Globalisation And Poor Work And Flexible Labour Practices Economics Essay

Globalisation And Poor Work And Flexible Labour Practices Economics Essay Globalization is on every bodys lips; a fad word fast turning into a shibboleth, a magic incantation, a pass-key meant to unlock the gates to all present and future mysteries. For some globalization is what we are bound to do if we wish to be happy; for others globalization is the cause of our unhappiness. (Bauman, 1998) There are lots of mists attached to globalization which unveil the consequences to the human condition. It is difficult to measure the impact of globalization on the whole society so the focus of this essay will unveil if poor work practices and flexible labour practices are result of globalization or not. I will be talking about it in context to China, Bangladesh, Nigeria, and with the help of few case studies in relation to Europe. But it is important to emphasize the fact that globalization is not a new phenomenon; it existed earlier even in the form of exchange of goods across the nations. Globalization can be defined as the phenomenon to turn our world to a boun dary-less world. Giddens (1990:4) describe globalization as the intensification of world-wide social relations which link distant localities in such a way that local happening are shaped by events occurring many mile away and vice versa. (Debrah and Ian, 2002) An important aspect to look into while answering the question is whether globalization leading to unity/prosperity or it is taking us back to 18th century to the origin of sweatshop? Poor work can be defined with the example of sweatshop. Sweatshop is a work place and labour system in which labour faces long working hours, job insecurity, harsh working conditions, low wages, safety violation, inhumane treatment with employees and employees working in temporary illegal workplaces. All this come under the definition of poor work. Sweatshop is an extreme example of what economists call flexible specialized production. (www.answer.com) Flexible labour practice is a generic term for employment practices that is differentiated from the traditional norms in terms of the hours worked, length of contract, or the place of work. (www.bnet.com) Different type of flexibility are Functional Flexibility: skills Numerical Flexibility: amount Financial Flexibility: wage policies Temporal Flexibility: time Convergence to Poor work and Flexible Labour Practices Globalization leads to greater international competition, in order to compete, organisations need to be tuned into markets and need to be responsive to change. It is not only the globalization that affects the market so that it tends to change. Variety of opinions from various schools of thought exists over the rise in employment flexibility. The best examples could be the international oil crises of the 70s, rising unemployment rates in the 80s, the failure to use demand-side Keynesian politics to boom economic growth, the neo-liberal harsh strategies to cull unions, the re-surfacing of microeconomics models, the rise in female employment etc. (Standing, 1999 cited in Bernardi, 2001). Flexibility enabled producers to adjust supply to demand swiftly and reduced the risks involved in long-term investments. It also allowed them to expand to meet fresh demand and retract during downfalls. Producers tend avoid union rules and legal regulations and restrictions that fix wages, worker-benefits, and conditions by working in hidden shops and moving frequently. Sweated labor systems shift the social responsibility of production to society. They create a secondary labor market, through illegal immigrants because of globalization. In sweatshops young women and the undereducated people working in unskilled labour jobs. Somewhat same is happening in globalization: as many researchers blamed the exponential increase in the immigration on it. Poor work seems to be pretty prevalent in developing countries such as India, Bangladesh and china. In these nations the poor work seems to exist in multinationals and big manufacturers as well though there are laws which protect employees a nd international labour standards but outsourced factories hardly pay heeds to these standards. As in globalization it can be said the richer is becoming richer and the poorer is becoming poorer. The most famous example of use of child labour was in Nike factory production in China, which was exposed by the media to the world, which affected the brand image and affected the sales of the brand, because of using inhumane and child labour to produce the goods. After the Nike incident multinational companies have started to take measures in order to solve these issues. Now multinational companies are keeping a close eye on their outsourced production houses in developing countries. For example Apple has disclosed in its Supplier Responsibility 2009 Progress Report that some of its original equipment manufacturers in China were involved in bad labor practices. Apple said that of the 83 OEMs which make iPhones and iPods in China, 45 did not pay the workers for overtime and 23 paid their employees less than the local minimum salary standard. Apple stated that since 2007, Apple has been conducting inspections of the employee working conditions in its OEMs and is taking measures to im prove the work environment. (www.chinasourcingnews.com) this is where the role of international labour standard will help improve the working condition across the world. Various groups support the anti-sweatshop movement today. The National Labor Committee brought sweatshops into the mainstream media in the 1990s when it exposed the use of sweatshop and child labor to sue Kathie Lee Giffords Wal-Mart label. (www.chinasourcingnews.com) Vietnamese and Taiwanese managers are particularly known for their disciplinarian. (Chan A and Wang H.Z, 2004) The working conditions are harsh in all Taiwanese outsourced factories in different country. But it is noted from Chan and Wang 