Farewell to HRM? Personnel practices in Japanese manufacturing plants in the UK

While Japanese manufacturing investment burgeoned in the UK in the 1980s and 1990s, its relative size remained small. Nevertheless, its impact was greater than its size. At its extreme it was championed by the 'new right' as the way forward for industrial practices, while manufacturing organizations in the UK were quick to attempt to emulate Japanese management practices. Core to these practices was the management of human resources. Coincidentally in the 1980s a new model of personnel management was being championed, namely human resource management (HRM). This was eagerly embraced by UK academics and was translated into two distinct forms, 'hard and soft'. Despite appearing mutually incompatible, the hard and soft forms were forged into a unified model. This paper, drawing on an empirical analysis of personnel practices in Japanese manufacturing plants in the UK, searches for a conjuncture between the HRM model and 'Japanese' models. It concludes that, while there are similarities between the two, there are also distinct differences. Moreover, where similarities exist they are with the hard variety of HRM.     

Will Brexit speed a seismic shift in UK trade patterns?

• The UK's trade pattern has shifted significantly away from the EU since the 1990s. Our analysis suggests that this shift will continue in the decades to come, with the EU share in UK goods exports potentially slipping to around 35% by 2035. Shifts in relative prices from moves in tariff and especially non‐tariff barriers could lower the share further.
• Over 60% of UK goods exports went to the EU in the late 1990s but this has fallen to around 45%. Slow EU growth is partly to blame, with UK exports to the EU barely expanding since 2007. But our analysis also shows that a 1% rise in EU GDP leads to only around half the rise in UK exports to the EU that a 1% rise in GDP in the rest of the world induces in UK exports to non‐EU countries.
• Based on our findings and OE forecasts of long‐term growth in the EU and the world, the EU share of UK goods exports could fall to 37% by 2035 and around 30% by 2050 – back to its 1960 level. The share of services exports to the EU has held up better but is lower than for goods, at around 40%.
• Weakening growth of UK exports to the EU has taken place despite the development of the EU single market since the early 1990s. Indeed, based on our projections UK goods exports to the single market could drop below 5% of UK GDP by 2050. These projections make no allowance for Brexit effects, but the declining importance of exports to the EU single market could colour prospective Brexit negotiations.
• Simple income‐based projections of potential country shares in future UK exports suggest a further swing towards emerging countries (EM) in the decades ahead, especially China and India. Exports to EM could approach 40% of the total by 2035. A shift in the pattern of trade preferences and restrictions faced by the UK post‐Brexit could spark even larger shifts in the structure of UK exports.

     

How likely is a UK recession after Brexit?

• In the wake of the UK Brexit vote, forecasters have rushed to downgrade their growth forecasts for the UK, with some now expecting a recession. Using the Oxford Economics' Global Economic Model, we examine how likely a recession is by looking at the shocks the UK economy faces and the policy responses. We conclude that while a sharp slowdown is likely – in line with our own new forecasts – a recession is unlikely.
• Many UK forecasters are now predicting a recession in 2017, even though ‘stand‐alone’ recessions in industrial countries are rare. Our forecast is less downbeat. The UK faces a series of negative shocks including to consumers and business confidence, but growth will be supported by the weaker sterling and likely policy responses.
• Using the Oxford Economics' Global Economic Model, we show that to shift our baseline forecast of growth of 1.1% next year to zero would require a very severe negative confidence shock. Our new baseline already assumes a shock equivalent to one‐third of that seen in the global financial crisis (GFC). All else being equal, the shock would have to be around two‐thirds of that in the GFC to cut GDP growth to zero in 2017.
• Our new baseline also does not incorporate all the possible policy levers the UK can employ. We currently assume the Bank Rate drops to zero, but if a ‘rescue package’ of £75 billion of QE and a fiscal stimulus equal to 1% of GDP was also added, then the shock to confidence needed to get zero GDP growth would have to be similar to that seen in the GFC. We do not consider this likely given the scale of financial stress and credit restriction that occurred globally at the time of the GFC.

