The state of the working class

Outside of the scholarly and activist left, we rarely talk about class in a politically meaningful way. On the rare occasions it does come up, it is discussed in terms of distinctions based on culture, voting patterns and type of labour. Yet considerations of class have been re-emerging in mainstream political debate over recent years. Occupy and other post-GFC movements developed in response to tensions around class divisions. Class has also featured heavily in the mildly revolutionary rhetoric of Bernie Sanders, Jeremy Corbyn and European political parties such as Syriza and Podemos.

The starting point for talking about contemporary class relations is how people are situated with respect to the production and distribution of wealth. This idea is critical to understanding and contesting the conditions under which we live and work. Class is one of many frames through which to do this – race, gender, ethnicity and age are others – but it is an indispensable one under capitalism. It is important to note here that while we acknowledge the ways in which class can intersect with other subjectivities, such as race, gender and other ways people are excluded from economic life, our interest is in the material and economic dimensions of class (as opposed to a cultural framing that focuses on, say, levels of education, social networks or comportment).

There is, and has always been, fluidity between class positions. In the earliest days of capitalism, the emerging working and capitalist classes moved in and out of political allegiances with the aristocracy in debates over suffrage, food prices and working hours. Ever since, certain groups, such as pieceworkers and farmers, have occupied ambiguous positions, and thus present a perennial challenge to how we understand waged labour and the experiences of the working class. Changes in the economy in recent years, particularly since the end of the post-Second World War boom, obscure class divisions in new ways.

Beyond the distinction between people who live off the labour of others and people who live off their own labour, class can be seen as a collection of experiences that are tied to one’s participation in the circuit of capital accumulation. Such a fluid conception of class is essential in a context in which increasing numbers of working people are ‘their own boss’, or appear to own the means of production through their superannuation funds or shares in BHP. Indeed, in 2016, many elements of the working-class experience create illusions of agency, power and flexibility.

Precarious work is often cited as a marker of contemporary working-class life, but insecure work is nothing new. Job security, regular hours and consistent entitlements were, arguably, an aberration of the post-Second World War period, enjoyed primarily by male – mostly white – workers in wealthier industrialised economies. During the same period, women in Australia were without access to a single-parent benefit or no-fault divorce, which meant that stability and security was tied to their marital relationship. For workers of colour, a history of forced labour (for example, the blackbirding of Pacific Island workers in Queensland and Aboriginal workers in Western Australia), combined with exclusion from trade unions and discrimination, both in the workplace and society more generally, meant a higher degree of insecurity than that enjoyed by their white counterparts. Insecure work remains racialised and gendered, with disproportionate impacts on women and people of colour. But as worker rights are liquidated across the economy, new forms of insecurity proliferate – in addition to those we have grown accustomed to.

In 2011, the Australian Council of Trade Unions (ACTU) commissioned an independent inquiry into insecure work and its impact on workers, their families and the community. The final report, Lives on Hold, noted that almost 40 per cent of workers in Australia are engaged in some form of insecure work, including casual employment, fixed-term contracts and independent contracting. The inquiry also reported that insecure work is found in every sector of the economy, although it manifests in different ways. For example, labour hire and fixed-term contracts are key forms of insecure work in the public service. Casual employment dominates the retail, hospitality and higher education sectors, where a significant number of employees are ‘permanent casuals’ – in other words, they work regular hours over a long term, but without the benefits and entitlements attached to ongoing employment. In construction, transport and professional and scientific services, workers are engaged as ‘independent contractors’, often on sham contracts that disguise the employment relationship. This allows employers to avoid paying entitlements provided for under Australian law, such as holiday or sick leave.

Lives on Hold not only shed light on the prevalence of casual, fixed-term and otherwise insecure work, but also confirmed the growth of these kinds of arrangements: over a period of almost two decades, full-time casual jobs grew at a rate of around three times that of full-time ongoing jobs. Insecure work is also increasingly expanding into areas of the economy previously considered bastions of stable work, such as education and the public sector.

In the United States, research predictions show that over 40 per cent of the labour force will be ‘contingent’ – that is, freelancers and independent contractors – by 2020.

