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Productivity and Labour: four paradoxes and their implications for policy

John Buchanan1

I first met Russell Lansbury when he was academic adviser on the conduct of the first Australian Workplace Industrial Relations Survey (hereafter AWIRS, for details see Callus et al 1991). At that the time, labour’s contribution to productivity was a matter of acute public and policy concern. The Business Council of Australia had recently released its report Enterprise Based Bargaining: A Better Way of Working (BCA 1989). Although it is little discussed today, this report had a huge impact on industrial relations policy. It was based, in part, on two large-scale surveys of BCA members: one of CEOs and one of their workplace managers. A core finding of this publication was that if policy makers implemented the agenda of greater marketisation of relations at work there would be 25 per cent boost in labour productivity (BCA 1989, p. 34).

A short while after the release of the BCA report, we published the findings of AWIRS – a study based on a rigorously constructed stratified random sample of workplaces and many, many months devoted to designing a robust survey instrument. Unsurprisingly, many of the AWIRS findings contradicted those of the BCA. Russell spoke as the academic commentator at the Sydney ‘roadshow’ held to disseminate the AWIRS findings to the interested public. He noted a number of these quite major inconsistencies in the AWIRS statistics and the BCA assertions which, by that stage, had become conventional wisdom in many industrial relations policy circles. But he made an even more telling criticism of the BCA study. He argued that a close reading of it revealed there were major differences between what the CEOs asserted were problems (such as multi-unionism and multi-award coverage at workplace level) and what the workplace managers had reported as problems. He noted that the authors of the report had chosen to highlight the CEO’s observations because they wereallegedly more ‘objective’, as they were not caught up in the day- to-day experience of industrial relations. Russell made the simple – but withering – observation that this was a BCA reworking of the old Marxist theory of ‘false consciousness’. Whereas Leninists used this it to justify the privileged insights of an elite party, the BCA was using it to justify the insights of the economic elite. At the time the Berlin Wall had just fallen and Russell noted that such simple-minded theories of ideology had proved unhelpful for the then Eastern Bloc countries – and it was probably best to avoid reliance on such simple minded theories here as well.

The problem of unhelpful policy narratives in the realm of economic and working life continues today. In the late 1980s and early 1990s ‘the problem’ was the ‘industrial relations system’ and its associated ‘IR mindset’. Today we purportedly face a more widespread ‘productivity challenge’ . The essential features of the currently dominant narrative can be summarised as follows.

1. If factor inputs (especially capital and labour) are more ‘free’ to be deployed on the basis of market signals, an optimal allocation of resources will result and productivity will be boosted.

1 This paper draws on research I have undertaken over the last decade with colleagues at the Workplace Research Centre (previously known as ACIRRT) at the University of Sydney Business School and elsewhere, especially Karel Williams, Julie Froud and Sukhdev Johal. Where-ever possible I have cited relevant publications summarising our findings. Assistance with retreiving and processing the data on the dairy farming sector was provided by Stephen Coats, Astrid Dahl and Serena Yu. Helpful editorial advice was provided by Keith Hancock. All errors of fact and judgement are my own.

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2. This is best achieved if market players are given greater ‘user choice’ in how they meet their needs, based on freely determined relative prices. Inference from non-market forces will ‘distort’ efficiency and thereby limit potential output.

3. Since the 1980s nearly all advanced countries have liberalised their markets, especially capital markets. The subsequent gains to capital markets have provided clear evidence of what liberalisation can deliver in terms of innovation.

4. Those that have embraced this policy stance have prospered most. This is most evident on best indicator of productivity – total (or multi-)factor productivity. This captures the efficiency of how all factors interact – not just the benefits arising from one factor considered in isolation.

5. This reasoning can be applied to the economically passive population (for example, welfare recipients) as well as those in or actively looking for paid work. The allocation of income support as a right of citizenship nurtures welfare dependence. It is time that rights to income support were based on the obligation to labour so that we can ‘make welfare pay’.

The productivity of an economy is important for the quality of life in a society. If more can be produced with the same or fewer inputs, the material basis for improved living standards is provided. Recent data on trends in Australian multi-factor productivity provide prima facie evidence that we do have a problem. Indeed, in the last up-swing of the trade cycle this measure of labour productivity actually declined. Table 1 summaries the key statistics.

