ARE TRADE UNIONS OLD FASHIONED?

Strike picket at the gate of the Volkswagen plant in Brussels, November 2006. Volkswagen was planning to close the whole plant.

A few days ago I heard for the first time a TV interviewer ask president Marc Leemans of the Belgium trade union confederation ACV if the trade union was not what old-fashioned? Of course the President did not agree. The trade union represents the interests of the workers and he knows what this means. As he himself explained, he is from a workers family with seven children. His mother did not have an easy life. Those times must not come back, he said. The interests of workers are therefore in good hands with him. However, this was was not an answer to the question.

In the Netherlands, on the other hand, already some time the trade unions are accused of being old-fashioned. Not by everyone, of course, but still disturbingly often. In short, the criticism is that trade unions are against any change, that they are only interested to represent their members, mostly older workers with a permanent contract and that they have no interest in the problems of youth. Meanwhile, young people are unemployed or have a low paid job without a permanent contract, lower social benefits, have to work longer and probably will have a lower pension. A gap threatens to grow between the older workers and young people. The older generation thinks only of himself, that is the allegation. In stead of solidarity, there is a generational conflict growing.

Meeting of workers of Volkswagen in front of the plant in Brussels, november 2006

The trade unions do not agree with this. They see themselves as progressive, modern, solidary, useful and important for country and people. They still have the status of official national representatives of all workers in the nation. They are the social partners of employers and politics. Their social dialogue led to social peace and political stability, the basis on which the postwar welfare state was built. The welfare state as organized solidarity.

But there were changes, partly due to the success of the welfare state itself. As a result of the welfare state people live longer, this threatens to make pensions based on the pay-as-you-go system priceless. As a result of the on going globalization, traditional industries disappeared like mining, steel, shipbuilding, textile industry etc., precisely those industries on which the sociopolitical power and collectivist solidarity model of trade unionism was based. The demise of traditional smokestack industry was followed by new industries with a growing individualization. Higher and better educated workers, also the result of the welfare state, are less charmed of the collectivistic solidarity model. They want to have part time work, have personal responsibility, if possible they want to change jobs etc. In the meantime the labor market asks for more flexible working hours and contracts, outsourcing, self-employed (millions of self-employed enter the labor market ) followed by privatization, liberalization etc. Globalization brought much turmoil on the labor market.

One of the strikers at the Volkswagen plant in Brussels, november 2006

The trade unions are since then facing two big problems: loss of thousands of members and a rapidly changing labor market as a result of individualization, globalization, liberalization and privatization. You can then try to stop this but then chances are great that you are going to miss the economic link with the world market and before you know you are losing the revenues on which the welfare state is built. More distribution of wealth will probably ease the pain, but not more than that. Economies built only on distribution of wealth, at the end bring poverty. Cuba and North Korea are extreme examples of this phenomenon. Investments are needed, preferably in the private and public sectors. Investments that also create new jobs.

The public debate in the Netherlands in recent years resulted into reforms such as raising the retirement age (within a period of approximately 2 years the pension age will be raised until 67) , a tighter and shorter unemployment insurance more focused on piloting the unemployed into a new job than financial assistance, stricter supervision of social services, limited subsidies for job creation for the disabled and stricter monitoring of care. On top of this, Governments call for more responsibility for a job, own income, health care and so on.

Meeting of the strikers at the Volkswagen plant in Brussels, november 2006

Slowly but surely, the image of the worker in the Netherlands changes from victim into an individual that is responsable for its own life. The welfare state is still there to support the workers when things go wrong but not anymore to take care from the cradle to the grave. For many unions this is like swearing in church, but their traditional power base has been undermined.

No wonder the unions are busy with themselves, looking for an answer to the lost social and political influence. Mergers of trade unions from various sectors is the answer to the loss of members. For example already a few years, the Dutch trade union confederation FNV is reorganizing its structures to bring all unions together under one roof. This means more centralism to give more socio-political body to the social dialogue. But centralism is at odds with individualization. Workers want like consumers more customized services and less imposed collectivist schemes. The mergers are therefore only the beginning of a response to the crises.