     

Whither the Japanese employment system? The position of the Japan Employers’ Federation

This article analyses a policy of the Japanese Employers’ Federation regarding the ‘desired direction’ of the Japanese employment system. The analysis shows that the Federation in a number of respects advocates radical change, but also that the overall position regarding the relationship between continuity and change is of an ambiguous or unresolved character.     

Has the border narrowed?

In the late 1980s Canada’s provinces traded 20 times more with one another than with US states of comparable size and distance. In other words, the Canada-US border exerted a strong effect on the pattern of Canada’s continental trade patterns. However the formation of the Canada-US Free Trade Area could have reduced the impact of the border on bilateral trade. Surprisingly, estimates from a gravity model of aggregate Canadian trade reveal no evidence of a significant, sustained fall in the border effect between 1988 and 1996.     

Has the November Effect Replaced the January Effect in Stock Markets?

Results of previous studies support the November effect of the 1986 Tax Reform Act (TRA) on certain stock portfolios. The rapid growth of mutual funds driven by the fundamental changes in the retirement benefit system in past decades may expand the seasonality from portfolios to stock markets and lead to a replacement of the January effect with the November effect in stock markets. Results of this study support the January effect in the large‐cap and small‐cap stock markets in the pre‐TRA period, although the January effect may share a large portion of co‐variation with the size effect. However, the November effect is independent of the size effect. Furthermore, a major shifting process of the January effect to the November effect occurs in both the large‐cap and small‐cap stock markets. The significant result of the November effect in the post‐TRA period questions the claim that fund managers are capable in mitigating potential price pressures. Copyright © 2011 John Wiley & Sons, Ltd.     

Is High Inflation Here to Stay in the UK?

The first decade of monetary policy independence saw a period of low and stable inflation, but over the past six years this has given way to higher, and more volatile, inflation. The increase in inflation rates has both external and domestic origins. Higher commodity prices, in particular food, and rising prices of manufactured goods imported from emerging markets have been important. In both cases the sharp depreciation of the pound in the aftermath of the financial crisis has compounded the impact on the UK. There has also been a marked step upwards in domestic inflationary pressures which has largely come from administered & regulated prices, such as domestic energy prices and university tuition fees. These categories account for just 10% of the inflation basket, but over the past six years they have contributed 0.9ppts to an average CPI inflation rate of 3.1%…     

Does the market provide sufficient employment protection?

We ask whether there is an efficiency rationale for public intervention in the form of an employment protection policy. Unlike most of the literature supporting current employment protection legislation we allow employers and workers to include severance payments in their private contracts. We focus attention on a model where firms learn over time about the value of the match. If future wage bargaining cannot be prevented, and even though severance payments may be part of the equilibrium contract, separations are too frequent (private employment protection is insufficient). Mandatory severance payments are not a remedy for this inefficiency. Instead, a Pigouvian tax/subsidy scheme will correct the inefficiency by enhancing employment protection.     

Can the consumer drive the UK recovery?

Consumer spending has consistently disappointed since the onset of the financial crisis, hampered by a severe squeeze on real wages and the need to deleverage. Spending is currently more than 3% lower than the late‐2007‐peak, a marked contrast with previous recoveries when spending had risen well above previous peaks by this stage. However, the consumer finally showed signs of life in 2012 following a firm rebound in real household incomes. This improvement was driven by robust growth in employment, weaker inflationary pressures and the high uprating of social benefits…     

New unions in the UK: the vanguard or the rearguard of the union movement?

Between January 1999 and March 2010, 34 trade unions entered the Certification Officer list or schedule in the UK. This article reports on a survey of those unions, discussing the extent to which they represent new forms of unionism and the possible implications for union revitalisation.     

Clinical negligence in the UK: throwing the baby out with the bath water?

