What are the forces actively shaping and reshaping employment in the modern world? Between a rock and a hard place – the shaping of employment in a global economy — volume four in the series “Work Organisation, Labour and Globalisation” (edited Ursula Huws, OUP 2010) — sets out to answer this question. Richard Leitch takes a look at the result.
We are used to thinking in terms of the struggle between capital and labour for mastery over the labour process, rates of pay and labour conditions etc. ‘Between a rock and a hard place’ situates this struggle within the new realities of globalisation, financialised capitalism and the fragmentation of labour. It also recognises the role other social and cultural trends play (eg age structures, gender relations, welfare regimes).
Adopting a resolutely multicausal approach, this collection shows that employment relations are shaped by ‘ a connecting mesh of social, political and economic forces, many of them with deep historical roots’ (p2). Though much has been claimed for the power of global capital to remake the world in its own image, the resilience of national factors that regulate employment (the policies of the nation state, trade union collective agreements) is evident in these contributions, which are taken in the most part from two major EU research projects.
As Ursula Huws points out in her introduction, such a shaping by organised labour has been vital to protect workforces everywhere from the contemporary threats of deregulation, outsourcing and co. The patterns and institutional arrangements laid down by past struggles force footloose TNCs and their governmental suitors to take these into account when making their investment decisions. They can also be effective campaigning tools for unions to press governments on.
No doubt, as we all recognise, the last three decades have found organised labour on the backfoot in terms of its ability to shape employment overall. But it is still active, and has begun to make some headway in this new terrain.
The imperatives and contours of global economic restructuring are familiar to us by now. Originating in the manufacturing and clothing sectors, this restructuring has spread through the ‘service worlds’ of IT, customer service and leisure, and on into the hitherto calm waters of the public sector (as previous issues in the series have documented). By design, this corporate restructuring aims to reduce costs and improve competitiveness through a combination of production reorganisation and increased labour flexibility. Outsourcing of certain business functions, often spanning national borders (‘offshoring’) is the favoured means here, shifting risks and costs onto new suppliers who, in turn, bear down on their workforces to meet these demands.
The most common result of this is a divergence of labour standards between segmented workforces, including the famous core – periphery division. New organising challenges for trade unions on peripheral sites inevitably follow – for many of these corporate moves are taken deliberately to avoid existing collective bargaining agreements, and tap new veins of cheap labour. Non – standard forms of employment can easily spring up in these so – called ‘global value chains’, adding to the fragmentation unions have to confront.
A classic example is described in Marku Sippola’s discussion of the Nordic garment industry, where production has been moved to low cost sites in the post-Soviet Baltic states. Only marketing and design functions have been retained at home. Not surprisingly, labour conditions in the Baltic factories are poor, and unions are struggling to make headway. (By way of contrast, labour standards and union autonomy are still protected in Nordic workplaces in general).
The automobile industry, no less subject to global restructuring, shows a different dynamic. A concentrated push by the employers for greater labour flexibility, in terms of new working time arrangements and the use of temporary workers, has taken place here within the home territories, rather than any geographical separation of production from development. On top of this a ‘modularisation’ of manufacturing operations has allowed work to be moved easily between different locations, exerting significant competitive pressures upon given workforces. There are therefore significant sectoral diferences at work here. Beyond that national variations are evident in the auto sector itself. Where industrial relations systems are still strong, labour has had some support to shield it from the cost-cutting regimes of TNCs (especially in Germany); other states lacking these institutional arrangements have found their auto sectors at the mercy of competitive pressures and a lowering of labour standards (eg. Hungary).
As previous issues of WOLG have also demonstrated, there is no single prescribed shape to, or result of, global restructuring processes.
The nature of employment in the service sector is considered by many of the contributors to ‘Between a rock and a hard place’. (Questions of whether these are actually services at all, or part of expanded production networks in the modern economy, are not our concern here). The IT sector, once an emblem of the new creative economy, has itself witnessed a ‘globalisation of intellectual labour’ over the last decade. This has increased competitive pressures upon its workforce as the familiar trends of concentration, outsourcing and offshoring take hold. In the EU region these dynamics have played out in various ways, refracted through distinctive employment models, industrial relations systems and training regimes.
