Between the wars, the heavy unemployment in Great Britain and keenly competitive conditions abroad were factors which had to be taken into account in… - Hugh Gaitskell

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Between the wars, the heavy unemployment in Great Britain and keenly competitive conditions abroad were factors which had to be taken into account in wage negotiations. Employers were afraid that higher wages, by adding to their costs, would make it more difficult for them to sell their goods, especially in export markets. If this happened unemployment would increase and workers' representatives had to bear this in mind also. The larger the number of unemployed, also, the more difficult it was to maintain full workers' solidarity, i.e. an employer could resist a strike, and make cuts in wages more easily the more workers were out of work. Thus in the last resort it was the existence of heavy unemployment, at home and abroad, which allowed employers to resist wage claims and discouraged workers from pressing them too far.