While a majority of workers in both the US and Australia are still employed in an ongoing arrangement – and ABS data shows that this has not shifted significantly over the past ten years – the growth in prevalence of insecure employment is driving both epistemic and material changes in the world of work. Epistemically, a conceptual shift is changing how work and the employment relationship are understood. Materially, the rise in insecure work arrangements puts downward pressure on conditions for all workers, with consequences for wealth and income distribution. For example, the explosion of insecure work in the tertiary education sector over the past two decades has led to increased workloads for all staff, including those employed on an ongoing basis.

In the cleaning industry, the use of sham contracting allows for the easy termination of cleaners from contracts and the abdication of responsibility for employment or worksite problems, while also enabling employers to avoid payroll tax, superannuation and insurance obligations. This undermines established industry awards and collective-agreement terms for all cleaners and, across the industry, pushes down standards and wages.

The growth of insecure work is emblematic of a broader trend towards the shifting of risks and costs from employers to workers. This is part of what David Harvey describes as neoliberalism’s capital-driven class project, which aims to claw back many of the concessions of the postwar boom, ‘carried out by the corporate capitalist class as they felt intensely threatened both politically and economically towards the end of the 1960s into the 1970s’.

This shift in risk is reflected in, for example, demands that workers employed as independent contractors bear the cost of their own tools, equipment, training and insurance. This applies to owner-drivers in the transport industry, construction subcontractors, commercial cleaners and care workers, among others.

With homecare work on the rise in Australia, care workers are increasingly required to drive their own cars to clients’ homes and take responsibility for such things as the planning, reporting and coordination of their work. Countless more care workers collect data, write reports and undertake contract management processes previously coordinated by employers. Importantly, as with cleaners who move around the city from one job to another in order to cobble together an income, some homecare workers are paid minimally or not at all for their non-client time. However, this is not uncontested. Legal cases challenging such arrangements are on the rise globally. A European court recently ruled that travel time should be considered working time, while a New Zealand court decided that care workers must be remunerated for sleepover time, instead of being paid an on-call allowance.

Under the guise of self-employment, many workers take on additional debt in order to meet job requirements. Uber drivers are often obliged to buy the cars they need for their work, with no guarantee of employment or income. In this way, workers engaged on insecure terms insure their employers against the risk of market fluctuations and downturns.

In other words, contemporary class can be understood by the ways in which a contract for paid labour is formalised and the risk-management processes it creates.

Risks and costs of the business cycle have always been imposed on workers. But the means by which this is achieved today are quite different. Rather than reducing wages – or, perhaps, as well as reducing wages – employers seek to avoid the responsibilities of the employment relationship, such as workplace health and safety, insurance and leave entitlements. The transmission of risk to working people is perhaps most pointed in the case of the emerging ‘gig’ or ‘sharing’ economy, in which online platforms like Uber (a transportation network that is an alternative to taxis) and Fiverr (a marketplace where anyone can offer their skills) are used to connect individual workers to individual consumers.

Undoubtedly, the gig economy is a result of enormous technological developments, particularly in the realm of information and communications technology, which has enabled the construction of online platforms. But the gig economy is also a response to a post-GFC global context of underemployment, unemployment and inequality.

There is great variety in how gig-economy digital platforms operate. Airbnb doesn’t set employment terms; rather, it allows hosts to set their own rates for letting rooms, while providing a space through which to access the market. Uber, on the other hand, sets the terms for rides, including prices, and provides drivers with a platform through which to access client-passengers. Fiverr and Airtasker provide an online forum through which individual workers can offer their goods and services at their chosen price. (with nine million users worldwide, including in Australia) and the predominantly US-based platforms HomeHero and Room2Care connect individual carers with clients, sometimes on an hour-by-hour basis, often using local average rates to set remuneration instead of any industrial instruments. While care platforms have not yet taken off in Australia as they have elsewhere, the consumer-oriented approaches of the National Disability Insurance Scheme and the My Aged Care platform lend themselves to similar future developments. Such platforms also have the potential to disrupt traditional job structures, with work functions disaggregated and performed as piecework. Other platforms facilitate more direct instances of hyper-competition: uShip, for example, allows removalists to bid each other down in reverse auctions, thus undercutting their industry in order to get a hire.