Table 1: Multi-factor Productivity (MFP) Growth in Australia

Cycle MFP Growth Rate (%)

1964/65 – 1968/691968/69 – 1973/741973/74 – 1981/821981/82 – 1984/851984/85 – 1988/891988/89 – 1993/941993/94 – 1998/99

1998/99 – 2003/20042003/2004 – 2007/08

1.31.61.10.81.02.31.11.1-0.3

Sources: Quiggin 2006: 20, ABS 2010. See also House of Representatives Standing Committee on Economics (2010) and Farmakis- Gamboni and Yuen 2011Note: These estimates are based on ‘market sector’ industries, that is Australia and NewZealand Standard Industrial Classification 2006 (or equivalent) divisions A to K and R.

Unfortunately the currently dominant ‘productivity narrative’ is part of the problem and not ‘the solution’. This paper draws on the findings of recent applied research undertaken at the Workplace

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Research Centre to reveal how inaccurate, misleading and unhelpful the analysis and prescriptions of this narrative are. It does this by identifying four facts about productivity and labour today. These are:

- Strong (weak) productivity performance has recently been associated with subsequently weak (strong) economic performance

- Preoccupation with optimal deployment of labour in the short run retards economic development in the medium to longer term

- It is often difficult, if not impossible, to consider output and labour input as independent variables

- The current productivity slowdown is occurring at a time of unprecedented abundance.

The paper concludes that understanding the connections between inputs and outputs and the context in which they are embedded is the key to understanding what determines productivity and identifying ways to improve it. These are issues that have been central to the research of Russell Lansbury and the scholarly traditions from which he sprang and to which he has contributed so much.

Paradox 1: Data on strong (weak) productivity performance has recently been associated with subsequently weak (strong) economic performance

1 (a) Strong productivity performance in recent times is an extremely poor predictor of economic performance today.

Since the 1980s there has been a policy mantra: the Regean and Thatcher miracles have transformed once underperforming economies into models for other countries to emulate. ‘Rolling back the frontiers of the state’ by ‘deregulation’, tax cuts for high income earners and allegedly reducing the size of government were held to be universal prescriptions for economic renewal. These ‘lessons’ were embraced by countries such as Ireland with results which, in turn, fuelled the call for more of the same. As the then UK shadow Chancellor, George Osborne, noted of Ireland in 2006:

… what has caused this Irish miracle, and how can we in Britain emulate it? … capital will go wherever investment is most attractive. Ireland’s business tax rates are only 12.5 per cent, while Britain’s are becoming the highest in the developed world.

…World-class education, high rates of innovation and an attractive climate for investment: these are all elements that have helped to raise productivity in Ireland.

… The new global economy poses real long term challenges to Britain, but also real opportunities for us to prosper and succeed. In Ireland they understand this. They have freed their markets, developed the skills of this workforce, encouraged enterprise and innovation and created a dynamic economy. They have much to teach us, if only we are willing to learn. (Osborne 2006)

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The situation since 2008 has been dramatically different. Ireland is now one of the worst performing economies in the OECD – with the UK and the US not too far behind. Ironically, the country with the strongest growth in output per hour worked in the seven years preceding the recent upheavals – Greece – is now taking the European economies to the brink of collapse. The essential developments in the last decade are summarised in Table 2 below.

Table 2: Labour Productivity 2000 – 2007 and Unemployment 2006 and 2011.

Country Indicators of Productivity 2000 - 2007 UnemploymentGDP per hour

worked, 2007, USA = 100

Annual productivity growth rate 2000 –

2007(GDP per hour worked)

2007(Year

average)

2011(April)

GreeceIrelandUSUK

JapanAustraliaNorwayGermany Canada

6397

100101

7388

1429986

2.82.72.11.9

2.01.61.41.40.9

8.34.64.65.3

3.94.42.68.46.0

14.114.79.07.6

4.74.93.36.17.6

Sources:

Data on productivity from Economic Policy Institute analysis of Conference Board and Groningen Growth and Development

data. Sources: Mishel, Bernstein and Hierholz (2009) page 361 and Economic Policy Institute 2011.

Data on unemployment are from OECD Harmonised Unemployment rates. Details for 2007 from OECD 2009 and details for 2011 from OECD 2011. Note that the data for Greece are for December 2010, for UK February 2011, Norway March 2011. May data for USA: 9.1 per cent and Canada 7.4 per cent.

The irony continues when we note that countries commonly criticised for inflexibility performed far better during and after the recent economic turbulence. Indeed, German unemployment rates have actually fallen. This is in stark contrast to former ‘stellar economies’ which embraced the dominant productivity narrative. Unemployment rates have virtually doubled in Greece and the USA and nearly trebled in Ireland. Clearly, past trends are not necessarily a good guide to the sustainability of a productivity growth path.

