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Globalisation and its impact on Workers and Trade Unions

Globalisation and its impact on Workers and Trade Unions. Aims of the session. To attempt to clarify the term globalisation Look at the forces behind globalisation Assess the contribution of multinationals to the globalisation process

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Globalisation and its impact on Workers and Trade Unions

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  1. Globalisation and its impact on Workers and Trade Unions

  2. Aims of the session • To attempt to clarify the term globalisation • Look at the forces behind globalisation • Assess the contribution of multinationals to the globalisation process • To examine the impact of multinationals’ sourcing strategies on labour and organised labour

  3. What is globalisation ? • In groups of 3 see if you can • define the term • Make of list of those factors which underpin globalisation

  4. The Pillars of Globalisation • The rise of MNCs • The collapse of the USSR and acceptance of China of market economics –now a truly global market • Rapid advances in transport and communications technology • Mobile international capital – caused by deregulated capital markets • Development of IFIs – international financial institutions (IMF, World Bank,WTO) • Emergence und current dominance of neo liberal economic thinking.

  5. Features of Economic Globalisation • The market rules • Privatisation of public services • Deregulation • Public sector cuts • Trade liberalisation • More competition • Export orientation • Flexibility

  6. Neo Liberal Orthodoxy • “If you free up the flow of private capital, goods and services across national borders then this will lead to raised levels of productivity, GDP growth, employment and real income.”

  7. Multinational Corporations • Now number some 63,000 parent companies with c. 700,000 foreign affiliates • Top 100 are exclusively based i.e. have their HQs in developed countries • Principal drivers of international production and the provision of services

  8. MNCs Merchandisers/retailers EU/USA Logistics Companies EU/USA Supply Chain Managers Asia and US Suppliers HQ in EU/USA but increasingly Asia

  9. Merchandisers/retailers/ Logistics Companies Suppliers (old) Suppliers (new)

  10. Multinationals in Textiles Clothing and Footwear Apparel merchandisers Retailers Apparel Manufacturers Suppliers Buying agents/supply chain managers Trading companies/import export firms

  11. The Global Assembly line • Garments designed in the USA - • manufactured under contract in China • by a company owned in Hong Kong • raw materials from all around the world. • transported to the UK in container ships carrying a flag of convenience and crewed by Filipino seafarers. • Payroll and other data tasks carried out in Asia

  12. The subcontracting chain…. “Shop-house” Supplier Sub-subcontractor Home workers First line subcontractors Home workers

  13. Denim dyed in Italy Thread from Northern Ireland Polyester Thread Fibre made in Japan Jeans assembled in Tunisia Zip made in Japan Brass rivets made in Italy from Namibian copper and Australian zinc Cotton from Benin

  14. Anatomy of a track shoe Design sent to Indonesia for manufacture

  15. Anatomy of a track shoe Supplier’s Costs 12% of which 2% are wage costs 5%Transport & Tax Retailer 50% Brand owner 33% 13.5% profit

  16. Anatomy of a Nike Children’s Sweatshirt 5 Steps 11 Steps 6 Steps Sent to the Dominican Republic for assembly Total time allowed 6.6 minutes

  17. Anatomy of a Nike Sweatshirt V167G6N • Hourly rate in the EPZ in the Dominican Republic 70 cents • worker earns 8 cents for each sweatshirt they sew • sweatshirt retails in the US for $22.99 • if Nike doubled the wage it would be still only 7/10ths of 1% of the retail price

  18. Daewoosa - Nike Contractor in American Samoa

  19. What are the implications for workers ? • Make a list of the main issues you are currently dealing with in relation to the effects of multinational activity in your sector on the workers.

  20. How has globalisation affected the trade unions in your sector/country ?

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