2004 study on Taiwanese management in China is harsher than it is in Vietnam. There are poor condition and more harsh disciplinary action taken when managing the Chinese employees. Globalization has lead to domestic migrant workers. By the end of 2006, there are 17 million migrants workers working in cities of which, 55% were in manufacturing, with an average monthly minimum wage of 500 Yuan ($70). (www.stats.gov.cn) the poor work exist in the form of long hours, safety/ health issues, child labour, physical punishment, delays in payments, giving poor living space for workers to live in and so on. (Chan, 2001) It is difficult to control the production process that is done in an outsourced factory in developing country. With the example of footwear industry in Europe, we can see how developed countries are trying to fight against deteriorating work and unemployment through flexibility. In Italy the footwear industry is outsourcing and subcontracting work in their local regions instead of overseas where the labour is cheaper. This is possible due to high unemployment in Europe. In EU unskilled labour seems to exist and paid low but not as low as in developing country. According to Paul Brenton et al (2006) a key feature of footwear industry in Italy has been increasing flexibility of production. And the reason of subcontracting to local region is the maintenance of stable and continuous linkages between shoe producers and subcontractors. According to Brenton et al (2006) unskilled labour, on the other hand, whose wages are generally low, often face considerable employment instability. In his study, he revealed that flexible production method help in the success of the foot wear industry in Italy. Brenton et al (2006) emphasis the fact that Italy alone in the whole EU was able to maintain domestic output and employment level in the footwear industry, otherwise there has been a shift of standard-labour intensive manufactured products from OECD countries to low-wage developing countries. Due to unemployment in the EU of the unskilled labour, footwear industry in Italy has benefitted because of it. As these unskilled workers willing to work for less due to unemployment, so globalization has a great impact not just on employment in developing countries but also on employment in developed countries in this case in EU. In order to eliminate these inhumane conditions, reformist movements focused on three pronged strategy: supporting labor unions, a very strict state sponsored check and balance system that better regulated the economy, and an informed consumer through national consumer movements. According to Blyton et al. globalization often poses serious threats to the local labor markets as deteriorating working conditions, the role of trade unions is minimized due to the impacts of the change in the global markets on local markets. It is often referred to the race to the bottom for employment conditions. (Debrah and Ian, 2002). This point can be explained by Heerge et als work on the response of the UK unions to the US inspired organizing model of trade unions, a response which has been patchy and limited to a few cash-rich unions which have adopted the membership campaign approach. British trade unions to overcome the obstacle to the adoption of the organizing model may have negative impact on membership growth and representational power in the battle to influence globalization and its impact on the employment experience of existing members. (Debrah and Ian, 2002) Castells (1996), he relation between globalisation and structural changes in the labour market is that the globalisation has made possible and encouraged an extensive restructuring of firms and organisations. In doing so, the globalisation process has also introduced a shift in the bargaining power between capital and labour, in favour of the first. With the rise in employment flexibility, i.e. the diffusion of fixed-term contracts, training contracts and semi-independent forms of employment, the impact of globalisation can be understood in two ways. (Debrah and Ian, 2002) The effect of globalisation on society can be summoned in two points: the increase in employment flexibility and increase in unskilled manufacturing employment. (Debrah and Ian, 2002). The employment flexibility has given rise to different type of flexible labour practices. Has lead to inequality, trade union oppositions and ethical considerations. Increase in unskilled employment has lead to the deteriorating work practices. There is still rise in the unskilled employment in developing countries, because labour is cheap and in country like Bangladesh, Pakistan, India and China need a source of income, in whatever way they can get. Why, then, do women workers endure these conditions with apparently little protest? And why those who claim to have the workers interests at heart resist the idea of using internationally enforced sanction to improve their labour standards? (Kabeer, 2004) The answers to these questions rest on the life of Bangladeshi women before taking the present jobs of working in garment industry in the era of globalization. In the study by Naila Kabeer (2004) on Bangladeshi women shows that they are satisfied with their work as it pays them well as compared to the previous standards. It is paying them wages on regular bases that boosts the self-confidence in them. It provides them the opportunity of socializing and gives them autonomy that wasnt existent previously. Along with all those it gives them some voice in decision making at home that was supposed to be the man domain previously. (Nazli Kibria 1995; Zohir and Paul-Majumder 1996; Sajeeda Amin, Ian Diamond, Ruchira T. Naved, and Margaret N ewby 1998; Margaret Newby 1998; Kabeer 2004; Paul-Majumder and Begum 2000; Dannecker 2002; Kabeer and Mahmud, forthcoming cited in Kabeer, 2004) In sweatshop the work was done in illegal places, but now in the era of globalization the inhumane conditions still precede but now they done in the