Unemployment

Part of Orders of the Day — Supply – in the House of Commons at 7:12 pm on 27th July 1982.

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Photo of Mr Esmond Bulmer Mr Esmond Bulmer , Kidderminster 7:12 pm, 27th July 1982

The hon. Member for Tottenham (Mr. Atkinson) can be relied upon to provoke Conservative Members into feeling that some of his remarks should be rebutted. I shall resist the temptation, although I agree with him about the need for leadership in industry. I wish to concentrate on what Government action would lead to investment in industry by those who have the capacity and responsibility to take such decisions.

I have recently had the opportunity to discuss the present position with major employers in my constituency. In Kidderminster, in common with the West Midlands, we have had the same problems which have been attracting the attention of the House for some time. Among industrialists I find that there is a general recognition that there is a limit to what Government can deliver. The problems go back for years, to the time when the Americans printed money to finance the Vietnam war and the space programme. That was followed by the oil crisis. These factors created a position in which industry throughout the free world had grave problems. There is an enormous temptation for nations to play "beggar my neighbour". I hope that that temptation will be resisted.

I believe that my right hon. and learned Friend the Chancellor of the Exchequer can take some credit for having insulated this country from the worst of the effects of high interest rates in recent months. There is every chance that our interest rates will stay below those of America and that theirs will come down. If that happens and energy prices remain constant, there is a chance that the recovery which is developing here and there and unevenly can be sustained.

Among people I have talked to there is a consensus that the first priority must be to continue the battle against inflation and drive interest rates down. They back the Government's policies on those objectives. They wish to see Government spending devoted more to capital projects and less to incomes. They wish to see nationalised industries behave more efficiently, and reduce the level of price increases passed to the private sector. Overall, they wish the Government to continue the fight to restore confidence in money and to create a better balance between the private and public sectors.

I often wonder whether those Opposition Members who advocate withdrawal from the Common Market understand what effect that has on the confidence of many people in industry. It is an invitation to many companies to invest on the mainland of Europe and influences many companies from abroad against investing here. I have recently returned from France. The French Government's actions have had an almost catastrophic effect on confidence. I have little doubt that those actions will be reflected by rising unemployment in the next few months.

When I talk to my constituents I find that there is a consensus that Government and industry have to devote more time to explaining the effect of economic processes and the relationship of cause and effect. Over the past couple of years those of us who work in industry have been through a tough time, and many have found an enormous response from the people who work in our companies, and a recognition that we are all in the fight for survival. If the lessons can be learnt—of the effect of wages outstripping productivity and the price that is paid if property rights are written in to jobs—there is a greater chance that more jobs will be created in the future and that those jobs will be maintained.

Many trade union organisers, officials and shop stewards have a difficult task ahead of them. They have to put across two paradoxes. The first is that if less is taken more will be received and that the important factor is what the money will buy. West Germany has learnt that lesson. The second is that if one is prepared to change a job one is more likely to have a job. The United States of America has learnt that lesson. That does not work here at the moment because we delayed reacting to technology for far too long.

Companies should have joint working parties of management and trade unions to monitor the effect of technology and to assess its impact. Adjustments can then be made gradually and not as traumatically as they have been made in the past couple of years. There would then be much more creative thinking about the nature of the working week, how shifts can be altered, and how more people can be employed at the same time. I welcome the Chancellor of the Exchequer's statement about job-sharing, which could be relevant to married women and office workers, where new technology will replace many jobs in the next four or five years. That new technology will, however, create other jobs.

The lessons from my constituency since 1974 have been plain. My constituency depends on the carpet industry. In 1974 there were more than 12,000 jobs. By 1980 that figure had fallen to 7,500 and today it is 5,800. Most hon. Members can find one major industry of which that is true. However, the lesson for Kidderminster is that the worst is now over, although there will not be any rapid pick-up. Of the 22 companies that I have spoken to in my constituency, only one expects to employ more people next year. Therefore, two further lessons can be drawn. Our dependence on small business for jobs—