Boes and Kampf consider the consequences of this process in the German IT industry. As standardised labour processes, direct forms of managerial control and their potential replaceability by skilled foreign labour displace the old secure, creative and collaborative work routines, IT workers are pitched into a new state of alienation and insecurity. The consequences of this ‘cultural break’ are as yet unclear, with a variety of responses evident. Any potential ‘proletarianisation’, assuming the identity of workers with interests opposed to that of management, depends heavily on the ability of trade unions to attract these IT workers by demonstrating their capacity to extract substantial gains from TNCs, according to the authors.
Elsewhere, in the less skilled regions of the service economy, the hotel industry illustrates two other key trends in the contemporary restructuring of employment. One is the impact of the ‘financialisation of capitalism’ – the transformation of productive investment along stock market short-term lines, that unleashes extra pressures to generate instant profitability through sweating assets. This reinforces existing industry trends of subcontracting and labour flexibilisation, bearing down on labour costs and locking the sector into low wage employment. The other is its dependence upon immigrant labour, a vulnerable and easily disposable reserve army of cheap labour, willing to endure low pay, poor conditions and non – standard employment patterns.
None of these features make union organising and the creation of some protection for these workers easy, as reflected in the low levels of union density across the sector as a whole.
The consequences for labour of all these changes are stark. Jorg Flecker argues economic restructuring is undermining old homogeneous labour patterns and constituencies, producing a number of types of labour fragmentation. The segmented workforces arising out of outsourcing and offshoring strategies are familiar enough. Flecker identifies two more – triangular employment relations, where outsourced business functions remain located in the original workplace (especially connected to IT provision), so people are working side by side for different employers; and multiple forms of employment, with different contractual arrangements introduced by a single employer (notably in privatised parts of public services).
All of these trends throw up significant challenges for workers, in terms of their impact upon pay and conditions; the resulting heterogeneity is no less daunting for unions trying to organise these fragments.
In terms of what is happening to working life within these changing patterns, Bettina-Johanna Krings and her colleagues provide a panoramic survey of economic sectors across the EU, centred on the notions of working time and work – life balance. They argue that in general workers are facing a ‘ loss of time sovereignity’ within employment and beyond it, encroaching on their work – life balance. The historic trend towards reducing working hours has gone into reverse in recent decades, and intensification of work has become a common theme of worker’s complaints. Alongside fragmented working patterns, working times are becoming similarly diverse and individualised, as employers seek ever greater labour flexibility. Female labour is particularly hard hit by these changes, having to balance its enduring responsibility for domestic labour against increased employer demands. In general, non-working life and activity is finding itself increasingly squeezed by ‘market requirements’.
As the authors point out, these trends and dynamics do vary according to economic sector and national factors. In manufacturing, flexible working patterns (shiftwork, overtime, temporal flexibility schemes) are eroding individual autonomy outside the workplace, leaving women workers (with their ‘double burden’) especially vulnerable. Where traditional extended family networks remain strong (in Southern Europe) there has been some degree of protection to cushion the changes – unlike the Northern EU states. The IT sector has different dynamics – global restructuring requires collaboration with overseas colleagues and clients (‘a synchronisation of working time’) and extra business travel, drastically reordering working patterns. Again women find themselves in difficulties here, tied to fixed family schedules that interrupt their career prospects. And again, there is a further distinction between EU states that have introduced supports for the work – family nexus (the Nordic societies) and those lacking them.
So much for the causes and consequences of today’s employment patterns. What about the responses of organised labour? Though not the main theme of this collection, several contributors do consider how unions have been dealing with these massive changes. Overall it is clear that labour has been on the defensive: outmanouevred by production relocation, deregulation and a fracturing of labour patterns it has been unable to reverse. Having said that there have been some efforts to stabilise the situation.
Most unexpected has been the expansion of unions into previously non-unionised companies – as the likes of IBM and other IT giants expand into public sector contracts and take over already unionised workforces. Elsewhere new topics are being introduced into collective bargaining agreements by unions dealing with global restructuring, in particular over working time arrangements. These are however mostly concerned with issues of flexibility rather than achieving any reduction in overall working time. Krings et al fear this as a sign of union weakness – an attempt to trade increased labour flexibility for security of employment.
Finally, efforts are underway to forge a transnational labour response to economic restructuring through the mechanism of European Works Councils, found at company level in the auto industry. Their success in achieving minimum labour standards and coordinated negotiations as a bulwark against capital is, however, debatable. All of which could be summed up as the start of a union fightback in a changed and changing differentiated landscape. There is undoubtedly a long road ahead of us….