In exploring the factors that contributed to the rise and decline of industrial labour in Australia, this article argues that support for unionism initially emerged from a working class that was a product of the country's unusual economic history. In the twentieth century the implementation of systems of compulsory arbitration, devised to mediate industrial conflict, reinforced support for unionism. In 1948, however, support for unionism peaked and a long process of decline began as the working class constituency that had provided its social anchor disintegrated as a result of structural changes in the economy. The dismantling of arbitration after 1986 exacerbated this established pattern of decline, as did a growth in precarious employment and employer anti-union strategies.