Systemic competition between high and low ‘social cost’ labour: a case study of the UK construction industry

There has been much recent debate within the EU concerning both levels and differentials of the ?social costs? of labour (EC 1994, 1995a, b; Edling 1992; Tarling and Wilkinson 1996: 23). This debate has been stimulated by two primary concerns: the requirement to meet convergence criteria for the single European currency under the Maastricht Treaty limiting the budgetary deficit levels, of which social protection constitutes an important element; and the level of structural unemployment and social exclusion attributed in part to global competition with economies characterised by much lower levels of? social costs?. An assumption running through such debate, therefore, is that high? social costs? are linked to high labour costs, deemed excessive either in relation to existing funding arrangements or in relation to competitiveness in global labour markets.