THE JURY IS OUT ON WHETHER A HEALTHY ECONOMY HELPS OR HINDERS UNIONS, WRITES ANDREW WEST.

THE headlines were not what the nation’s union leaders wanted to read.

“Unions take great leap backwards: membership plummets," screamed the Herald’s front page in mid-April, after the release of the latest figures from the Australian Bureau of Statistics.

The numbers certainly were sobering. Union membership was down 5 per cent in the year to August 2007, to an overall rate of just 19 per cent. Despite a two-year campaign against the Howard government’s Work Choices laws during which the unions raised their profile among voters with almost unprecedented success the movement shed 89,000 members.

The movement had 1.7 million members – half the 1990 figure.

So are unions irrelevant to the modern worker? The then workplace relations minister, Joe Hockey, said as much during the election campaign, arguing, with the apparent backing of ABS data, that workers were voting with their feet.

Labour market specialists are divided over whether the economy, booming until recently and still relatively healthy, helps or hinders union membership.

In the past, low unemployment has meant a growth in union numbers but this was in an era of bigger, more centralised workplaces, factories, foundries, waterfronts and workshops. Staff worked in teams and the notion of solidarity was more deeply felt.

But the strong economy of the past 15 years has made the new generation of workers more autonomous... and restless. If they felt harassed by the boss, obstructed for promotion or simply unfulfilled, they moved, especially if they worked in growth areas such as IT, mining and hospitality.

But an economic slowdown is also unlikely to spur membership growth, as workers who feel insecure in their jobs are not usually emboldened to join unions.

The Rudd Government is, at most, marginally more sympathetic to organised labour. In its recently passed transitional workplace relations bill, it outlawed the making of new Australian Workplace Agreements and limited some public-sector AWAs.

But the substantive legislation, now in the making, is the subject of heavy lobbying from unions keen to restore many of their pre-Howard rights and employers desperate to preserve as much of Work Choices as possible.

Employers appear to be winning, with the Government saying it will retain limits on union right-of-entry to workplaces and singling out employees on more than $100,000 as exempt from award-based pay deals. The policy also maintains tough limits on industrial action, quarantining it to bargaining periods and demanding secret ballots of the workforce before such action.

But employers appear to have stepped back from the confrontational approach of the Howard years. For example, in April, the chief of the Australian Chamber of Commerce and Industry, Peter Anderson, said: “Industry does not believe in a deunionisation agenda."

Far from celebrating the fall in membership, Anderson said it was a sign of a more mobile, autonomous workforce.

The traditional bastions of unionism are suffering the most. The bureau figures showed big falls in manufacturing (215,300 members down to 190,900); construction (132,200 down to 119,300); utilities, such as gas, power and water (40,700 down to 31,700), and retail (197,200 down to 170,800).

Membership in the mining sector ticked up slightly, 27,400 to 28,600, but the interesting gains for the unions came in white-collar industries. Education membership rose from 267,200 to 286,500,

while the categories of “professional, scientific and technical services’’ were up from 23,000 to 28,500 and “administration" up from 19,600 to 26,900.

While their increases come off a relatively low base, they suggest that in the new areas of the economy, unionism is not as unpopular as union officials fear or as some employers might hope.