Two workers at the trade union meeting of workers of Volkswagen, november 2006

To make matters worse the new century began with an economic disaster of a magnitude that has not been seen since the crisis in the twenties and thirties of the last century. The consequences are now widely reported, but the answer is not yet found. Economists are fighting among themselves about what to do but nobody really knows. Unions are trying to save from the burning socioeconomic house what can be saved with classical solutions for example more money from the Government for all kind of investments which means also making more debts.

The trade unions do not need to be ashamed that they have no ready answers and great difficulty with the reforms, but they may be more open to suggestions. It is not constructive if trade unions do not want to talk about proposals of employers to look for ways the millions of self-employed to integrate in the social security system. The trade unions should also start a dialogue about the possibility for retired workers to continue working after they have reached the age of pensioning. Trade unions that are putting their heels in the sand, give indeed the impression of being old-fashioned.

Man at the solidarity bus is writing a message that begins with "We are not alone"

NEW JOBS

Togo january 2005( photo PETRUS)

Because of the growing unemployment there is a lot of talking in Europe about creating new jobs, especially for young people. The unemployment rate for young people is in many countries much higher than the average unemployment rate. The ETUC wants the European states to invest more in the economy in stead to continue its austerity measures. However, the EU decided to fight the Eurocrisis by tightening the budget control of each nation state and to make the rules on deficits stricter, so it is very difficult to convince political leaders to change.

The proposals for spending more public money to put the economy in motion are on a rather general level. For what kind of economic activities the European nations should use the public money? What special activties should be sponsored by the state to employ more young workers?What would employers do with the help of public money in case they are subsidized by the state? Will they hire young workers or invest in new means of production?

Confederal Secretary General Guy Tordeur of the Belgium Christian Trade Union in Brussels gave some ideas for employment in his article 'Work on employment' (Visie, 11 january 23013). To his opinion employers and government together have a great responsability to look for solutions for youth unemployment. “This high unemployment rate among young people is nothing new. It exists already a long time. The problem is certainly not solved by removing the unemployed from the statistics or by reducing their unemployment benefit. Work should be done to create employment, not just work for higher-skilled workers, but also for workers with limited training. Everyone has the right to quality work.”

Tordeur believes that one of the possibilities to create employment in the next future will be in the healthcare sector. Due to the aging population in the coming years tens of thousands of jobs will be needed. “Only in Flanders a report by the Flemish government talks about the need for 60,000 additional workers by 2015. The same applies to the city of Brussels. Foreign workers are not the solution to the shortage of staff in the health sector. With appropriate education and training many job seekers, even with limited training, can be employed in the healthsector. The sector itself will have to provide good quality jobs, allowing employees to continue their work.”

Togo, january 2005 ( photo  PETRUS)

Tordeur believes that another new job possibility exists “by the transformation of our society into a society that takes into account the ecological capacity of our planet. This includes a 80 to 90% reduction of CO2 emissions by 2050. That is a big challenge, but it also offers opportunities for new jobs. I am thinking, for example: home insulation, construction of energy efficient homes, building solar panels, windmills, development of more public transport, waste processing and recycling .... In the coming years this trend towards more green sectors will continue.”

What I am missing in this debate is what shoul happen in the private sector that is still responsable for the vast majority of jobs in all EU countries. According to European statistics of 2006 nearly 70% of workers earns his money in the service sector, 25% in the industrial sector and less than 5% in the agricultural sector. Only a small proportion of the workforce is employed by the government as a public official, in the national education system, police or army.

It is therefore of utmost importance that the private sector creates new jobs so that more people are employed. But how to generate more jobs in the private sector? Should one use public money for this? Should the state itself stimulate more research with the idea to develop new technologies for production and services? Should be lowered tax rates on labor and taxes higher on capital? Must be diminished bureaucratic control, rules and regulations for private enterprises? Should the government invest in roads, canals, air and seaports?