As the total cost of clinical negligence claims has grown in the UK in recent years, calls for reform have resurfaced. The government now plans a White Paper on the subject next years. This paper assesses some of the economic arguments surrounding such reform. It suggests that the principle of negligence performs a useful economic function, that there is sum uncertainty surrounding the precise costs of the UK's clinical negligence, and that costs of alternative systems may sometimes be larger than they first appear.     

Has the Internet changed the wage structure too?

By using recent Current Population Survey (CPS) data sets, this paper investigates whether workers who use the Internet at work earn a higher wage than otherwise similar workers who do not use the Internet at work. Estimates suggest that there was a substantial premium to Internet use in 1997 of about 8%. However, this premium disappeared very quickly thereafter, and there are grounds to believe that it is now negative. This result is in stark contrast with that for computer use.     

A resilient social economy? Insights from the community food sector in the UK

At a time of global economic and environmental crisis, academic and policy debates are re-emphasizing the potential of the social economy in providing an alternative development model that reconnects communities with their resource-base and enhances their ‘resilience’. The goal of this paper is to explore this potential through a focus on the practices and values of those who are concretely involved in the social economy. Based on data collected on five community food enterprises in Oxfordshire, UK, the analysis focuses on the perceptions of social entrepreneurs in relation to the ‘alternativeness’ of the social economy, its potential for expansion and its resilience. The research highlights the capacity of social entrepreneurs to empower local communities through a process of collective mobilization of local resources. Theoretically, this study generates new insights into the nature and meanings of resilience as a process of creation of more self-reliant communities of people, places, tools, skills and knowledge. From a policy and practice perspective, the paper raises the need for regional development strategies that capture the gains of these isolated initiatives, particularly in relation to their innovative capacity to create a shared vision that fosters synergies between local ecological, social and economic resources.     

What influences the progression of employment rights disputes?

This study of employment rights disputes in New Zealand accessed all parties to 14 disputes. Despite a legislative requirement to preserve relationships, only three survived. Dispute type, interaction mode and the parties' relative influence affected outcomes. These findings have implications for managers and policy makers regarding alternative dispute resolution systems.     

Labour's interest in corporate governance in the UK: are workers on the board back on the agenda?

This article investigates labour's interests in corporate governance in the UK. Contemporary political economy conditions generate a confluence of factors that stimulates new demands and engagement strategies. Labour actors endeavour to forge corporate governance innovation through utilising cultural institutions in the regulation of firms in capitalist markets.     

Shrinking the state or the Big Society? Public service employment relations in an era of austerity

The Big Society is an integral part of the coalition's plans for public service retrenchment, but it is premature to dismiss it as exclusively concerned with expenditure cuts and privatisation. The Big Society signals the government's ambition to transform public services and it is the rubric that is being used to shrink the state and undermine long‐standing systems of public service employment relations. This article considers the origins and meaning of the Big Society and then assesses its consequences for public service provision and the workforce. The Big Society is integrally connected to deficit reduction with the voluntary sector and an increased emphasis on volunteering promoted as a more user‐centred and cost‐effective way of delivering public services in tough times. For the workforce, more competition between diverse providers in conjunction with budget cuts is placing downward pressure on terms and conditions and encouraging employers to question the continuation of national pay determination in many parts of the public sector.     

Peer Effects in UK Adolescent Substance Use: Never Mind the Classmates?

This article estimates peer influences on the alcohol, tobacco and cannabis use of UK adolescents. We present evidence of large, positive and statistically significant peer effects in all three behaviours when classmates are taken as the reference group. We also find large, positive and statistically significant associations between own substance use and friends' substance use. When both reference groups are considered simultaneously, the influence of classmates either disappears or is much reduced, whereas the association between own and friends' behaviours does not change. The suggestion is that classmate behaviour is primarily relevant only inasmuch as it proxies for friends' behaviour.