with a headline that trumpeted:
Thatcher’s legacy: UK ‘is the only nation working harder than in the 1980s’
It joyously declared:
“Britain is the only country whose people work harder than they did in the 1980s, an international study has found. Margaret Thatcher’s workplace revolution has seen Britons working more hours per week than when she was in Number Ten.
“The former Tory prime minister’s success at cracking down on union restrictive practices and freeing the country’s entrepreneurial spirit means we work much harder than we used to. Meanwhile, across Europe, people now work fewer hours than they did in the 1980s.”
It quotes OECD data that shows that while working times have been falling in recent years across developed countries, they have been rising in the UK. In fact, as this 2009 EU data shows, British employees work longer hours than their counterparts in almost any other country (source : Eurofound):
All things being equal, this would make us (with Romania and Malta), the richest people in Europe. Unfortunately, our productivity lags far behind our main northern and western European neighours, according to this OECD data:
When did the UK fall behind? Well a big chunk of the ‘productivity gap’ fell into place in the 1980s, under Thatcher. Lets compare changes in productivity since 1979 between blessed economically liberated Britain and that union-infested tyranny of unreconstructed statism, France ( Again, sourced from the OECD):
As you can see, France sped ahead with productivity gains in the late 80s, just as Thatcher’s reforms kicked in. After the UK took a productivity hit in the mid-80s, the gap stabalised and finally closed under Labour. While Thatcherite reforms may not have been responsible for the loss of relative UK productivity, lack of them did not appear to hold back France. In fact, unsuprisingly, shorter working hours can be a spur to productivity. As an ETUC paper puts it::
“Protecting workers from excessive long working hours can be a driver for productivity. It prevents unproductive employers being ‘bailed out’ at the expense of workers’ time, instead forcing them to invest in a more productive organisation of the work place.”
So there you are – the Thatcher revolution: Longer hours, lower productivity: Something of which only the Daily Mail could be proud.
26 Responses to “Mail masks Thatcher’s true legacy: Unions busted, hours extended, productivity held back”
13eastie
Complete twaddle from start to finish.
Your second chart uses the USA as the datum. The av working week in the USA is 46 hours, but you didn’t include this in your first chart.
Why are only four minor European countries able to best the US with it’s longer week and far less holiday?
What happened to productivity in the decade prior to 1979?
And let’s combine that with a look at the contribution of your beloved unions:
________________________________________________________________
Annual Days Lost to Industrial Disputes per 1,000 workers:
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1970-1979: UK: 569 France: 286 USA: 507
1980-1989: UK: 332 France: 119 USA: 123
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( Source: http://bit.ly/mcrgdk )
The reduction in wasted man hours under Thatcher was enormous. To portray this as anything other than an achievement for productivity and output is disingenuous.
Your analysis is flawed completely by the fact that you make the phoney assumption that the only input required is measured in man-hours.
Businesses cannot exist without investors. And investors do not pay wages; they provide capital.
You forget conveniently that you need capital as well as labour to make businesses work.
And that businesses have overheads as well as operational costs.
Have you ever actually run a business?
Every day wasted by the unions, capital goes unused, R&D grinds to a halt, food spoils, textiles go out of fashion, overheads still accrue, productivity goes down, output goes down, investors get itchy feet. There are also secondary effects elsewhere in the economy. And the country as a whole loses.
To the eternal gratitude of our international rivals.
Fire up the Quattro!
Daniel Elton
@13eatie – Thanks for your comments. I’ll take two points 1) why can only five European countries equal or surpass the united states, and 2) that reduction in days lost for strikes should be set against productivity gains. 1) The main point of the article was to challenge the idea that ‘Because Thatcher meant we work longer hours, this was a good thing’ – and showing examples where people work shorter, more productive hours makes that point.
There is a seperate issue on U.S. versus European productivity, but what’s interesting is that plenty of economies with less ‘anglo-saxon’ models of capitalism get closer to the U.S. than we do, although to make a proper comparison you have to take account of differences in economic sectors.
2)The reduction of strikes was a good thing about the outcomes of the 1980s, but interestingly your data shows there was a greater proportionate reduction in France than the UK. I think there were other ways to go about it than Thatcher’s reforms. Although Thatcher was the punishment unions got for many years of irresponsibility, in particular it was commupance for their blocking of In Place Of Strife (http://en.wikipedia.org/wiki/In_Place_of_Strife), which would have led to a more continental, partnership model of industrial relations. I think if it had passed the economic history of the country may have been very different.
Daniel Swedin
Intressant om Thatchers "revolution": http://t.co/yCLT53K
Juan Voet
“@OtherTPA: .@DanielElton of @leftfootfwd on an incredibly stupid Daily Mail article on Thatcher's legacy http://t.co/etS9kBD” what did u x
13eastie
Daniel,
You do rather make my point for me.
The two countries you identify in your data (France; USA) as having fared better than the UK in the productivity stakes both curtailed destructive union disruption far more severely in the early 80’s than we did.
What Thatcher did was necessary for us to remain remotely competitive, and your data actually supports the argument that she didn’t do it enough.
Why did you choose “productivity” as a metric anyway? It is not something unions or their members are in the slightest bit interested in, and it does not correlate with living standards or quality of life. You could have chosen far more meaningful indices, but then they might not have to the conclusion at which you set out to arrive.
I’ll take Thatcher’s red Porsche 924 and Docklands loft over Callaghan’s power cuts and unburied dead any day of the working week (including weekends).