agreement and forcing the Communications Workers of America to deal with seven regional telecom companies as well as the residual AT&T itself.31
Three more key unionized industries saw their bases rapidly eroded by the larger global restructuring already under way. Job losses in textiles, garments, and primary metals accounted for 80 percent of the decline in production-worker employment from 1980 to 1990, due largely to imports.32 In textiles and garments, the unions lost almost all their traditional industrial base. In the steel industry, beset by international competition for some time, production worker employment fell from 342,000 in 1979 to 171,000 in 1984. The following year, the United Steelworkers’ pattern agreement with the major steel companies was terminated by the employers.33
By the end of the 1980s, the structure of industry and that of organized labor and its bargaining practices had been substantially altered. Bargaining was highly decentralized and, hence, more competitive. The political and social climate in which the unions functioned had also changed dramatically. The social movements of the 1960s and 1970s had faded and the “Keynesian” era had been replaced by an increasingly aggressive neoliberalism. The ideas of Hayek and Friedman had been given a power boost by the centers of capital in the 1970s through organizations such as the Business Roundtable, a coalition of the leaders of the nation’s biggest corporations in industry, commerce, and finance founded in the mid-1970s.34 As one journalist put it, “During the 1970s, business refined its ability to act as a class.”35 These developments were followed by the election of Ronald Reagan in 1980 and the dominance of neoliberalism in US politics. But capital’s power grew not only in the political arena; the 1979–82 defeat of organized labor had allowed it to increase capital’s power in the workplace as well. And in the 1980s business wasted no time in reorganizing work in an effort to increase productivity and profitability even more.
“Our Most Valuable Asset”
Continuous gains in surplus value and profitability could not be sustained on the basis of ad hoc concessions from the unionized sections of the workforce alone. The productivity increases of the 1980s were not primarily due to technology, old or new. Here periodization is important. Investment in equipment and software actually grew more slowly in the 1980s than in the 1960s, 1970s, or 1990s in real terms. In manufacturing it grew by only 18 percent in the 1980s, almost half the level for the private sector as a whole and far less than in any other decade from 1960 through the 1990s. Manufacturing productivity, on the other hand, rose by almost 5 percent a year in that decade.36
Thus, with unions weakened and resistance low, capital turned away from capital investment as the main source of increasing productivity and profitability to reorganize work. Ideas that had been around and largely ignored for some time were now reformulated and taken up by managers desperate to compete and continue to improve profitability. These managerial innovations came in a cluster in the mid-1980s, as rapid as the union decline of 1979–82. Virtually all were about intensifying work through various types of work reorganization schemes, motivation techniques, and/or methods of control. While “human resource management” (HRM) had a gestation period in which it overtook “personnel,” it was in 1984 that the two major statements of this new approach to controlling and motivating the workforce were published. The two major schools of HRM were represented by the publication in 1984 of Strategic Human Resource Management by Formbrun et al., representing the University of Michigan school, and Managing Human Assets by Beer et al., representing the Harvard version. The two schools were allegedly differentiated, respectively, as the “hard” and “soft” versions of HRM.37 The mantra of all was that the employee, as individual, was the company’s most valuable asset.
In the same year, Atkinson published his model of the “flexible firm.” This placed a new emphasis on peripheral workers, contingent work, and outsourcing, a design that seemed to contradict the notion of the employee as a firm’s most valuable asset.38 The effectiveness of these new management approaches in sustaining the expansion that began in the 1980s is debatable. What matters is that they provided management with new, or at least refined, tools with which to introduce change and cheapen and/or intensify work. Furthermore, the ideology that underlay HRM and flexibility was designed, as Keenoy argues, to “undermine, if not destroy, the institutional basis of collectivism and legitimate the transition to an individualized unitary concept of the employment relationship.”39 Their uptake was a reflection of management’s hunger for new ways to motivate or simply push the workforce to perform more efficiently, as well as for an ideology appropriate to the new demands of international competition.
Even more important than these managerial prescriptions was the rapid introduction of “lean production” in the United States during the 1980s. Termed “management-by-stress” by critics Parker and Slaughter, this characterization captured the way in which these new production norms reduced inputs while increasing output. This import from Japan combined teamworking, continuous improvement, speedups, just-in-time delivery, multitasking, extensive outsourcing, “reengineering,” and Total Quality Management (TQM) to produce a constant tightening of the production system. It was not a replacement for mass production or Taylorism, as many of its exponents argued at the time, but a means of removing barriers to faster production with fewer workers.40 The introduction of lean norms in the United States was led by Japanese firms adept at it. Between 1979 and 1989 Japanese auto companies opened eleven “lean” assembly plants in the United States, only two with a union workforce, while the US Big Three closed nine unionized assembly plants. With the UAW failing to organize these new plants, by the end of the 1980s 39 percent of the industry was nonunion. In the parts sector of the industry non-union facilities proliferated as outsourcing increased, bringing the nonunion workforce to 76 percent of that sector.41
The new competition from Japanese firms producing in the United States forced the US automobile companies to introduce lean methods as rapidly as possible.This typically involved the carrot of employee participation or labor-management cooperation, schemes that were rapidly embraced by most union leaders. Although originated in 1982, it was, once again, in 1984 that General Motors negotiated its fully elaborated “Jointness” program, giving the union representation on a complex of committees meant to consult, though not bargain, on production problems and plans.42 The following year, NUMMI, the GM-Toyota joint venture, was opened in California with the entire range of lean production procedures and record-breaking speeds of production.43 From their incubation in auto, lean norms, including TQM and other “quality” programs, “reengineering,” teamworking, and the extensive outsourcing associated with lean production, spread across manufacturing in the 1980s. Estimates of the extent of lean methods vary from at least one-quarter of all US firms to 80 percent of industrial firms having some version of these by the early 1990s.44
Lean methods would spread beyond manufacturing in the 1990s. In 1993, for example, lean hit the telecommunications industry at US West in the form of reengineering, reorganization, and flexibility. In the same year, AT&T adopted its “Workplace of the Future” program of labor-management cooperation and lean reorganization.45 Greenbaum’s study of office work found that by the early 1990s, TQM, “broadbanding,” work reorganization, “reengineering,” and flexibility were invading office work.46 In the 1990s they had spread even to the nation’s healthcare industry. As Kumar wrote about US hospitals, “Over the years, they have adapted Lean Manufacturing, Six Sigma and supply chain strategies in order to become more efficient.”47
Did lean production, enabled by HRM, TQM, and employee involvement, aid the sustainability of the 1980s expansion? I would argue that it did. Smith’s review of the literature on the effectiveness of lean methods shows that most studies judge it more effective than older production methods or other strategies, such as downsizing, in terms of productivity.48 While overall productivity growth during the 1980s was not impressive, in manufacturing, where lean production was now common, it was. There, productivity rose by 37 percent or 4.6 percent a year from 1982 to 1989, twice the average rate for the 1960s and 1970s. In the automobile industry, incubator of lean production, it rose by 47.4 percent from 1980 through 1988, an average of 5.3 percent a year.49
Smith’s
