The Yugoslav industrial working class grew exponentially after World War II, when the communist regime launched its drive for rapid industrialization. From 1947 to 1952, industrial employment grew by 75.2 percent as peasants left their farms for jobs in the cities. From 1954 to 1975, industrial jobs grew at an average annual rate of 4.3 percent, and the industrial working class grew from 1.1 million in 1947 to 6.3 million in 1985. In the mid-1980s, the social (state controlled) sector of the economy employed about 98 percent of the country's workers.
Several years after Yugoslavia's 1948 economic break with the Soviet Union, the government instituted a comprehensive economic reform that transformed state ownership of enterprises into "social ownership" and theoretically turned over control of the enterprises to the workers who labored in them (see Socialist Self-Management , ch. 3). Workers' self-management remained a sacrosanct tenet of the Yugoslav political culture for the next thirty-five years, until economic turmoil forced structural reform in 1989.
Under self-management, workers who were permanent employees in enterprises were virtually guaranteed a job for life. If a worker terminated employment with an enterprise, however, he or she almost always lost the possibility of finding another position within the social sector. Under the Associated Labor Act of 1976, each worker belonged to a basic organization of associated labor (BOAL) assigned according to his or her precise role in the production process. The BOALs elected workers' councils, which in turn appointed executive bodies to set wages and production goals and recommend investment policy. The executive body appointed a director or board responsible for dayto -day operation of the enterprise.
Despite the profoundly egalitarian ideology on which it was based, practical operation of self-management reflected the stratification of the industrial work force. Skilled and educated workers occupied a disproportionately large number of seats on workers' councils. From the mid-1950s to the mid-1970s, skilled workers (roughly a third of enterprise employees) regularly won half the workers' council slots; the percentage of semiskilled or unskilled workers declined during the same period. Workers' council presidents also came disproportionately from the ranks of skilled workers or white-collar employees. Workers with advanced educational degrees accounted for nearly two-thirds of all workers' council presidents. The composition of executive bodies reflected the same trend.
The enterprise director and the director's staff wielded considerable influence. Access to and control of information about business conditions and overall operation of the enterprise gave the director an advantage in steering workers' council decision making. Workers exercised more influence on policies directly affecting working conditions and wages; over the years, they left investment and production decisions and daily operation of the enterprise to the director.
Self-managed enterprises responded to market conditions differently than firms in capitalist countries, and the relationship of the interests of management and skilled and unskilled workers also differed. Policies geared toward enhancing the enterprise's efficiency and competitiveness conflicted with socially guaranteed higher wages and job security for workers. Economic downturns generally caused reductions in investment rather than layoffs or reduced wages. An enterprise could reduce its labor force only with the workers' consent. This normally meant long, tedious legal procedures and finding alternative employment or job training to prevent workers from becoming unemployed.
The economic restructuring that followed the turmoil of the 1980s radically changed the fortunes of the working class. Strikes reached epidemic proportions by the end of the decade. Large numbers of workers returned their membership cards in the League of Communists of Yugoslavia ( LCY--see Glossary), and by 1985 party membership included only one of eleven semiskilled workers and one of five skilled workers (see League of Communists of Yugoslavia , ch. 4).
Lacking organizational autonomy, the official trade unions failed to protect the workers' living standards, and workers generally regarded the unions as irrelevant (see Trade Unions , ch. 4). In the late 1980s, unofficial unions began forming in Slovenia and the other republics after the government lifted restrictions on forming independent organizations.
Laws restricting private business ownership became increasingly ineffectual in the late 1980s. Most often ignored were tax statutes and restrictions on the number of workers employed in private enterprise. Workers outside the social sector frequently worked sixty or more hours per week and earned much better wages than those paid for the same work in the social sector. Private employers often employed skilled workers illegally, especially after the normal closing hour of socially owned enterprises (3:00 P.M.), and many workers employed in the social sector moonlighted in their free time.
In the 1980s, unemployment became a serious threat to the Yugoslav working class. Between 1965 and 1985, the number of officially unemployed persons rose from 237,000 to 1,039,000. Unemployment rates varied widely among regions. Slovenia consistently had the lowest, Kosovo by far the highest unemployment. The comprehensive economic reform of December 1989 led to elimination of redundant workers in Yugoslav firms and brought another steep increase in national unemployment (see Unemployment and Living Standards , ch. 3). In the initial aftermath of the reform, government planners relied on expansion in the private sector to re-employ workers who lost their jobs. In the first year, however, unemployment continued to rise.
Data as of December 1990