1890 Melbourne Unemployment Crisis

In the colonial era, unemployed workers relied on charities for income support, and the authorities subjected them to punitive, moralizing eligibility tests. For example, the Ladies’ Benevolent Society, at the time Australia’s largest and oldest charity, imposed a comprehensive program of surveillance on applicants for relief that was designed to weed out those considered “dirty and disreputable” or “thriftless,” along with the “clever pauper” who supposedly sought to make a living from handouts.

In this period, unemployed workers did not consider it possible or even desirable for the government to replace this punitive system with a decent, universal unemployment benefit. Instead, during times of high unemployment, the organized unemployed invariably demanded that the government create temporary public work programs — relief work — to get them back into employment. A failure to secure relief work would mean certain homelessness for the unemployed and their families.

When the unemployment crisis of 1890 hit Melbourne, it intensified the plight of unemployed workers, but also gave rise to one of the first unions to organize the jobless: the Unemployed Workers’ Union (UWU). Alongside other unemployed organizations such as the Anti-Unemployment League and the Labour Liberation League, UWU organized a flurry of mass meetings and demonstrations demanding “relief work” for the approximately ten thousand unemployed Melbournians.

Like the AUWU today, in 1890, UWU was seen as something of a novelty. Unlike the other unemployed organizations of the day, UWU was not an advocacy group that spoke on behalf of unemployed workers. Understanding that unemployed people are a part of the working class, UWU insisted on organizing them into a union.

It was in the direct interests of the union movement, argued the UWU, to unite with unemployed workers in a collective struggle against unemployment itself. Low unemployment — or better still, full employment — would mean less competition for work, strengthening the bargaining position of all workers.

Australia’s colonial history proved this argument correct. Labor scarcity in the Australian colonies between 1850 and 1890 placed the onus on employers to attract workers through high wages and good conditions. Not only were Australian workers some of the highest-paid in the world, but on average, they also worked fewer hours.

As mass unemployment took hold in Melbourne during the 1890s, the UWU argued that the eradication of unemployment should be core union business. “If every unemployed worker were provided by the state with employment at good wages,” argued unemployed leader Sam Rosa, “there would be none to force down wages by their demand for employment, and the wage earner would then become ‘master of the situation.’”

Going It Alone

In July 1890, the UWU demonstrated its strength at a three-hundred-strong open-air meeting in Melbourne’s La Trobe street. The demonstrators resolved to send a deputation to the Victorian Trades Hall Council “for the purpose of asking them to interest themselves in the unemployed movement.”

After finding Trades Hall less receptive than they’d hoped, a dejected meeting of unemployed workers three weeks later drew up the following resolution:

It is about time that that highly respectable circumlocution office [Trades Hall] ceased to platitudinize about the credit of the colony and the absence of thrift, and applied itself in a practical manner to the task of obtaining work for the unemployed.

Trades Hall finally reopened discussion on its position after receiving a donation of fifty guineas to aid unemployed unionists. During the ensuing debate, former Trades Hall president John Hancock — who in 1891 became the first Trades Hall–backed candidate to win election to the Victorian parliament — emphasized the need for “thrift” among the unemployed. Sam Rosa recalled that some members of the council were so “alarmed for their fetishes [for] orthodox trades unionism and protection” that they were in “favor of trying to prove there was no distress by sending the money back to the donor.”

Confronted with an uncooperative union movement, and lacking any industrial bargaining power of their own, the unemployed instead mounted a public campaign to pressure the Victorian government to take action. Impressive demonstrations of unemployed workers marched through Melbourne almost every day. Deputations of unemployed workers frequently made their way to parliament to address MPs. Over time, they shifted public opinion. Newspapers, the church, and even some conservative politicians began to speak favorably of the unemployed.

The movement reached its peak on July 20, 1890 when five thousand unemployed rallied on Queens Wharf in Melbourne to demand relief work — and to burn and decapitate an effigy of James Patterson, the minister of public works. Victorian premier Duncan Gillies agreed to provide relief work for around one thousand unemployed workers, and a few sympathetic employers recruited some unemployed. Ultimately, however, they ignored the demonstrators’ demands. Meanwhile, the unemployment crisis worsened.

War on the Streets

By early 1892, the unemployment crisis had claimed approximately one-third of all unionists in Melbourne. Victorian Trades Hall’s inactivity was becoming conspicuous.

In January, in a stunning rebuke, an estimated seven thousand unemployed workers — many of whom were former union members — surrounded Trades Hall “hungry for food and action.” The following month, Trades Hall set up the Unemployed Organizing Committee to distribute food, bed tickets, and clothing alongside the charities. Despite offering this significant concession, they still refused to give their wholehearted support to the nascent unemployed workers’ movement.

