Trade unions and the social contract: British and Swedish style

The problem facing the British economy is to curb inflation, reduce the deficit on the balance of payments, now running at £4,000 million a year, raise company profits to improve new capital investment, improve efficiency and productivity and to contain wage demands. The competitive power of British exports in the world will depend to a large extent on labour costs and managerial competence. Labour costs largely depend on the attitudes and actions of the trade unions, and in full employment their power is considerable. It can have far reaching social and economic effects. Their failure in the past two decades to readjust their philosophy, their organisations and institutional arrangements, created in times of mass unemployment, to conditions of full employment is partly the reason for the present state of industrial relations: backward, inward looking and divisive.