Must there be made radical changes in the wage structure like has been done in Germany some years ago? What to do with the idea to lower the wages of senior wokers, to make it possible for companies to hire young workers? Must there be less protection by law against dismissal of workers as is proposed by employers? Is more flex working a solution for companies to answer faster and more efficient to the changes on the market? How should social protection be organized under such circumstances. Many questions and not yet enough answers but time is running out. For a society it is dangerous to leave aside too long the younger people.

UNIONS NEED TO REVITALIZE

Profesor Milan Katuninec spoke on the European Seminar of WOW in Vienne on the Social Dialogue in Central and Eastern Europe (EZA sponsored). We have already published on this blog two parts of his speech: "Why Unions lose power in Central and Eastern Europe" and "The rise of individualism". Below you find the third and the last part.

Besides the increasing individualism, the trade union movement has to contend with another big challenge. Trade unions can not ignore the „birth of nearly one hundred new types of power-scrutinizing institutions unknown to previous democracies.“ Democracy offers space for individual and social emancipation. This will cause constant tension between solidarity and freedom and there will always remain a countervailing power and collective labor agreement will always be needed. But the old rule of „one person, one vote, one representative“ is replaced by the new principle of monitory democracy, „one person, many interests,... multiple representatives“.

 Political scientist John Keane sees in modern information technologies an important stimulus to halt the declining public interest not only in political, but in fact in the whole social life of the home, as well as internationally.  The world has become increasingly diverse and this is the challenge for the trade unions. Effective public debate about freedom, justice, toleration and solidarity requires that employees, students as well as other citizens are well-informed. Trade unions, in the competition of various interests must take advantage of the new possibilities of information networks.

Social-economic factors will always play an important role in the political assessments of social partnership. Politics can only be understood in an economic and social context and all efforts to separate social and economic problems usually result in political problems. It requires a democratic society and socially-minded citizens who, in their own interest, are freely engaged in public and social interests and do not remain passive observers of social change.

But looking forward, the trade union movements should revitalize themselves by the use of greater internal reflection and by a responsible reaction to many new social challenges. The question is, whether their leaders will meet the hopes of the trade union members and whether employees will realize that the membership is very important for the authority and the bargaining power of the trade union? Or whether the trade union movement will continue suffer from undervaluing of external changes and weakening of social responsibility? Can trade unions save themselves or will their position deteriorate in the future and will they only remain as a decoration of public policy? 

           

I do not think that during the current economic and social crisis will the trade union movement in Central and Eastern Europe become more powerful. But despite the decline of trade union membership, we can not say that the idea of social justice in Central and Eastern Europe is unpopular. This leads me to believe that the trade unions, by taking into account new factors and challenges and making concrete proposals on strategies to improve social dialogue, will be more attractive and will have substantial opportunities for their active and responsible social policy.   

WHY UNIONS LOSE POWER IN CENTRAL AND EASTERN EUROPE

Profesor Milan Katuninec during his speech at the WOW seminar on the Social Dialogue in Europe

Profesor Milan Katuninec of the Slowakian Trnva Univeristy spoke on the WOW seminar on the social dialogue in Europe. We have the pleasure to publish here the first of three important partis of his speech that can be useful for trade unions elsewhere in the world.

"Despite different developments of trade unionism, we all agree that the trade union movement must be an important part of civil society. But from 1989 there has been a widespread decline in the trade union membership in all central and east European countries. Poland has a level of union density of less than 15%, Hungary 16,8%, Czech Republic and Slovakia 17%, Bulgaria about 20%, and only in Romania is the density with 33% above the EU average.There have been many attempts to explain this negative trend and I know that we have no time to deal with them in detail. I will mention briefly only some of them.