But these kinds of developments are not limited to online platforms. The University of Sydney’s Centre for Continuing Education provides an interesting – and disturbing – example of hyper-competition in education. Prospective teachers contact the centre to pitch a course they would like to deliver, spending many (unpaid) hours preparing the course. Teachers are required to suggest a student fee when pitching the course, which usually involves guessing what their competitor-colleagues might charge and how much students would be willing to pay, effectively gambling on various elements of risk. This creates a clandestine environment for market competition. ‘There are no guidelines offered on this, nor is it apparent what bearing the nominated figure might have – if any – on whether to approve the proposed course or not,’ volunteered one academic.

As a prospective teacher, you don’t want to scare the employer off by overcharging, but you also don’t want to dig your own grave by undercharging. The lack of transparency makes the prospective teacher very vulnerable. It’s almost as though you’re being given an open invitation to either exploit yourself by undercharging or rule yourself out altogether by nominating a figure beyond the one the CCE would be willing to consider. On top of all of this, the course-proposer is given no indication whatsoever what proportion of the money paid by the student will go into the CCE’s pocket and how much will go to the teacher – that makes this procedure of asking the teacher to nominate what they think a reasonable amount of money to charge a student even more meaningless and problematic.

While the gig economy remains relatively small (the Productivity Commission recently estimated that around 80,000 Australians obtain work on peer-to-peer platforms), its emergence is emblematic of a significant cultural shift in the concept of what work is. Who is an employee or employer? Is your manager your boss, or does the modern supply chain make such definitions less meaningful? What do we ‘do’ for a living? Not only does the social context for work change and identities shift, but also new sites of contest open up that further complicate class boundaries. Is an Uber driver a small business owner or a worker? Is the graphic designer bidding her services on Airtasker ‘working for herself’? Many of the fastest growing occupations in Australia and worldwide are operating in this way, and this cultural shift should not be underestimated.

With increasingly de-unionised workforces, and a lack of clarity as to the industrial terms underpinning work, there is huge potential for the minimisation of labour costs and, consequently, higher profits to the capitalist class. The hard-won entitlements of an employment contract – sick leave, family leave, holidays and so on – are dissipating. Currently in Australia, formal institutions still define and codify work and employment, which will perhaps lead to a deferment of the transformations seen in the labour markets of other countries, but we still see altered expectations of how work functions. A recent threat of legal action against Airtasker by Unions NSW may test the capacity of Australian industrial law to maintain the integrity of workplace rights in this changing economy.

Much of what is new about the contemporary iterations of insecure work is the association with ideas of ‘flexibility’ and ‘choice’, epitomised in these words from the founder of Invoice2Go, Chris Strode:

We already own the secret to our success. Everyone, young or old, has the tools they need to get ahead. And we’re living in the one point in history where it’s never been easier to bring your valuable skills to people who need them. I know this. Because I see people doing it every day. People taking advantage of a huge opportunity within our economy that is still being underrated. The gig economy, or the freelancing economy, whatever you want to call it, is creating a huge independent workforce built on the back of individuals empowered by the knowledge, skills and talent they have to contribute.

Strode’s exhortations for ‘empowered’ individuals to ‘get ahead’ is typical of the gig economy’s illusions of personal power and agency – what looks like choice is highly constrained; capital continues to dictate the terms of our labour.

This recent precariousness has been accompanied by the de-collectivisation of provisioning for people’s basic needs, and the increasing role of financial markets in our daily lives. Finance is one of the primary ways working people meet their needs when they are unable to do so through wages and when the state pulls back, particularly as the costs of social reproduction become more onerous – for example, due to increasing costs for health care, aged care, education and housing.

A 2015 report from the University of Canberra’s National Centre for Social and Economic Modelling found that household debt in Australia quadrupled between 1988 and 2015. By far, the most significant type of debt is related to housing and investment properties. Despite this, renters face greater debt repayment stress than mortgage holders, indicating reliance on credit for other needs. Low-income households are under the greatest financial stress, spending around 60 per cent of their income in repayments. This is a worsening trend: between 2004 and 2014, the debt-income ratio doubling for households in the lowest quintile of income. Almost 40 per cent of low-income households have difficulty making repayments each month.

