Industrial Reserve Army

The concept

The industrial reserve army is the relative surplus population that Marx treats in Chapter 25, Section 3 of Capital Volume I. He wrote that capitalist accumulation "constantly produces, and produces in the direct ratio of its own energy and extent, a relatively redundant population of labourers", a surplus relative to capital's needs for self-expansion rather than an absolute over-population. It "forms a disposable industrial reserve army, that belongs to capital quite as absolutely as if the latter had bred it at its own cost", a mass of human material always ready for exploitation independently of natural population increase.

The analytical core is wage regulation. Marx wrote that "the industrial reserve army, during the periods of stagnation and average prosperity, weighs down the active labour-army; during the periods of over-production and paroxysm, it holds its pretensions in check. Relative surplus population is therefore the pivot upon which the law of demand and supply of labour works." He also linked overwork and unemployment as mutually reinforcing: "the overwork of the employed part of the working class swells the ranks of the reserve, whilst conversely the greater pressure that the latter by its competition exerts on the former, forces these to submit to overwork".

History

Marx did not coin the term. Engels had already used it in The Condition of the Working Class in England (1845), and the idea circulated in the British labour movement by the 1830s. The first mention in Marx's own writing is in an unpublished manuscript of 1847 ("Big industry constantly requires a reserve army of unemployed workers for times of overproduction"), and in Part 1 of the Communist Manifesto (1848) workers appear "organised like soldiers" under "a perfect hierarchy of officers and sergeants".

The formulation comes in Chapter 25 of Capital Volume I (1867). Marx first shows that accumulation with an unchanged composition raises the demand for labour and wages, then argues that as productivity grows the technical composition changes and constant capital grows at the expense of variable capital, and concludes that this directly produces a relative surplus population. As capital becomes concentrated and centralised, part of the working population tends to become surplus to accumulation's needs. For Modern Industry he described the reserve as repeatedly formed, absorbed and re-formed, connected to "the decennial cycle of periods of average activity, production at high pressure, crisis and stagnation". He noted that "capital increases its supply of labour more quickly than its demand for labourers", so the reserve does not rest on natural population limits.

Marx did not tie the concept to a free market alone. Where adverse circumstances, as in the colonies, prevented the creation of an industrial reserve army and with it the working class's absolute dependence on capital, "capital rebels against the sacred law of supply and demand, and tries to check its inconvenient action by forcible means and State interference".

Reception has been contested. Some writers read Marx as predicting absolute immiseration of the whole class. Ernest Mandel and Roman Rosdolsky argued Marx had no such theory (at most a widening rich-poor gap), and a careful reading shows he said the pauperised part of the working class grows rather than the whole class becoming pauperised, the absolute general law being "modified in its working by many circumstances". Marx's phrase "grow worse" means the dialectical inversion of means of production into "means of domination and exploitation of the producers", that is a more inhuman, more exploited and more alienated condition, not primarily poverty.

The concept is still analysed at global scale, for example in John Bellamy Foster, Robert W. McChesney and R. Jamil Jonna, "The Global Reserve Army of Labor and the New Imperialism", Monthly Review 63(6), 2011. The ILO World of Work Report 2013 recorded 195.4 million officially unemployed in 2012, 5.9 per cent of the civilian labour force.

Examples

Marx's own British case material runs from 1846 to 1866. On the badly paid strata he cited an average age at death of 38 for the Manchester upper middle class against 17 for the labouring class, and 35 against 15 in Liverpool. In agriculture, after the insignificant wage rise of 1849 to 1859, farmers "introduced more machinery, and in a moment the labourers were redundant again"; with capital laid out "in a more productive form", demand for labour fell "not only relatively, but absolutely".