Detailed analyses by researchers at the Workplace Research Centre have established a similar point about Australia’s recent labour market performance (eg ACIRRT 1999, Watson et al 2003). While outwardly indicators look good for the Australian labour market, closer analysis reveals that the dynamics of fragmentation – especially rising inequality in wages, hours and forms of employment –

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is limiting the longer term capacity of the economy to grow and for all citizens to share in the benefits of growth.

1 (b) : Poor total factor productivity performance is not necessarily indicative of inefficiency.

While ‘good trends’ are not necessarily a predictor of future success, ‘bad trends’ are not necessarily a sign of failure. An excellent example of this is provided by recent developments in the Australian dairy farming industry. Important data on this matter are kept by Dairy Australia (Walker et al 2007, Coats et al 2009, Coats 2011, Weichert 2011). Between 1979/80 and 2009/10 the number of dairy farms dropped from 21,994 to 7,511 (Dairy Australia 2010) while the dairy herd remained roughly the same: approximately 18,000 cows at the beginning of the period and 16,000 at the end. Not surprisingly litres of milk per cow rose 50 percent over this period: from 2,848 to 5,445 litres per annum (Dairy Australia 2010). Summary information usually relied on to assess the economic health of a sector, as provided in Figure 1, does not reveal any of these improvements.

Figure 1: Trends in Inputs, Outputs and Total Factor Productivity: Australian Dairy Industry 1988-89 to 2008-09

Source: Coats 2011 and time series information provided by the Australian Bureau of Agricultural and Resource Economics and Sciences.

If we were to use this figure alone we would conclude that the sector has become less, not more, efficient in its use of resources. But these data do not capture anything like the full reality of the recent performance of Australia’s dairy farms. In particular, farmers have had to grapple with a sustained drought and rising input costs. These developments have resulted in increasingly volatile levels of farm income as is evident in Figure 2.

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Figure 2: Real Farm Cash Income, Australian Dairy Farming Income 1991/92 – 2010/11 (‘000)

Source: Coats et al 2009, Coats 2011 and Thompson et al 2011Note: Figures expressed in 2010/2011 terms. Estimate for 2010/11 is provisional.

Dairy farmers have very creatively responded to the problems of costs and the vagaries of demand by building adaptive capacity to meet unanticipated events. Initiatives have included investing more in improved farm management and feeding systems and innovations introduced to adapt to changed circumstances that have resulted in major reduction in the incidence of lameness, mastitis and pasture damage (Coats 2011). This has ensured industry renewal and rejuvenation when it’s survival has been seriously under threat. Indeed, far from standing still and slowly ‘declining’ in the face of increasingly difficult circumstances, the sector has actively planned for innovative restructuring and workforce development to manage the increasing risks and uncertainties of production (Cole 2004). This case highlights the fact that preoccupation with ostensibly self-evident indicators of ‘optimal’ management of factor inputs can result in neglecting the importance of the management of risks. Sometimes building redundant and adaptive capacity is critical for sustainable, not just short- run, efficiency in production.

Implication for policy of paradox 1. In recent years concern with Australia’s producitivity performance has become a bipartisan pre-occupation, fed in large part by Federal Treasury’s narrative about the need for better management of it’s three ‘Ps’ agenda: productivity, participation and population. Productivity as a measure of economic performance must be used with extreme care. It is best regarded as a useful accounting ratio that summarises how certain inputs and output move relative to each other. This accounting entity has no necessary predictive power and does not capture most of the important factors determining economic performance.

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Paradox 2: Preoccupation with optimal deployment of labour in the short run retards economic development and social inclusion in the medium to longer term

2(a) Optimising labour’s input in production is the short run can generate deep and ongoing problems such as ‘skills shortages’ over the longer term.

One of the great mantras of the 1980s was that ‘labour market flexibility’ was needed to ensure that workers could be rapidly redeployed to meet unanticipated and emerging needs. Considerable effort was devoted to breaking down all manner of standards and systems that allegedly stood in the way of achieving this objective. The irony is that success in achieving this reform has laid the seeds for longer-term capacity constraints in the form of skills shortages. Short-run flexibility has been achieved by undermining the ability to develop coherently and to deepen skills on the job.