Having access to finance – thereby temporarily releasing the pressure of economic insecurity – creates an illusion of agency, even as it draws working people more firmly into the web of capital accumulation. As with the growth of freelance and other insecure work, all of this is hidden behind a veneer of choice. But, particularly for poorer households, the options to choose from are bleak.

Like the gig economy, the debt economy also serves as an excuse for individual responsibility and morality, as exemplified by the above-mentioned debt report: ‘The financial stability of Australian households will ultimately rest in their own hands. They must take on appropriate levels of debt relative to their incomes.’

A similar dynamic is at play in the context of superannuation, a financial response to retreating social security provision. There is approximately two trillion dollars of workers’ money invested in Australian superannuation, an enormous sum for a population of around twenty-four million. More than 10 per cent of workers’ wages are siphoned off each year into these black-box accounts. Despite the lack of control workers have over those investments, they bear the responsibility for having enough money in those accounts to fund their retirement.

The privatisation of this previously collectively managed responsibility to care for people after their working life is one of a raft of policy developments since the 1980s that has meant the individual privatisation of risk, explored in the Australian context by Michael Rafferty and Serena Yu for the Workplace Research Centre. It is part of a shift towards a society in which relations are structured as financial, in what Maurizio Lazzarato describes as the filtering of social relations through credit and debt.

Superannuation again gives the illusion of worker agency, and is sometimes described as ‘workers’ capital’, with the implied possibility of industrial democracy. But the reality of superannuation, and its reflection of class relations, is better demonstrated by the recent debates about limitations on concessionary contributions. Regulations permit those wealthy enough to make voluntary contributions to their super and by doing so obtain enormous tax concessions. For working people, these debates are largely irrelevant. The pressing question is whether there will be enough to retire (a question of increasing importance with a growing workforce of independent contractors who make their own super contributions). There is a direct conflict between these two public policy options, reflected in research by the Australia Institute in 2014, which showed that a public pension for all Australians over sixty-five could be funded by abolishing superannuation tax concessions for the rich. Arguably, this would work better for low-paid workers and the (for the most part) women who sacrifice years in the labour force to do unpaid domestic labour.

The consequence of shifting risk from collective institutions to individuals and households is that people seek out individual solutions. In such a context, it is little wonder it has become more difficult for workers to recognise ourselves as a class and to locate ourselves within the structure of capital accumulation. We become entrepreneurs and self-employers in the workplace. We become the managers of our own financial risks at home through loans, insurance and pension funds, bearing these burdens for social reproduction that previously have been collectively managed. Debt default is a moral issue, rather than a consequence of poverty.

Importantly, though, this is not a story of downtrodden workers with no power or agency. Rather, it is a reminder that this is the function of class analysis: being able to understand and recognise the realities of how capital circulates in the present moment, and how it can be effectively contested.

A recent dispute between the gig-economy platform Deliveroo and its London-based rider-contractors demonstrated the importance of both old and new strategies for class struggle. In possibly the first successful industrial action by gig-economy workers, Deliveroo riders crowdfunded their strike action against the company’s attempt to cut their pay (other less successful actions have been taken by, for example, taxi drivers in New York opposing Uber and other ride-sharing services and Amazon’s Mechanical Turk workers). Deliveroo riders raised more than £10,000 by the time the strike ended, and garnered significant public support, including from the unlikely quarters of the Tory government. The workers’ action comprised a combination of tech-savvy contemporary organising and communication techniques, along with old-fashioned exertion of collective power.

For all of these reasons, class relations cannot be understood by reference to particular types of work or blunt categories like blue- or white-collar worker. Rather, it is through our lived experience of these changing realities that we can understand our relationship to capital and production. Questions about the limits of choice and agency are instructive in understanding the impacts of changes in the world of work, social reproduction and finance. Lifting the veil of our monetised and marketised social relations is a crucial element of being able to recognise our own class positions, to identify avenues of resistance and to genuinely increase our autonomy in the workplace and beyond.




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Claire Parfitt

Claire Parfitt is a PhD candidate at the University of Sydney, as well as a sometime researcher and campaigner for trade unions and NGOs, working on labour rights, food justice, climate change, migration and finance.

Kirsty McCully

Kirsty McCully is currently a wrangler of six-month-old twins. She has worked in the union movement in New Zealand, Australia, and globally, most recently as the Director of the UNICARE sector for UNI Global Union.

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