TRADE UNIONS HINDER CHANGE (PART II)

Workers in a sugarfactory in the Dominican Republic (1980)

This is the second part of an interview with the Dutch sociologist Jelle Visser. He is an expert in the field of labor relations. From 2000 to 2010 he was the scientific director of the Amsterdam Institute for Advanced Labour Studies, a part of the University of Amsterdam. Visser is the founder of the institute. His views on labor relations today are a little bit provocative but nonetheless interesting for trade unionists.

Why vanishes the middle of the labor market?

 Many routine work is automated or outsourced because it can be done  cheaper elsewhere, such as low-wage countries. For example call centers. In the industry there are many such jobs: men with a secondary education who routinely operate machinery. The characteristic of high and low paid jobs is that they are not routine. You can not outsource them.

Is this bad?

We risk that our Dutch labor market will become like the Spanish labor market. There’s one third of them flex workers. If we don’t do nothing to change our heavy laws on dismissal the group of flex workers will grow and because of the erosion of the middle this is not so desirable. All major social conflicts of the past fifteen years are about the same issue: the motivation and compensation of employees during the second half of their career. The disagreement was about the early retirement, law on dismissal and retirement age and payment. The trade unions should put these items on the agenda. How can we improve the position of older workers and at the same time reduce the protection of this group? As long as we continue to avoid those questions, the  generation gap will grow.

Can governments still regulate the labor market?

Governments have only very limited control. It can establish a minimum wage and prohibit that work is being done below the minimum wage. But the government can not do much to control Eastern European self-employed who work for a few euros per hour. The market has become more elusive though it was only because of the cheap workers in Eastern Europe and China. The joke is that the government has resigned since the eighties but at the same time started to regulate more. Take for example parental leave or working part time or what employers may ask during interviews.

You say that the euro-crisis has been caused also by the labor market?

Indeed, the labor market relations play an important role in the euro-crisis. Without reforming the labor market South-Europe can not become competitive: less rules, less protection against dismissal. The differences between European countries in competitiveness started when Germany in 2003 made its labor market more flexible. The German trade unions exchanged more work for lower wages. IG Metal, the biggest trade union of Europe, borrowed that trick from the Dutch trade unions. These reforms reduced the cost per unit product in a way no other country could keep up with. While ten years ago Germany was still the sick man of Europe: high unemployment and hardly innovative. The question now is if prime minister Mario Monti can make such kind of deals with the Italian employers and trade unions? He must cut privileges of for example lawyers and notaries who have too much power.

The first part of the interview you will find in my previous blog

The interview with Jelle Visser has been published in the Dutch paper NRC Handelsblad, 22-11-2011