The Erosion of Union Power
Superficially, labor in the 1960s seemed a force second only to the military in power. Over 2 million workers, most of them skilled or semiskilled, belonged to unions. A majority were city born, streetwise, and felt a strong loyalty to Juan Perón, who continued to direct their political actions from exile. The unions they belonged to were relatively mature, having been formed a generation or two earlier, and had attained a considerable degree of experience in dealing with employers, government officials, and each other. They also were united by a comprehensive labor confederation, the CGT, which enhanced their ability to call general strikes.
Although unions usually were strong enough to fight back against austerity policies, essentially they were on the defensive. Bit by bit labor's share of the national income fell, from a high of 50.8 percent in 1954, under Perón, to only 35.9 percent in 1972.1 The unions did not accept this trend passively. As table 16.1 shows, the early years of this period following Perón's fall saw a record number of strikes.
Nevertheless, labor fought a losing battle. Although the population only grew by a very modest 1.6 percent annually, employment in manufacturing, transportation, and communications rose by an even lower 1.2 percent. Most of the jobs found by people entering the work force each year were in construction, commerce, or services. Many of those were poorly paid, part-time, or seasonal. This trend toward a labor-surplus economy was further accentuated by a relentless substitution of capital-intensive for labor-intensive methods in industry. Strikes might slow down the introduction of new technology here or there, but they also spurred on efforts by employers to find any means to reduce their dependence on hand labor. In some cases, employers actually welcomed strikes, because emptying the factory gave them a chance to install new machinery.
Two other things helped to undermine labor's political effectiveness: its fragmentation into warring factions, and corruption among