A good example of how this dynamic has emerged is provided by developments in the Australian metal and engineering sector in the 1980s and 1990s (Buchanan 2000, Buchanan and Briggs 2007). The doctrine of labour market flexibility was not confined to employer militants ideologically committed to marketising employment arrangements. Progressive employers and unions also embraced this policy objective. The metals restructuring model of the this period had three key elements:

- The abolition of narrowly defined and strictly demarcated occupational classifications. These were to be replaced by a more limited number of broadly defined skill levels, structured to facilitate career paths in the sector.

- The restructuring of training arrangements away from ‘front end’ skill formation, which had been the basis for traditional apprenticeships. Instead emphasis was to shift to competency-based training as part of a system of ‘life-long learning’.

- A shift away from hierarchical models of work organisation to more consultative methods based on teams.

Despite the clear intention of employer and union leaders to implement this reform agenda, reality at the workplace level ensured an outcome very different from that envisaged in the model (Buchanan 2000, Watson et al (2003), pp. 99 – 102). In the context of intensifying international competition and an industry policy focused primarily on cuts in barrier protection, the following changes occurred:

- Classification reform evolved to ensure a wider range of tasks could be performed by workers at any given classification level. Broad-banding, which was supposed to facilitate a deepening of the skills base by promoting new career paths, primarily boosted productivity by job enlargement and multi-tasking.

- While training reform reduced levels of trade training, this was not offset by increased support of post trade up-skilling. Rather, more trade workers skills were passed down the line and new types of formal training in quality and new management techniques consumed workplace training budgets.

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- Work organisation reform did not result in any major democratisation of life on the job. Rather, in line with new management philosophies, it resulted in consultative, ‘managed’ teams overseeing production on a day-to-day basis.

- Totally unanticipated in the model was the rise of non-standard work – it increased from 15 to 25 of the sector’s workforce between the mid 1980s and late 1990s.

The end result of this reform strategy has been the more comprehensive deployment of labour at existing levels of technical skill and no significant skill deepening across the sector. What is worse, the preoccupation with ‘full labour capacity utilisation’ has driven out the time for orderly reproduction of skill on the job. Unsurprisingly, the reforms were associated with significant improvements in labour productivity . Also unsurprisingly, they were and continue to be associated with the deep and ongoing ‘skill shortages’, especially amongst workers at trades level and above.

The dynamics identified in metal and engineering have also been documented in sectors as diverse as Victorian and NSW manufacturing more generally (Buchanan et al 2002, Buchanan and Briggs 2004), retail, hospitality, sport and recreation and community services (Buchanan and Hall 2003) and the medical workforce (Greater Metropolitan Clinicians Taskforce 2005).

2 (b): The socially excluded often need significant additional investment in their development before they can realistically become economically deployable.

There is much interest today in ‘making welfare pay’. This misses the point. Many people are on welfare for a reason. They need extensive support if they are to be successfully engaged in society, let alone the formal economy. Amongst prisoners, for example, trying to make their industry work ‘pay’ can limit the ability to give them the skills and competencies needed to gain a stable foothold in the labour market when they leave prison. Our detailed analysis of the Victorian prison industries revealed that short-run concerns with ‘cost recovery’ from central coordinating agencies in the Victorian public sector limited the ability of dedicated personnel in that State’s prison industries to make a real difference in reducing the costs of managing the ex-offender population. Declining recidivisim, not self-financing prison industries, is far better for social productivity (Buchanan and Considine 2007). In the case of the socially excluded, their core skills need to be developed if they are ever to become economically deployable. Neglect of this insight will make sustained improvement in social inclusion difficult.

Implication for policy of paradox 2: Humans are a complex ‘factor of production’. They need to be developed as well as deployed efficiently and sustainably. For too long policy has been pre-occupied with boosting ‘qualification’ levels in the abstract and turning vocational education and training into the short-run provision of immediately needed ‘competencies’. Most damaging of all has been the assumption that ‘labour market flexibility’ will deliver the adaptive capacity needed to meet unanticipated needs. It is time that greater support was given to coherent approaches to workforce development and the use of skills – especially within the workplace. Unless greater attention is devoted to getting a better balance between the development and deployment of labour, problems

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such as skill shortages and social exclusion are set to remain permanent features of economic and social life (Buchanan et al 2009, 2010).

