ABSTRACT
A labour problem’ was first identified in the late 1870s when a growing awareness of unemployment and poverty combined with an increasing number of strikes aroused within government circles a fear of social instability and economic retardation. The main objectives of this new labour policy were greater consultation with and the better organization of industry. The creation of the Ministry of Labour was a token of government’s greater willingness to consult organized labour, whilst the summoning of the National Industrial Conference (1919–21) and the establishment of the International Labour Organization in 1919 were serious attempts to construct industrial consensus. Consistent with the prewar critique of the ‘labour problem’, both classical economists and industralists condemned the ministry’s twin responsibilities of conciliation and unemployment benefit for high wages, and thus the high industrial costs, which they identified as the main cause of mass unemployment.
