Brussels – Manpower shortages are bringing the labour market to its knees. However, workers can emerge advantaged by improving their bargaining power. This is shown in the studio conducted by the European Trade Union Institute – ETUI, the research and training centre of the European Trade Union Confederation (ETUC).
The study, titled “Labor Shortages, Labor Quality and Workers’ Bargaining Power,” proposed by Wouter Zwysen, senior researcher at ETUI and author of the report, offers a quantitative European analysis of these issues.
The analysis of labour needs to consider the economic conditions that have affected the EU in recent decades and the asymmetry in the effects on the various production sectors. Beginning with the recovery after the financial crisis of 2008-2010, labour began to decline, a factor exacerbated by increased demand and market changes.
The digital transition expressed its full potential during and after the pandemic, affirming hybrid work. The other side of the coin has been a worsening of working conditions, which, however, “also provide opportunities in terms of bargaining power,” offering a possible balance to the power imbalance to the detriment of workers.
As ETUI’s study reports, companies have wondered how to respond to this “labour flight”. “You can make jobs more attractive by increasing wages, training opportunities or telecommuting,” or you can set other hiring criteria to broaden the pool of applicants. Other options to address structural deficits involve increasing skills “through training, upgrading and retraining” and trying to attract more workers “mainly through increased mobility and migration.” Same line as the European Commission, which proposed identical cornerstones in European Commission Action Plan regarding labour and skills shortages.
The impacted sectors are various. Over the past decade, construction, hospitality, and administrative services are on the podium, less affected have been the real estate and financial services sectors. Even among the affected sectors, there are important differences in the solutions to be sought, which are not limited to hiring immigrant workers at rock-bottom wages or not investing in improving the quality of jobs.
“This new reality is creating unique opportunities for workers, especially those in historically precarious jobs, who now have greater bargaining power,” says Zwysen. Companies flounder, but workers are holding the cards. The news events prove it, such as the recent strike at Charleroi Airport, in which workers brought Belgian air transport to its knees in protest against the arduous working conditions.
Economic theory dictates that price rises with supply shortages. This is the case for wages, which increase in correspondence with growing labour shortages. In parallel, contracts and job security grow, according to the study, but with “slightly worse training and career prospects and work-life balance.”
For Zwysen, workers’ representation is a solution to these risks, especially with positive impacts on the most vulnerable groups, including young people, women, migrants, and those employed in sectors with less union presence.
The prospects and potential for improvement for the market are there. One must not lose sight of the long-term logic, in which union collective bargaining must be included, and the quality of work, which “is a much broader concept that goes beyond money,” as the ETUI study reminds us. Considering that digitization is posing additional challenges for balancing occupations and private life, workers can hope to benefit from the transition phase of the market by trying to protect themselves and demand appropriate conditions to carry out their profession.
English version by the Translation Service of Withub
