On the one hand, the effects of recession have been severe, the poor suffering most, incomes falling consistently while profits rise. The recession caught the British working class while its state of organization was still poor, and the wave of popular mobilization over the Iraq war was receding.  It threw the organizations of the working class, above all the trade unions, into stunned disarray. The employers, being better positioned, got their act together quicker and used the opportunity to wage a successful series of class struggles aimed at cutting pay and conditions.

On the other hand, given the seriousness of the global crisis and the depth of the assault on living standards being steered through the state, the effects on workers have as yet not been as a catastrophic as one might have expected. A recent article for the International Socialism journal explores these effects on the labour market in detail. It points out a few significant factors:

1. Despite 1 million jobs being lost in the first years of the recession, most were recovered, and much of the impact of the crisis has been felt through a squeeze on wages rather than employment. And this squeeze on wages has been allowed to take place mostly passively, at least in the private sector, by allowing inflation to wipe out the cut the real value of wages rather than aggressively cutting them. Or, to look at it from another angle, underemployment rather than outright unemployment has been a crucial tactic of employers.  One reason for this might be that employers are reluctant to lose a wave of skilled workers, then have to start training up new recruits when growth resumes.  Another reason is that significant areas of industry are as yet unable to replace workers with automation, labour-saving devices and so on, and so prefer to keep workers on at reduced rates and lower hours.
2. Total employment has barely fallen, with most new unemployment accounted for by new entrants to the labour market — people forced to actively seek new or additional jobs as a result of declining living standards or reduced public services.  (There has been a 9 percent drop in university applications due to the trebling of tuition fees, and the abolition of the Education Maintenance Allowance which permitted working class students to go through A Levels necessary to get to university).  After the recovery in 2010, the UK economy has experienced two quarters of negative growth.  This is not a severe dip, but it could get a lot worse now that global capitalism is shitting BRICS.  Yet throughout that time, the unemployment rate has been falling, while total employment levels have increased to a new high.
3. Many of the worst labour market effects of the recession are being stored up for the long-term.  The job losses in the public sector have thus far been limited, even though the intention is to shed 1.3 million jobs.  Total public sector employment is presently just 50,000 below what it was in 2007, but deeper cuts are coming.  There is an underlying trend toward increasing the number of people in long-term unemployment, particularly young people: a generation is being systematically excluded from sustainable employment, acculturated to being an insecure rump, a reserve army if you will.  Part of the reason for this is that employers, rather than cutting jobs, are often simply ceasing to hire, while at the same time using high youth unemployment as a disciplinary weapon against those in employment.  As usual, precarity exerts its effects right up the chain.  Finally, one of the ways in which workers are being attacked is through the systematic attack on pensions, which stores up a crisis for future ranks of the elderly.

Some of the worst of austerity is scheduled to begin taking effect in 2013. This is when the benefit cuts contained in the Welfare Act come into effect. Some sickness and disability benefits have already been cut back, with some cruel effects. Over a thousand people have already died as a result of cuts to disability benefits after Atos, the contractor assigned to take people off welfare, deemed them fit for work.  450,000 people are expected to lose benefits as a result of the government’s reorganization of welfare into a single “universal benefit.” Hundreds of thousands of people will be driven from urban centres by cuts to housing benefits in a shameless example of social cleansing. If all of this happens as the public sector bleeds jobs, and the world economy slides again, then the social consequences will be immense.

Importantly, the devastation is already being proactively channelled in ways that recreate oppression on new bases, with the youth, women, ethnic minorities and the disabled particularly affected. New governmentalities are being elaborated, for example on the basis of containing “feral youths”; new technologies of power being refined; new race-making and gendering processes. But few are excluded from the assault: wages, pensions and conditions are being reduced for everyone. Proletarianization is being extended through formerly middle class roles. The present caution of the organised labour movement is no surety that a revolt of the oppressed, the precarious, the marginal, will not spark a wider rebellion.  This is why it is so important that the effects of the crisis and the capitalist offensive are staged, piece by piece, layer by layer, so that the totality of their effects are not experienced in a way that produces a broad enough basis for a successful rebellion. Of course, to say this is not to say that such staging will necessarily be successful. But it appears to be a real factor in the current government’s relative stability.