Political Exchange between Trade Unions and Governments in an Age of Austerity

Amidst the current debt crisis, Europe has witnessed a dramatic deterioration in government/union exchange, in contrast to the 1990s, when union-government concertation over welfare and labour market reform was prominent in the North and South.   This deterioration is most apparent in the sharp rise in general strikes aimed against austerity measures (i.e. economic policies aimed at either raising taxes or cutting discretionary public spending with the intention of immediately addressing fiscal deficits).  Traditionally, general strikes have been important collective action tools for unions to gain influence in social policy reforms, and have also served as a medium for unions to punish governments electorally for unilateral reform. However, general strikes directed at austerity are a more recent phenomenon; in the 1980s, 15 per cent of general strikes in the EU15 (plus Norway) were austerity related, but between 2008 and 2012, 72 per cent of strikes were directed at austerity measures. In this paper, we explore whether unions are less likely to secure concessions from governments, and whether governments incur greater vote share penalties after austerity-related general strikes. We expect austerity strikes to reveal different political exchanges between unions and governments than non-austerity related strikes for two reasons: 1) governments are under greater reform pressures and hence are more likely to act unilaterally, and 2) austerity measures are more likely to exacerbate unemployment which may increase the likelihood of future strikes, placing additional electoral penalties on incumbents.