New Spatialities and Labour – Process, Structure and Upgrading Dev Nathan Meenu Tewari K. V. Ramaswamy

Why new spatialities? 1.Production conditions – Modularization of production tasks – Formalization / digitization of instructions linking segments – tacit into coded knowledge – Low transport costs – Lead to possibility of splintering of production across firms

Why new spatialities? 1.Changes in production conditions / technology 2.Segmentation of labour market – differing wage rates across countries 3.Opening up of markets – exports and imports 4.Changes in business models – JIT production – Retain core competence business, and outsource everything else – Global Delivery model for off-shore services

International production networks 1.Firms linked as branches – MNCs 2.Arms-length purchase from market, e.g. raw materials 3.Contracted supply by other firms, e.g. electronic components – GVC / GPN

GVC - GPN Out-SourceIn- House On-site D Local out-sourcing of services A Firm’s own production Off-site (off-shore) C Suppliers / GVC - GPN B Branch / FDI

GVC and FDI A GVC is not [A] and [B] – the traditional FDI route of expansion of MNCs Like an MNC, a GVC needs to have at least two disintegrated production segments But with at least two different firms, linked not by ownership but by contracted production relations [A] as Design and marketing combined with [C] as manufacturing In the case of [A] and [D] then it would become a National Value Chain (NVC)

Production Results China / Asia as manufacturing hub India /Asia as hub for offshore services Does this new spatiality of production affect income distribution within a chain?

GVC – GPN Distribution of Tasks with Profits and Wages Competitive Profits (P1) Monopoly Profits (P2) Wages above Market Rates (W2) D Monopoly lost, legacy wages P 1, W 2 A Monopoly: Design and marketing, high wages P 2, W 2 Wages at Market Rates (W1) C Cut-make-trim, Lewis-type wages P 1, W 1 B Full package supply, legacy low wages P 2, W 1

Distribution implications of GVC/GPN production – Concentration of monopoly profits[P2] in design, marketing and coordination segments [technology, marketing and management segments of final product] – Some share of monopoly profits can be shared with firm labour [W2] – Commodified tasks [manufacturing] earn only normal profits [P1]

GVC Distribution – This is an extreme or pure model of GVC/GPN production – But GVC production is not through market transactions – Rather contracts, which could modify market-results, depending on bargaining power – Contracted outcomes would lie between monopolistic and competitive outcomes

New spatialities and labour Does this changed distribution of work affect Labour processes Labour force structures in the different segments Sources of upward mobility for workers

New Spatialities Impacts on Labour (Adapted from Haws,2010) Out-sourceIn - house On-site D External supplier working on site ‘Body shopping’ A Multi-skilling Flexible specialization Responsible autonomy Off-shore C Global supplier Via intermediary SMEs Direct control Home-work B Own workers on customers’ premises

New Spatialities and Labour Marx recognized contradiction between the need to cheapen labour (deskilling) and the need for multiskilled and flexible workers Does GVC production solve this problem by separating the two types of labour by firm and even country, as proposed by Charles Babbage?

New Spatialities and Skill Deskilling (Braverman) Flexibilization and multi-skilling (Piore and Sabel) Back to craft: Recombination of conception and execution (Piore and Sabel) Gendered notions of skill

Changes in Forms of Management on the Shop Floor ‘Ford-Taylor’ assembly line = Direct control Piore-Sabel Flexible specialization = Responsible autonomy = Collaborative employee schemes Role of payment practices, ESOs

Labour Hiring (Payment Practices) Sub-contracting Part-time Temporary Piece-rated homeworkers And Permanent Core

Entering the Workforce The new workforce The role of pre-work identities – Caste – Tribe – Minorities – ‘Nimble fingers’ as ‘gendered attribute’ of women, or children

Workers’ Bargaining Power Depends on Market place power – her position on the labour market Household place power Work place power – segment of GVC Associational power – unions, other forms of organization, political role (Adapted from Beverly Silver, 2003, based on Erik Olin Wright)

Contemporary Issues Improving home-based work conditions Eliminating child labour from GPNs Dealing with influence of pre-work force identities

Contemporary Issues Commoditization of parts of production and homogenization of labour – Does this lead to weakened marketplace bargaining power and also reduce associational power? Does JIT increase workplace power of segments of workers? And of transport workers?

Contemporary Issues Can reduced associational power in one location – Be compensated by bringing together workers from more than one location? And/or – By linking associations with communities? Links between core and flexible work forces Is there a special role for labour in powerful states?

Contemporary Issues Nature of institutional support State policy