Tipping points are often more difficult to identify as they occur than afterwards. But that hasn’t stopped people from wondering if there is lasting change in the job market. After 40 years in which capital has had the upper hand, is the power of the workers increasing?
If so, it will mark a profound economic reversal for much of the rich world. Since 1985, union membership has been reduced by half on average in the Organization for Economic Cooperation and Development (OECD) countries , while the coverage of collective agreements signed at the national, sectoral or company levels decreased by one third. At the same time, the workers take a smaller slice of the pie. The growth of the real average wage has not kept pace with the growth of productivity on average of the 24 countries of the organization during the last two decades.
But the pandemic precipitated a worker shortage in many countries that caught employers off guard. Migrants returned to their home countries, older people retired earlier, and health or childcare problems led others to leave the labor market.
Workers try to take advantage of its sudden scarcity value. In the United States , unionized workers launched a series of strikes, from John Deere to Kellogg . They also tried to organize in low-paid sectors with no history of union presence, from Starbucks to Amazon. In the UK, the proportion of employees affiliated with unions began to rise after decades of decline. They also find new ways to fight for what they want. Organize, a UK-based workers’ advocacy campaign platform, now has over a million members after rapid growth during the pandemic.
Policy makers in some countries are trying to help tip the balance. Joe Biden, president of the United States, promised to be “the most pro-union president ever seen” and wants to pass legislation that makes organizing easier. The European Commission published draft legislation that it says will end companies in the chambas economy that misclassify people as “self-employed” to avoid giving them rights and protections as workers.
Demographic factors, which are evolving little by little, can also contribute. Some economists believe that the global glut of workers in recent decades is about to end as population growth slows and the world’s share of working-age people begins to shrink. This can drive salary growth by making staff harder to find.
On the other hand, workers will see that their moment of advantage is fleeting. More jobs and tasks are likely to be susceptible to automation as both robotics and artificial intelligence improve. The rise of telecommuting and crowd platforms, which divide jobs into small tasks, may lead to a new wave of globalization affecting administrative staff in the industrialized world.
Regardless of whether the balance of power between capital and labor has changed forever, the pandemic has been instructive for both parties. Employers discovered that staff availability is not a fact, but rather a business risk that needs to be mitigated. Many pay more attention to hiring and retention, and not just in the professional world. And a new generation of workers, from people who replenish products on shelves to delivery men, have learned how essential they really are.