Employment Restructuring and Industrial Relations in Russia: Lessons for Other Transitional...
-
date post
20-Dec-2015 -
Category
Documents
-
view
226 -
download
4
Transcript of Employment Restructuring and Industrial Relations in Russia: Lessons for Other Transitional...
Employment Restructuring and Industrial Relations in Russia: Lessons
for Other Transitional Economies
Simon Clarke
Department of Sociology
University of Warwick
Orthodox model of transition
• First stage– Archaic state enterprises liquidated– Transitional unemployment– High levels of social tension
• Second stage– Job creation by new private enterprises– Absorption of unemployment– Social stabilisation
0
10
20
30
40
50
60
1992 1993 1994 1995 1996 1997 1998 1999
Percentage ofunprofitableenterprises
Percentage ofinsolvententerprises
Unemployed by reasons for unemployment
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1992 1993 1994 1995 1996 1997 1998 1999
Note that the vast majority of voluntary quitters go directly to another job. Redundancies account for less than 10% of separations.
Did not work
Other
Voluntaryredundancy
Compulsoryredundancy
What really happened?
• Very few bankruptcies
• Very few compulsory redundancies
• Low levels of unemployment
Low levels of unemployment
0
2
4
6
8
10
12
14
%
1992 1993 1994 1995 1996 1997 1998 1999
Registered and Survey Unemployment Rates
RegisteredUnemployment
Survey (ILO)Unemployment
Economic difficulties led to
• wages lagged behind prices
• non-payment of wages
• huge increase in wage inequality
Falling and unpaid wages
020406080
100120140
1991 1992 1993 1994 1995 1996 1997 1998 1999
Wage inequality has increased from Gini .24 in the soviet period to .48 since 1992. Average wage arrears of those in arrears in 1996-8 were about three months. In October 1999 41% earned less than the subsistence
minimum of $40 per month.
Real Wages (1990=100)
Real Wage Arrears (endyear, 1997=100)
Stimulated ‘exit’
0
5
10
15
20
25
30
%
1992 1993 1994 1995 1996 1997 1998 1999Large and medium enterprises in all sectors of the economy
Hires
Separations
Rather than ‘voice’Strikes and Unemployment Rate
-
100,0
200,0
300,0
400,0
500,0
600,0
700,0
800,0
янв.
91
янв.
92
янв.
93
янв.
94
янв.
95
янв.
96
янв.
97
янв.
98
янв.
99
янв.
00
Th
ou
san
d d
ays
0
2
4
6
8
10
12
14
16
Per
cen
t
ILO Unemployment Rate (12month moving average) RightAxis
Man-days lost in strikes (12month moving average) Left Axis
Why has this happened?• Labour hoarding
– workers trade employment stability for low wages• but workers have no power
• workers vote with their feet, so that
• wages inversely correlated with labour turnover
• Not hoarding but hiring• technical constraints
• economic instability
• social and political pressures
Management employment strategy
• ‘Preserve the (nucleus of the) labour collective’– ensure wages and work for core workers– lay-offs and short-time rather than redundancy– high wages condition for tight labour discipline– wage increases restricted by ability to pay– non-payment of wages rather than wage cuts– multi-tasking and intensification of labour to
maintain production
Employment & Labour Relations• Prosperous enterprises
– Relatively high wages– Tight labour discipline– Low labour turnover
• Declining enterprises– Low wages, lay-offs, short-time, non-payment– Loose labour discipline: drinking, theft– High labour turnover
Labour Market• High job-to-job transitions
– very high differentials between workplaces
• Unemployment– Current Rate 12%– Long-term unemployment 6%– Average duration 10 months
• Labour force participation has fallen 12%– mostly young and old– no gender differences
Industrial Relations• Fear of job loss
• Authoritarian management
• Very low levels of industrial conflict
• Loyal trade unions
• Individualised responses
• Individualised labour relations– bureaucratic and legal disputes procedures
Lessons• Unregulated (flexible) labour market
– allows enormous employment restructuring– avoids mass unemployment– at the cost of workers’ living standards and
working conditions– with Latin American levels of inequality
• Low wages/no wages– allow inefficient employers to survive– undercut incentives to investment/innovation