The Defence Force vice-chief Rear Admiral Jack Steer was refreshingly honest about the effect of cost-cutting redundancies.

As he told a parliamentary select committee last week, "our people felt we let them down, that we weren't looking after them, that we broke the social contract".

Who could blame them?

"Civilianisation" and "contracting out" were the c-words that were supposed to save the $355 million the Key Government expected by 2014-15. As uniformed staff with benefits were more costly than civilian staff, around 300 of them were made redundant, and about a third were rehired as cheaper civilians, while others became contractors or just surplus to requirements.

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Predictably, this had a destabilising and "traumatic" effect, Steer said. Morale sank to an all-time low. Such was the uncertainty and insecurity that a further 300-plus took themselves and their highly trained skills elsewhere.

Strangely, people trained for the possibility of putting life and limb on the line for their country tend to expect some loyalty in return, and seemed to feel betrayed at being treated as disposable commodities.

Indeed, Steer sounded regretful and concerned, as if he were talking about the break-up of a family.

Quite a different note was struck by Ports of Auckland bosses when they announced that about 300 port workers would be made redundant and their jobs contracted out.

It was clear they were following a careful strategy, that every legal box had been ticked.

It's no secret that the port company has been envious of Tauranga's contracted and apparently more productive workforce.

Now that the bothersome Maritime Union and its overpaid workers are out of the way, there are no longer any obstacles to the increased productivity, and higher dividends that we, the owners of Ports of Auckland, are demanding.

So, should I as an Auckland ratepayer be rejoicing at this victory?

The notion of a social contract between employers and workers seems almost quaint these days.

That Ports of Auckland's workers should have baulked at giving up hard-won terms and conditions for the uncertainties of contract work under three competing stevedoring companies has seemed unbelievably precious to many.

Decent wages and job security, it seems, are luxuries blue-collar workers in particular shouldn't expect. As one online Herald reader wrote, to the approval of 306 others: "Anyone who has a job in this economy should be thankful."

Len Brown wants to build a more equal, more liveable city, but the port company's victory puts another nail in that ideal.

If Ports of Auckland has succeeded in breaking the union and destroying one of the last well-paid blue-collar jobs, it hasn't done this city any favours.

There are many reasons to regret the lack of well-paying blue-collar jobs. According to the evidence, good jobs are essential for healthy and happy families (the kind the port workers appear to have).

The growth of "casualisation" - part-time, casual, temporary and contract work - though a global phenomenon isn't one we should be approving, let alone applauding.

A 2008 Labour Department report notes that businesses like casualisation - "non-standard and precarious employment" - because it increases flexibility, and means they have "less responsibility for the welfare of their employees".

But it noted that women, young people and older people, and particularly Maori and Pacific workers, were more likely to be in casual work.

And that casualisation "can negatively affect job security and has certain flow-on effects that influence other aspects of social life, such as the capacity to purchase property, engage in further education, support superannuation, or afford private health insurance. Casualisation may be linked to under-employment".

What's the big deal?

Lots of people work on contracts; I'm one of them.

But there's a big difference between port workers forced to take what's on offer from a contractor who needs to be both competitive and profitable, and contractors like me for whom the trade-off is a choice. I don't get paid sick leave or statutory holidays, but the flexibility and freedom makes it worth my while.

As the Australian Institute of Employment Rights in a submission to an inquiry on insecure work puts it: "One of the core founding principles of the [International Labour Organisation] is that 'labour is not a commodity'."

Anyone celebrating the defeat of the Maritime Union ought to take note, too, of the OECD's view that "high union density and bargaining coverage, and the centralisation/co-ordination of wage bargaining tend to go hand-in-hand with lower overall wage inequality".

That's right. The healthier the unions, the less wage inequality.

US research has also found that while union membership increased wages for all income levels, it was particularly important for low-waged workers, for whom union membership meant an increase in wages of as much as 20.6 per cent compared with non-union workers.