One of the defining stories of the British economy over the past few decades is the decline in trade union membership. The UK has experienced one of the sharpest falls in Europe, from a high of 49.9% in 1981 to a record low of the low 20s today. But while this captures the British picture, it’s not the whole story – look more closely at the constituent parts of the UK and you’ll see that in Wales, we’re doing things differently.
It’s well known that Wales has strong bonds with the trade union movement, with historically high union membership dating back to the times of heavy industry. Such bonds emerged from the heavily unionised mining industry that produced Welsh political heavyweights such as Aneurin Bevan. To this day, unions remain players in the political landscape to a far greater extent than in much of the rest of the UK, and are crucial to Welsh national and civic identity.
That’s not to say all is well for Welsh unions. Young workers are not joining to the same extent as those of previous generations, there’s an underrepresentation among private sector employees, and the rise of precarious and gig economy workers poses significant challenges. We have also seen strikes across the public sector, with teachers and ambulance workers declining pay offers earlier in the year.
Yet against this backdrop, the Welsh government has been quietly trying to pursue a new model of industrial relations. Emulating the “high-road” models of the Nordic countries, it is seeking to create an economy that has strong partnerships between government, trade unions and employers. Wales has a trade union membership rate of about 35%, compared to just over 20% in England. While this is still well below international top performers such as Iceland (over 90%), Denmark (67%) and Sweden (over 65%), this divergence could lead to two very different pictures of employee relations between England and Wales.
This is not the only way that things are happening differently here. The pioneering Well-being of Future Generations Act is already requiring public bodies (and encouraging others) to take a long-term view on the significant challenges and opportunities that Wales will face over the coming decades. From delivering the transition to net zero, to ensuring the health service is fit for purpose, the new commissioner has his work cut out in attempting to shape these issues. The creation of the Curriculum for Wales, which teaches young people about the country’s unique history and place in the world, foregrounds the idea of shaping responsible and capable citizens for the future. It has even included a pilot programme through which children learn about unions and the world of work.
The Welsh government’s three-year cooperation agreement with Plaid Cymru also points to the potential for more collaborative working in some policy areas, something that citizens may well welcome. And the devolved government’s new social partnership and public procurement bill – still going through the Senedd – would give a statutory basis to a forum of ministers, unions and employer associations in the public sector.
So, is there anything Keir Starmer could learn from Welsh Labour’s performance in government across the border? Well, for a start, the Welsh government has grasped that any serious project of economic renewal needs trade unions at the table. Without a more equal distribution of capital to labour, the UK will continue to fall behind comparable countries such as France, Germany and Sweden when it comes to living standards, productivity and economic equality. The lesson from Nordic countries that Wales is trying to apply is that in order to achieve growth that is meaningfully shared by low- to middle-income workers, a social partnership approach supported by strong trade unions and collective bargaining is the way forward.
But is it enough? We don’t think so. Our report, Beyond Social Partnership, looks at how Wales can go further still to achieve a more just economic settlement.
We are calling for a union renewal fund, to be financed by the Welsh government, to enable unions to reach people who aren’t joining in sufficient numbers, such as young workers, private sector workers and those in the gig economy. We also want to see trade union density and collective bargaining coverage formally included in Wales’ national milestones, which are underpinned by the Well-being of Future Generations Act. And the devolution of powers to regulate trade unions could be a first step in a wider move to devolve powers pertaining to employment and industrial relations. We would want a potential Labour government in Westminster to commit to this, and to repealing restrictive trade union legislation that is in effect across the UK.
Wales is facing many challenges: a stagnating economy, a health service failing to deliver, and the threat of a wider rollback of devolution. Yet the political atmosphere feels more optimistic, with a potential UK Labour government seen as a harbinger for change. Whatever the future in Westminster brings, Wales is setting itself on a distinct pathway, one where fair work, wellbeing and forging positive relationships with trade unions are at the forefront. The question is: can the rest of the UK keep up?
Auriol Miller is director of the Institute of Welsh Affairs, an independent thinktank. The IWA’s economic policy work is supported by the Friends Provident Foundation charity
