Analysis of Industrial Relations Law Research Paper

Analysis of Industrial Relations Law - Research Paper Example Her self-professed aim was to shift the balance of power in industry and restore management prerogative in the workplace. The extent to which her policies succeeded in transforming the character of production politics and industrial performance has been the subject of intense debate. One line of argument suggests that, in contrast to the Donovan reform strategy which failed to deliver significant performance gains in the 1970s, Thatcher's policies appear to have done the trick (Metcalf 1989). The potent combination of rising unemployment, tougher labor laws, privatization, and deregulation allegedly gave birth to 'new' industrial relations practices in the workplace and a corresponding improvement in productivity and competitiveness. The analysis which follows challenges this perspective. It argues that the system of industrial relations and employment regulation which came to dominate key sectors of the economy after 1945 was not conducive to industrial modernization: not, it should be stressed, for the reasons cited by proponents of the conventional wisdom, but because the trade unions and other regulatory mechanisms were too weak to force firms to abandon progressively outmoded business practices. The presence of a relatively cheap, disposable, and malleable labor force inhibited the emergence of high wage, high productivity growth strategies and helped entrench a relatively low wage, low productivity industrial system from which it is now proving difficult to escape. There is also a second sense, which concerns the academic study of industrial relations and its relationship to economics. Much more so than in other European countries and the United States, there has been a sharp demarcation line in Britain between the study of the institutions of job regulation and the study of their economic consequences. This may seem an academic point, but it is not without consequence, for this unwelcome division of academic labor has served to impede theoretical innovation and entrench established ideas, particularly the conventional wisdom. It is relatively uncontroversial to note that in the three decades after 1945 British industrial performance exhibited significant deficiencies as compared to other leading capitalist economies. Relevant performance measures in this context include output and productivity growth rates, the balance of trade, and investment in technology, plant, and people. The evidence of British underperformance is most striking in the case of manufacturing. Comparisons of output and productivity movements across time, sectors, and countries are fraught with measurement problems (Nolan and O'Donnell 1995). Nevertheless, the evidence--whatever its shortcomings-reveals a substantial and enduring shortfall between Britain's record and that of other leading economies. Fig. 5.1 charts the movements in manufacturing output and exposes a significant and growing gap between Britain and the other countries. For the period shown, domestic output has remained more or less stagnant.  Ã‚