Strikes sweep Britain as soaring inflation savages living standards
To heat or to eat? Financial journalist explores decision facing some families this winterReplayMore Videos ... (16 Videos)To heat or to eat? Financial journalist explores decision facing some families this winter'Both a warning and a threat': Economics professor decodes Fed chair's commentsFed chair lays out the 'unfortunate costs of reducing inflation'Biden's student loan forgiveness plan: Who it helps, who it doesn'tMiddle class Black Americans react to economy under BidenEngineer says she 'quiet quit' her job. Hear what that meansFed official on recession talk: When we look at the data, I feel relievedInflation is cooling but prices are still painfully high'It didn't get worse': Romans breaks down key inflation dataOnline shopping prices are starting to ease. Here's why that's significantHere's how the Inflation Reduction Act could affect you'Jaw-dropping number:' Ex Obama economic adviser on the jobs reportJuly jobs report doubles expectationsWhat is a recession?'I don't want to go bankrupt': High inflation leaves little room for unexpected costsFood bank demand skyrockets as cash-strapped Americans seek help over inflationLondon (CNN Business)Workers in the United Kingdom have had enough of falling living standards.
Rail workers, journalists, lawyers, and postal workers have gone on strike in recent weeks to demand higher pay as inflation soars to its highest level in decades.At least 155,000 workers are currently on strike, including staff at the country's postal service, and engineers and call center workers for telecom provider BT (BTGOF). Two rail unions on Wednesday announced further strike action by 14,000 of their members later this month. More strikes could be on the way this fall, threatening unprecedented disruption across a range of industries. Teachers, doctors and nurses are set to vote on strike action in the coming weeks. Unions could even coordinate their walkouts. Unite and Unison — the country's biggest unions with 2.7 million members in total — are calling for others to join them in synchronized action.It is one of the most significant waves of industrial unrest the United Kingdom has seen since the "winter of discontent" in the late 1970s when rampant inflation pushed workers to stage mass walkouts. About 7.9 million working days were lost between November 1978 and February 1979, according to the Office for National Statistics. About 40,000 cleaners, signalers, maintenance workers and station staff walked off the job in June in Britain's biggest and most disruptive railway strike for 30 years. Read MoreSoaring prices and years of stagnant wages are the backdrop to this year's disputes. Consumer price inflation hit a 40-year high of 10.1% in July. Forecasters at Citigroup said last week that inflation could shoot past 18% at the start of next year, and Goldman Sachs thinks it could even hit 22% if gas prices don't fall soon. Workers are already feeling the strain. Average real wages, which account for inflation, fell by 3% between April and June, compared with the same period last year. That was the biggest hit to spending power in more than 20 years. Real wages barely increased in the decade to 2020.And average household energy bills — which have already risen 54% this year — are set to increase by another 80% to £3,549 ($4,124) in October. According to estimates by Auxilione, a research firm, average bills could hit £7,700 ($8,949) next April — equivalent to a £642 ($746) monthly bill. Workers are mobilizing in response. 'Demoralizing' The United Kingdom has "never seen [this] level of disruption across all sectors," Chiara Benassi, an associate professor in comparative employment relations at King's College London, told CNN Business. In recent months, the cost-of-living crisis has acted as a "trigger" for widespread grievances that have been building up over a long period of time, she said. "These strikes affect not only [what] we would say [are] manual occupations or low-skilled jobs that more evidently would struggle with the cost-of-living crisis, but also highly-skilled jobs like junior doctors, British Telecom engineers, barristers, academics, teachers," Benassi said. BT workers on strike over pay on August 30 in London, England.Deepsha Agrawal, a junior doctor at Oxford University Hospital, told CNN Business that her colleagues are pushing for a bigger pay increase than the 2% the government agreed back in 2019. "It's quite demoralizing, because the current inflation rate is expected to go very high next year," she said. Her union, the British Medical Association, will soon ballot its members over whether to strike. Agrawal believes that they will. Many of her colleagues feel they cannot afford to buy houses or have children. "[Junior doctors] are as hardworking and as educated as other professionals. We are struggling and we are paying a price out of our pocket to do the work that we do," she said. "With what happened during Covid, we should be rewarded for what we did, not punished for what we do every day," Agrawal added. Fewer union membersThe current wave of industrial action cannot easily be compared to the 1970s and 1980s — if only because the government stopped tracking numbers of striking workers, and working days lost, during the Covid-19 pandemic. It recently started collecting data again, and will provide an update this month. Richard Hyman, a professor of industrial relations at the London School of Economics, told CNN Business that this years' strikes would pale in comparison to those of earlier decades simply because union membership has fallen so dramatically. "Around about 1980, more than half the workforce was in a trade union. Today it's less than a quarter, so there's been a big decline," Hyman said.Strikes used to be concentrated in sectors which have "more or less disappeared" like coal mining and steel, Hyman added. Now, union membership is more heavily skewed towards the public sector, or big utility companies that used to be owned by the government. "There's been the rise in precarious work, so that a growing proportion of workers simply don't have a proper job any more so are not in a position to go on strike," Hyman added. Benassi said that during the 1980s, when UK manufacturing industry was shrinking rapidly, strikes were often about the survival of key sectors.Between 1984 and 1985, thousands of coal miners went on strike after Margaret Thatcher's Conservative government threatened to close many of the country's coal pits. "[Today] it's a bit different, because we are talking only about pay. Of course, the disputes at the time were also about pay but it was also about, for example, not closing down the mines," she said. More restrictions coming?This year's strike wave is significant, though, for the breadth of industries affected and because of the hoops UK workers have to jump through to down tools legally. "Striking in the UK is very difficult. It's way more difficult than anywhere in western Europe, especially after the Trade Union Bill in 2016," she said. The legislation, which came into force in 2017, made it much harder for unions to call a strike by requiring at least 50% of members to take part in the ballot, and at least 40% of the votes cast to be in favor of strike action. The law also increased the period of notice unions must give employers of their intention to strike from one week to two. In comparison, Benassi said that neither a ballot nor a notice period are required in Germany. Liz Truss, UK foreign secretary and favorite to succeed Boris Johnson as prime minister next week, has said she would bring in even tougher limits on unions' powers to call a strike. Waste overflows from bins during a strike by workers in Edinburgh, Scotland, on August 27.She has proposed raising the support threshold for strike action from 40% to 50% of votes cast, and extend the notice period to a month."I will take a tough line on trade union action," Truss told Sky News in July. Liz Truss' leadership campaign declined to comment when contacted by CNN Business. "There's quite an adversarial campaign from the side of the government to say well we'll send agency workers to replace the workers on strike, or they should go back to work immediately, or there has already been a pay rise," Manuela Galetto, associate professor of employment relations at the University of Warwick's Business School, told CNN Business.Despite the obstacles, workers may feel more emboldened to strike at the moment, given the tight labor market, she said. UK unemployment was 3.8% between April and June this year, ONS data shows. That's its lowest level in more than 50 years. There was also one unemployed person for every job vacancy — a record low. "It means that many workers are in work and they are in a good position to ask for [a pay] increase. They cannot be easily replaced [at a macro level]," Galetto said. Click Here To Get Funded!