Paradox 3 : Outputs and labour input are often not independent variables. Treating them as if they are can result in major inefficiencies

3(a) Labour inputs and the outputs of interest are often inextricably connected: the case of children’s services

It is taken as self-evident truth in the dominant productivity narrative that inputs and outputs are distinct variables that can be modelled independently. As we move to a world based on services, it grows harder to sustain this article of faith. The case of children’s services provides a good example. What is the output here? If we are simply interested in the safe ‘warehousing’ of children while their parents work, then we have one kind of ‘productivity’ problem: what is the smallest number of staff necessary to prevent infants from harming themselves. If, however, we are informed by modern neuroscience and education research, we will be concerned with the proper education as well as the care of pre-school children. This in turn has major implications for labour. How do we balance the need for to develop the teaching competence of such staff with the need for care skills? There is no simple question or answer as to how to ‘boost productivity’ in childrens’ services. We need to answer a very basic question first: what kind of childrens’ services do we wish to provide? And what is our reference point for measuring costs and benefits: minimising short-term costs as provided by the ‘safe child-warehousing’ model or investment in long term cognitive competence within an ‘early childhood education and care’ regime? (Evesson et al 2009, Bretherton 2010 and forthcoming a and b).

3(b) Taking ‘output’ as given and assuming ‘competition’ in its production will maximise efficiency can result in the profound misallocation of resources: the example of health care.

A hallmark of the dominant productivity narrative it is not just a story about current failure – it also purports to have ‘the solution’. Central to this doctrine is the assumption that ‘more competition’ and more ‘user choice’ is vital for improved efficiency. Implicit in this narrative is the presumption that the output of interest is self evident. Evidence of the damage which this habit of thought can cause for a population is provided by the operation and outcomes of the US health system. Table 3 summarises the essential facts.

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Table 3: Key indicators of health expenditure and outcomes in seven advanced industrialised nations

Health as % of GDP(2005)

Health as % of GDP(2005)

Infant mortality(per 1,000 births,

2006)USAGermanyCanadaNorwayAustraliaJapanUK

15.210.79.89.18.88.28.2

77.177.479.478.779.880.777.7

6.73.85.03.24.72.65.0

Sources: Health Expenditure - World Health Organisation Statistical Information System, http://www.who.int/whosis/, Life Expectancy – Tiffen and Gittins 2004, p. 6, Infant Mortality – Economic Policy Institute, State of Working America, http://www.stateofworkingamerica.org/charts/view /96.

These data are well known among health-policy makers. Despite spending more per capita than any other advanced industrialised country on health, the USA has the shortest life expectancy and highest infant mortality amongst this group of nations. The implications of this paradox are clear. If we are interested in improving the relationship between inputs and outputs, we need to focus on the problem of immediate concern (in this case life expectancy) and not assume that a model that takes output as self-evident and privileges ‘competition’ and ‘user choice’ in its provision will deliver optimal outcomes.

Unsurprisingly, improvements in health system performance often needs thoughtful and creative engagement with the complexity of service provided and the intricacies of skill development necessary to meet these needs. Health sector performance (in terms of reduced error rates and better recovery rates) often requires more staffing, not less (Gordon et al 2008). Overcoming doctor shortages can often be made worse not better by reliance on market mechanisms such as bidding up wages. The example of increased reliance on locum doctors in NSW Emergency Departments shows that, as wages for casual staff increased, levels of training actually fell, thereby intensifying the problem(Skinner et al 2007). Markets often get in the way of productive solutions. In sectors such as health, they are more often than not part of the problem, not part of the solution.2

Policy implications for Paradox 3. If we are interested in improving the quality of life, it is the connection between the economic variables, and not just their abstract ‘ratios’, that need to be the focus of analytical and policy attention. Because of this, it cannot be assumed that ‘competition’ and ‘user choice’ are, generally speaking, the preferred policy response to improving economic performance. Instead, careful attention needs to be devoted to understanding just what ‘the

2 It should also be noted that health outcomes for nations are not just a function of health system design and direct expenditures on health. The indicators reported in Table 3 are also closely associated with social and economic inequality. As researchers such as Marmot (2005) Wilkinson and Pickett (2009) have shown: better health performance is best achieved by reducing inequality.

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problem’ is that needs to be ‘solved’. Just as ‘labour’ is more complex than commonly assumed in the dominant productivity narrative, so too is ‘output’.

Paradox 4: The prima facie ‘productivity slowdown’ is occurring at a time of unprecedented abundance in Australia (and other advanced industrialised countries)

There is no doubt that the standard indicators of productivity performance point to a deterioriation in Australia’s national economic performance over the last decade in particular. But it is important to put this development in perspective. Throughout most of the last 30 years output has steadily increased – at an average annual rate of at around three per cent. What has changed dramatically is the connection between the increasing productivity of labour and returns to the workforce in terms of real wages. These trends are summarised in Figures 3.

