4 - Trends in Collective Bargaining, Wage Stagnation and Income Inequality under Austerity
Published online by Cambridge University Press: 18 March 2021
Summary
Introduction
The purpose of this chapter is to explore the impact of the Global Financial Crisis (GFC) and austerity on collective bargaining and wage outcomes internationally. It takes as the starting point for its analysis the argument advanced in Chapter 1 that the current wave of austerity policies stems from a neoliberal economic consensus that has pervaded developed economies and emphasizes free markets, the removal of rigidities to capital and shrinking the state. That is a philosophy that in policy terms is the antithesis of one supportive of trade unions and collective bargaining, which are themselves under this ideology seen as impediments to markets and economic growth (Harvey, 2007). The chapter therefore adopts a perspective that sees the GFC and austerity as providing a convenient point from which to further consolidate neoliberalism's hold on society (McCann, 2013) and simultaneously undermine one of the chief forms of resistance – trade unions and collective bargaining.
The first part of the chapter focuses attention on exploring trends in collective bargaining in the EU and North America (US and Canada) in the post-GFC period. In doing so, it identifies a common trajectory in nation-state policies that encompasses a shift towards identifying the GFC as a public debt crisis; the blaming of trade unions and their members (in particular public sector workers) for the crisis; and the introduction of reforms to collective bargaining and union security designed to reinforce deflationary austerity policies. The chapter's second part then examines trends in wage growth and equality since 2008 and discusses the factors influencing them and the extent to which they can be viewed as a product of the neoliberal-informed economic policies and reforms adopted in response to the crisis.
Changes to collective bargaining in the EU
Institutional context of collective bargaining in the EU under austerity
Since 2000 there have been significant social, economic and political policy shifts that have fundamentally challenged the status of collective bargaining in the EU. Policies associated with a neoliberal agenda that view unions and collective bargaining as sources of rigidities in the market have been central to this change as the EU has focused on the neoliberal free market agenda of labour-market flexibility and downward pressure on terms and conditions to sustain economic growth (Waddington, Muller and Vandaele, 2019). This process of change received support from EU enlargement and the move towards economic and monetary union (EMU).
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- Working in the Context of AusterityChallenges and Struggles, pp. 71 - 96Publisher: Bristol University PressPrint publication year: 2020