One reason for this is a large structural change in the industrial breakup of enterprises that have not been competitive in new market conditions, the privatization of enterprises and new companies with transnational capital. During the period of reckless privatization, there was a weakening of the position of the trade union movement in many enterprises, the basic social rights of employees were ignored, and the market economy was reflected in the uncompromising assertiveness of the unrestrained capitalism. Most of employees who remain today in the trade union organizations are working for former state-owned companies.  People, who have been sacked and have experienced unemployment, are less likely to join again a trade union after finding a new job, because they have lost trust in the trade union movement. 

In Central and Eastern Europe as well as in many west European countries where the unemployment grows, trade unions are losing their power. We can see in our countries a failure of active social policy, which emphasizes prevention of social problems by taking action „ex ante“.  There is a growing number of young people in Central and Eastern Europe without any work habits, without having to learn that nothing is free.

There are 35.6 % young people in Slovak Republic unemployment and many of them are loosing active interest in work. They are without personal responsibility and roam the streets. This people, without acceptation that the borrowed money should have to be paid back, are living on state support without any hope for better future. In an unhealthy environment the importance of future and the strategy focused on goals of serving the common good is often underestimated, and the attention goes to the negotiations for solving of accumulated problems.  In such an environment we can not wonder that the view of young people on the social policy is significantly different from the view of the older generation, for whom unemployment is a huge shock. But there also are different views among young people."

ILO: 600 MILLION JOBS NEEDED

As you can see in the picture, young people are very creative with little money to earn an income. (Veracruz, Mexico)

The ILO published its annual Report on Global Unemployment 2012. It is a report full of statistics nearly beyond our imagination. The ILO press release announcing the report starts with the conclusion that “the world faces the ‘urgent challenge’ of creating 600 million productive jobs over the next decade in order to generate sustainable growth and maintain social cohesion”.

400 million new jobs

The ILO report continues with such astronomical figures as “more than 400 million new jobs will be needed over the next decade to absorb the estimated 40 million growth of the labour force every year. In addition the report says that “the world faces the additional challenge of creating decent jobs for the estimated 900 million workers living with their families below the US$ 2 a day poverty line, mostly in developing countries.”

Youth unemployment

The report confirms the trend that youth aged between 15-24 are the most

affected by unemployment. An estimated 75 million young people are unemployed. Globally, young people are nearly three times as likely as adults to be unemployed.

Growing labour force

But not every outlook is just black. The report also concludes that “favourable economic conditions pushed job creation rates above labour force growth, thereby supporting domestic demand, in particular in larger emerging economies in Latin America and East Asia.”

This guy tries to earn an income with minimal investment by a diversion of a highway. (Mexico)

Labour productivity gap

Another positive sign is that “the labour productivity gap between the developed and the developing world  - an important indicator measuring the convergence of income levels across countries – has narrowed over the past two decades. But there is still a lot to do. Output per worker in the Developed economies and European region was US$ 72,900 in 2011 versus an average of US$ 13,600 in developing regions.

What should be done?

The ILO believes that the real job machine will be the private sector and therefore calls policy-makers to act “decisively and in coordinated fashion to reduce the fear and uncertainty that is hindering private investment.”

In a clear warning to be careful with measures to control the state debt crises, like is going on in the Eurozone, the report says “that in times of faltering demand further stimulus is important and this can be done in a way that does not put the sustainability of public finances at risk. The report calls for fiscal consolidation efforts to be carried out in a socially responsible manner, with growth and employment prospects as guiding principles.”

The balancing act of this artist can be seen as a metaphor for many people in developing countries balancing on the edge of poverty due to a shortage of well paid jobs.(Veracruz, Mexico)

It goes without saying that what will be a “socially responsible manner” , will be the subject of a political battle. Trade unions have to raise their voice in this political battle as to show that they are willing to contribute to a solution

You can find on the ILO site an animated infographic for the main findings of the report, a press release and a link for downloading the complete report in different languages.