‘SHORTAGE' OF LABOUR IN THE COMMON MARKET by Pat Jordan
There are a number of factors which are threateni invi economic growth of the Common Market countries, Among iaoe iy shortage of labour which arises because of the essentially unplanned naire of the E.E.C. The rate of growth in total employment slowed down in these countries during 1963: being 1.2% in France, 0.8% in Belgium, 0.5% in Holland and 0.4% in both Western Germany and Italy. Except in the case of France these figures are considerably less than the natural growth in population, and they compare with economic growth rates many times as high.
Almost all the increase in the labour force is “accounted for by an influx of workers from agriculture or abroad. The number of workers in agriculture decline during 1963 in Italy by 272,000, in W. Germany, by 133,000, in #rance by 120,000, in Holland by 12,000, and “in Belgium by 8,000. In W. Germany foreign workers account for nearly 4% of the work force and firms are trying to recruit even more. However, this is not so easy as in the past, and some firms are recruiting in North Africa. Even Italian firms are recruting from abroad now. However, Government figures indicate that a growing number of foreign workers have begun to return home as conditions improve in their native countries.
Only in Italy has the decline in unemployment (mostly in the south) played much role in increasing the labour force, accounting for almost onethird of the rise in total employment in the last two years, But this source is tending to dry up as most of the remaing jobless are virtually unemployable because of where they live, age or lack of training. In France too, the process of drawing on the agricultural reserve is coming to an end and most of the repatriates from Algeria have been absorbed. In other countries there is virtual full employment.
France and Holland are now feeling the effects of the postwar baby boom; but other countries of the E.E.C. do not expect an increase in the working population to help much. The Common Market countries expect a rate of growth in their labour force to be less than half of that projected for the United States during the rest of the present decade.
There are many consequences of this shortage of labour: in some countries especially W. Germany, there is a tendency for stratification in the working class between foreign workers and native born workers. A recent UN survey pointed out that during 1963, Germans took 90% of the new jobs in the service section of the W. German economy but less than 30% of the new jobs in the commodity producing sector. In the Common Market countries is it to a great extent foreign workers who do the unskilled and unpleasant jobs. Another effect is to make it easier for unions to win wage increases and better conditions. The same survey gives the following increase in wage rates between 1958 and 1964 (1st quarter): 49% in France, 47% in Italy, and 40% W. Germany (to.beginning of 1964). This figures compare with 25% for Britain. Unit labour costs went up between 1959 end 1963: 28% in Italy, 21% in France, 20% in W. Germany, and 17% in the Netherlands. Again this compares with only 10% in Britain.
The severe shortage of labour will lead to counter measures to stop the workers from taking full advantage of their position. The authoritarian features of the E.E.C. will find expression in attempts to ematulate the labour movement. One of the 'ideological' weapons the employers will use will be the threat of foreign competition, perhaps in particular British competition. Hence we have an additional argument for trying to forge links with the European workers' movement at a very favourable juncture,