Figure 3: Wages and labour productivity: Australia 1978 – 2008

80

100

120

140

160

180

200

1980 1985 1990 1995 2000 2005

Real wageLabour productivty (market sector)

Inde

x: 1

978:

3 =

100

Source: Data from ABS, A System of National Accounts, 2007 -2008. Graph prepared by Serena Yu

As Figure 3 shows, over the last 30 years there has been a major uncoupling of real wages growth from improvements in labour productivity. While real wages have risen by less than 20 percent , labour productivity has nearly doubled. The wages share of GDP as fallen from just over 60 to just over 50 per cent over the same period (Rafferty and Yu 2010). In the 1970s and 1980s, ‘real wage overhang’ was blamed for less than optimal economic performance in Australia. In the current situation the key problem appears to more one of ‘real profit overhang’ – or potentially more importantly – poor allocation of a dramatically increased profit share. It appears that much of this gain has accrued to the finance and mining sectors as many other sectors report increasingly tight squeezes on margins.

Traditionally wages policy has been concerned with the functional distribution of income. With the ‘decentralisation’ and ‘deregulation’ of wages policy it is difficult to even pose this question today. If we are interested in improving our economy’s performance, it may well be time to investigate ways

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of ensuring a fairer and more sustainable distribution of the social surplus. Poor distribution of this surplus, as well as poor arrangements in production, contributes to a country’s economic performance.

Policy implications of paradox 4: The problem for policy today is not how to ‘live with scarcity’ but rather how to manage and sustain abundance. Clearly the current policy regime associated with the dominant productivity narrative is not doing this well. Too often those advocating a fairer distribution of income and a more sustainable approach to economic development are asked: where will the money come from? This is clearly the wrong question. The more pertinent question for current times is: where has all that extra money gone? And what can be done to ensure that the growth dividend is better invested in the future?

Conclusion

This paper has noted that at every turn the current dominant narrative about the ‘productivity problem’ is empirically questionable, primarily because it is underpinned by inadequate, if not fundamentally flawed, conceptual foundations. This is no accident. The distribution of the gains of productivity is an intensely political process. Markets do not take one fixed, eternally relevant form. It is because of this that they do not operate as some kind of ‘value neutral’ mechanism allocating gains to where they will generate greatest long run returns in the abstract. Markets were constructed politically and continue to evolve politically. This does not mean that everything should be determined by the state – society’s ultimate political institution. The experience of the Soviet Union is testimony to the folly of such an endeavour. Once created, markets exercise distinct effects – often independent of the conscious will of the immediate players and the state. The challenge is to understand these dynamics and engage with them. In any society, this engagement involves the construction of social coalitions that shape the rules governing the allocation and distribution of resources. Arguably the most spectacularly successful coalitions – in terms of both increased material wealth and the fair and sustainable distribution of that wealth - were those that prevailed in western nations in the three decades after the second world war. Their guiding principle was Beveridge’s maxim: markets make good servants but poor masters of economic development. Their defining politics was that they included a social force other than simply the rich and powerful in governing the economy – unions. Organised labour was integral to such coalitions and the social settlements that prevailed in these nations – either as active participants (as in the Nordic model) or as a ‘would be’ participant whose priorities had to be accommodated in other nations. Clearly the post-war productivity regimes and the social coalitions underpinning them have disappeared. There can be no going back. The so-called golden age had its problems – especially for social minorities, for women and the environment. Any enduring improvement in productivity today will require the creative engagement with market forces so effectively elaborated by thinkers such as Keynes and Beveridge. But in today’s world the social coalition that needs to be involved in this engagement must be more diverse and embrace a wider, more complex agenda – especially on the issues such as the character and not just the quantity of work, production and consumption (Buchanan et al 2006, Buchanan et al 2009).

Throughout his life as a researcher in industrial relations and organisational change, Russell Lansbury explored issues relevant to this endeavour. From his early work on industrial democracy to his later

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work on comparative industrial relations he explored issues relevant to fair and sustainable social coalitions at the enterprise, sectoral and national levels. Those concerned about improving productivity today have much to learn from this work and the analytical traditions from which it springs. As the flaws in the currently dominant productivity narrative become increasingly apparent, we can only hope that more policy-makers and academic researchers will appreciate the significance of his contribution and that of the tradition to which he so ably and generously contributed.

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