Marx separated the composition of the surplus population into the floating, latent and stagnant forms, treating pauperism as the lowest sediment. The floating form covers workers now repelled and now attracted in modern industry, including large numbers of boys discharged at maturity. The latent form is the agricultural population constantly on the point of passing into the urban proletariat. The stagnant form is extremely irregular employment combining a "maximum of working-time, and minimum of wages" in domestic industry. Capital also "progressively replaces skilled labourers by less skilled, mature labour power by immature, male by female, that of adults by that of young persons or children".

A documented East Asian case is the 1970 struggle of garment workers in the Seoul Peace Market. The tailors' cutter Chŏn T'ae-il (1948-1970) campaigned on the non-application of the Labour Standards Act and burned himself to death in front of the market on 13 November 1970; the Ch'ŏnggye Clothing Union was formed on 27 November 1970 in the aftermath, and labour disputes rose from 165 in 1970 to over 1,600 in 1971. Chŏn's own 1970 survey recorded apprentice "sida" girls at 1,800-3,000 won a month, sewing-machine operators at 7,000-25,000 won and cutters at 15,000-30,000 won; a 1983 Tonga Ilbo report described Peace Market workers averaging 14-15 hours a day in attic rooms about 1.5 m high. The organising demands were eight items: paid holidays, regular wage rises, an eight-hour day, regular health checks, menstrual leave, abolition of the attic dormitories, ventilation and support for forming a union. Dismissals from the same period are also documented: after a fellow woman worker contracted pneumonia in the harsh conditions and was forcibly dismissed, Chŏn helped her and was himself dismissed in summer 1966, a case of sick and discarded workers being expelled from the active army into the reserve.

Applications to the global South and to migration followed. Duggan, "Reserve Army of Labor and Migration" (Encyclopedia of Global Human Migration, 2013), uses the concept for migration analysis, and Paul Bairoch estimated in the mid-1980s that "total inactivity" reached 30-40 per cent of potential working man-hours in Latin America, Africa and Asia.

Related concepts

Within Marx's argument the reserve is tied to the organic composition of capital, variable capital and the demand for labour, credit and centralisation, the industrial cycle, and overwork competition among workers; he described the credit system as "an enormous social mechanism for the centralisation of capitals".

The link to organised labour is explicit. Marx discussed trade unions trying to organise employed and unemployed together "in order to destroy or to weaken the ruinous effects of this natural law of capitalistic production on their class", and recorded capital's outcry at any "combination of employed and unemployed" as an infringement of the law of supply and demand.

Contemporary adjacent concepts include the precariat, which in Marxist and anarchist theory describes reliance on temporary, part-time workers with precarious status who "share aspects of the proletariat and the reserve army of labor"; NAIRU, which holds that price stability requires a certain amount of unemployment; and hidden unemployment together with official measures (the US BLS U-1 through U-6 series, with U-3 as the "official" rate).

Distinctions

First, unemployment and the relative surplus population differ: the unemployed can be defined as those actually looking for work, while the relative surplus population also includes people unable to work.

Second, the supply of labour power is not the number of labourers. A variable capital of the same magnitude may set more labour in action without enlisting more labourers, through longer or more intensive exploitation, so the reserve's size cannot be read off from a headcount of the population; an increase in variable capital can be "an index of more labour, but not of more labourers employed".

Third, Marx's surplus population is not Malthus's overpopulation. Marx's is a social relation under capital; Malthus predicted population would exceed food supply. Marxists argue no real problem exists if food were produced and distributed differently.

Fourth, economist criticism should be recorded rather than dismissed. Paul Samuelson argued that the unemployed drive down wages only contingent on whether they are available replacements and on real-wage effects, and that the reserve army reduces wages only by shrinking as it is absorbed. Murray Rothbard similarly argued the reserve army would eliminate itself and be no lasting threat, while productivity-driven demand could reduce unemployment.

Fifth, whether unemployment is voluntary or involuntary is a live dispute, generally seen as involuntary when levels are high, as at 20-30 per cent in the 1930s Depression. Unemployment levels are partly political: governments can allow unemployment to rise or implement job-creating policies, and if unions are legally blocked average wages can be kept low even at low unemployment.