outsourced factories of Multinational Corporation. Some practices seem to be similar to the practices and conditions of the sweatshop in the developing countries in this boundaryless world. In Kabeers (2004) article one quote that speaks thousand words illustrate the helpless situation of women in developing country and how their situation is helping the big giant multinational corporation to manipulate situation to their advantage. It has lead to inequality, as the powers of multinational garment industry around the world are misusing their power to minimize the cost to utmost. The below situation doesnt speak for just the Bangladeshi women but it speaks for the entire working women of developing countries. My name is Fatema Akhter. I am a garment workerà ¢Ã¢â€š ¬Ã‚ ¦ As garment workers we live and work under difficult conditions but at least we are managing to earn a living. Now we have heard rumors that in the next two to four years, the garment industry may close down. What will happen to us? You perhaps all aware of the situation of women in Bangladesh- women have very few opportunities for employment. We are, however, slowly making some progress. Because of jobs in the garment industry, many Fatemas like me are able to work honorably. Garment is the only option for us. We beg you not to take away these jobs and our right to work with dignity. (Peoples Health Movement, 2002:41-2 cited in Kabeers, 2004) The increase in economic interdependence in capital and goods/services markets has enabled managers search for more flexibility in employment relationships to face international competition and adapt swiftly to tough markets (Treu 1992 cited in Bernardi, 2001). There seem to be a shift from manufacturing industry to more into services industry. Manufacturing / production industry is more on the flexible labour employment. However, that some form of flexible employment such as consultant contracts are also spreading into the service class. (Bernardi, 2001) Unemployment and the loss of jobs in developed countries are somewhat generally linked with globalization. The Reason is that multinational corporations are moving their factories to developing countries. Due to the increase change in technology has resulted in more job losses. Mostly in developing countries like Pakistan, Bangladeshi, China and India poor women are working. Flexible organizations today are experimenting with varying schedules of time called flexitime. (Sennett, 1998) Flexitime arose from a new influx of women into the world of work. Poor women have always worked in greater number than women of the bourgeoisie. (Sennett, 1998) In 1960, about 30 percent of American women were in the paid labour force and 70 percent were not; by 1990 nearly 60 percent were in paid labour force and only 40 percent were not. (Sennett, 1998) The women need more flexible working time so they can work part-time and be parent full-time. In France they have imposed collective reduction in working time to create more jobs to fight unemployment and at the same time helping creating a balance between work and family life for women who has families. (Fagnani and Letablier, 2004). They work in harsh working condition to earn wages for their family living. Common to almost all OECD countries Turkey being the only exception is that part-timers are mainly women. Womens share in part-time work is the largest in Luxembourg (88%), Belgium (87.4%), the United Kingdom (86%) and Austria (84.2%). (OECD, Employment Outlook 1997.) Flexible contracts help maintain balance between work and family life. A very good example is of female UK part-time workers, they reported higher levels job satisfaction than full-time counterpart. (Booth and Van Ours, 2008 cited in Green et.al 2008) Same case is reported between Australian female part-time counterparts, they reported high degree of job satisfaction as well, showing that globalization has facilitated the female working class with lots of financial as well as non-financial benefits. In Australia some workers are working over 60 hours per week which is the second highest among the developed countries. (ACTU, 2001 cited in Green et.al, 2008) According to Booth et.al (2002) found that flexible contract workers were generally paid less, received less training and were less satisfied. (Green et.al, 2008) On the other hand permanent employees are given training and compensation benefit along with job security. Conclusion It can be said that for some globalization has been the cause of happiness and for others it has been the cause of discomfort. In case of the study on Bangladeshi women working in garment industry were happy and satisfied with their regular income. Globalization has become cause of unhappiness for many individuals and families because it leads to unemployment. Unemployment has given rise to flexible employment. Mostly women seem to be employed in flexible labour contracts. Flexible employment leads to job dissatisfaction and contain some elements of poor work which are low wages, long working hours, less union control. Globalization has lead to change in labour market conditions which has given rise to the flexible employment. The other important thing to look back into is that the poor working condition has been raised by the affects of globalization and free market mechanism but it isnt the only sole reason for these inhumane condition; other factors such as economics, competition, labour market conditions, unemployment and the standard of work already in developing countries has an impact as well. But the question arises as how to improve these working conditions, especially in countries like China and Bangladesh where there are really poor working conditions. International labour laws standards need to be placed in developing countries but in a friendly way, the forced imposition of it wont help to improve the standards. The help of developed countries will be needed in order for these laws to be placed in an effective way. Word Count: 3,028