9 - The Power of Labour

Summary

This chapter considers the effect of market integration on organized labour in Europe. To the extent that workaway and competitive wage pressure have become a more important means for securing local labour market adjustments, they are bound to affect the relative power of labour. This chapter considers the impact of these changes on the power and influence of workers as a class, and how organized labour in Europe has responded to these changes.

As mentioned in Chapter 2, it is common to measure labour power along two dimensions: in terms of both structural and associational power. Most of this book has aimed to describe how changes in European markets have undermined the structural power of labour. In the preceding chapters, we have seen how many instruments have been removed from the policymakers’ toolbox, leaving national authorities with less capacity to manage their local labour markets. Member states have jettisoned their monetary and regulatory policies, and their fiscal policies have been severely constrained by the needs of a monetary union (Chapter 6). The resulting policy void has not been filled by a suitable common budget or social policy at the European level (Chapter 7). Finally, European factor flows (Chapter 8) have proven entirely inadequate for the job: capital flows tend to make things worse, not better, and the scope of labour flows across Europe is entirely insufficient (and for good reasons). The result of these changes can be seen in a significant decrease in the structural power of labour, as evident in high levels of unemployment, low wages, increased workaway, dwindling social service protections and other indicators.

These changes have also necessitated increased competition among European labour markets. While the motivation behind these reforms may not have been to undermine the power of labour, this has clearly been the effect. In the same way that unorganized labour bids against unionized labour to secure scarce job offers, workers in Europe are now locked in a competitive wage struggle, where each local labour market has an incentive to underbid the others in a race to the bottom. European policymakers explicitly advocate wage flexibility as the key to economic (competitive) survival and this tends to increase the vulnerability (and commodification) of European workers. As Clauwaert and Schomann (2012: 17) have suggested, the EU seems to see quality employment (and pay) as being incompatible with competitiveness.