Whatever Happened to "Full Employment"? (1974)

From the December 1974 issue of the Socialist Standard

In The "Queen's Speech” on 29th October Mr. Wilson included a pledge about unemployment. "My government”, it read, "in view of the gravity of the economic situation, will as its most urgent task seek the fulfilment of the social contract as an essential element in its strategy for curbing inflation, reducing the balance of payments deficit, encouraging industrial investment, maintaining employment, particularly in the older industrial areas, and promoting economic and social justice.”

Maybe Labour Party supporters are reassured by this mumbo-jumbo, but they ought to examine the small print very carefully. If they do they will notice how the form of the pledge about dealing with unemployment has been discreetly watered down. Now it is part of a “strategy”, along with other aims, all of them dependent on the nebulous "social contract”, and the word “full” has been dropped. And all of it stems from the grave economic situation — their euphemistic way of describing a normal crisis of capitalism, aggravated by the inflation that Tory and Labour governments alike have brought about and are still promoting.

When the first post-war Labour government came into office in 1945, buoyed up with the fatuous belief that they had mastered capitalism and abolished crises for ever, their committal to deal with unemployment was in very different words. Then it was "Jobs for All” and "Full Employment”. In the early post-war years (due among other things to making good wartime destruction) unemployment was exceptionally low. In several years average unemployment then was under 300,000, about 1.2 per cent., and of course the Labour and Tory governments claimed credit for it.

Since the mid-fifties unemployment has been moving to higher levels, but as late as 1966 in the Wilson Labour Government John Diamond MP, Chief Secretary to the Treasury, boasted that they had got unemployment down from 1.6 per cent, to 1.2 per cent, and “that is how we propose to continue doing it" (Hansard, 6th March 1966). Capitalism, however, was not listening to Mr. Diamond and by the time they went out of office in June 1970 unemployment had gone up by about a quarter of a million to 579,000 (2.5 per cent.). In October 1974 it was 643,000 (2.8 per cent.), and with unemployment rising in most parts of the world the Government’s advisers are fearful that next year it may pass the million mark, as it did in 1972.

But if the politicians cannot prevent capitalism from following its normal course, with periodical higher levels of unemployment, their thoughts are turning hopefully to disguising it by “keeping the unemployed on the pay-roll”, paying subsidies to firms in difficulties instead of paying the money to the unemployed. A correspondent of the Sunday Telegraph (22nd September) estimated that subsidies to such companies were running at £2 million a week and that the jobs of 100,000 workers were involved. There is nothing the Labour Party will not try to do with capitalism — except abolish it.

Edgar Hardcastle