Increasingly desperate, having been denied the resources of organized labor, the out-of-work began to turn away from theatrical demonstrations and consultation and toward adventurism. In March 1892, following the repossession of unemployed workers’ property in lieu of rent, the unemployed formed the “Salvage Corps” to forcibly seize and return the confiscated items to members.

In May 1892, unemployed workers formed the “Victorian Regiment” and drew up plans to storm the Victorian parliament. This dream, however, was dashed by police intervention.

A Fractured Class

Facing police persecution, the unemployed renewed their efforts to enlist union support. By now, though, tensions between the unemployed workers’ movement and Trades Hall were at an all-time high. Former Trades Hall president and Labor candidate William Trenwith exemplified the organized labor movement’s disappointing response.

Trenwith was elected in April 1892 as the Labor member for the working-class, inner-city suburb of Richmond, largely on the strength of his campaign to assist the unemployed. Soon after taking office, he spectacularly turned on the organized unemployed movement, arguing that the “indecent excesses” of the Salvage Corps should give way instead to a campaign to elect the Labor Party. In effect, his stance kept the UWU and unemployed workers in the position of outsiders, while still demanding that they trust the labor movement to stand up for their interests.

UWU replied in June 1892 with a rowdy rally outside Trades Hall. One of its leaders, Passmore Edwards, accused the unions of “craft exclusiveness and indifference to the plight of the unemployed.” Carrying torches and banners, the demonstration marched to William Trenwith’s cottage on Coppin Street in Richmond to demand his resignation from parliament. Trades Hall secretary William Murphy quickly came to the defense of the embattled Trenwith, dismissing the unemployed agitators as “literary worms.”

By July, the situation had become even more dire. Although around one-half of all trade union members in Melbourne were unemployed, Victorian Trades Hall disbanded its Unemployed Organizing Committee. Months later, the Victorian Labor Party elected Trenwith as its leader.

This widening divide between the union movement and the unemployed led to tragic consequences for both sides. During the Great Strikes of 1891–94, employers were eager to hire the unemployed as strikebreakers. Abandoned by Trades Hall and half-starved with little prospect of relief, many unemployed workers gathered in droves, willing to accept whatever work was available. At the same time, years of mass unemployment had sapped the strength of the union movement, leaving them industrially weakened.

Sam Rosa pointed out that the only solution would have been to recognize the common interests between unemployed and employed workers:

Had the trades union leaders recognized this fact during the unemployment movement, they would not in the great Shipping Strike [of 1890] have had to fight a hard battle against nonunion labour. It is to be feared, however, that they do not possess the economic knowledge which every labour leader should have.

The Dark Side of Laborism

The Great Strikes ended in a devastating defeat for the union movement which precipitated a historic transformation in Australian unionism, away from small, parochial, craft-based unions and toward large-scale industrial unionism. To the dismay of Sam Rosa and the unemployed movement, however, the unions did not change their attitude toward unemployed workers.

Shocked by the viciousness of the police during the strikes, the unions instead resolved to deny employers unhindered access to the state and its repressive machinery. The organized labor movement, for the first time, cohered around a widely accepted aim: forming a Labor party and campaigning to elect it to government.

This laborist ideology argued that unions should use their rising political influence to address the immediate economic concerns of employed workers — specifically, by improving wages and conditions. They only paid fleeting attention, however, to social objectives that fell outside the direct scope of wage relations in the workplace, such as social security or unemployment policy.

The result was a cruel paradox. Following the introduction of compulsory industrial arbitration and protectionism, Australia’s labor market became one of the most regulated in the world. At the same time, social support for those locked out of work was largely nonexistent.

While European Social Democratic parties pushed for universal welfare, the Australian labor movement instead sought to build a “wage earners’ welfare state.” As social security academic Terry Carney has argued, Australian unions maintained this commitment into the twentieth century, prioritizing “work-based forms of welfare.”

Meanwhile, unemployed workers found themselves on their own. Indeed, the union movement routinely regarded organized unemployed workers as a threat, going so far as to brand them as “obstacles to the progress of the working-class movement” during the Great Depression of the thirties. Unions of unemployed workers, union leaders argued, were not unions at all.

Sadly, this tradition is still with us. William Trenwith’s late-Victorian insistence that unemployed workers should avoid “indecent excesses” and support the official, organized labor movement remains the de facto position of Australian unions. Just as it did in the 1890s, this prejudice harms all workers by dividing those without jobs from the rest of the class.