ETUI Monthly Forum Restructuring of work in the New Member States: the impact on employment Dr. Vassil Kirov, Institute of Sociology, Bulgaria Bruxelles, 24 th of June 2010

Objective The presentation aims to outline the major conclusions about the impact of GVC restructuring on employment and industrial relations in the transitional economies

Structure : Flexibility Skills Careers Industrial relations Conclusions and perspectives

The report Prepared together by ISB and IS WORKS teams Analysis on the basis of company case studies, carried out in both in the new economy and matured industrial sectors The analysis is enriched with other experiences learned from different quantitative surveys (e.g. 4th European Working Conditions Survey - EWCS-2005, Continuing Vocational Training Survey - CVTS-2005, European Survey on Working Time and Work-Life Balance - ESWT- 2005).

The transition economies and the work organisation diversity Comparing the impacts of the GVC in NMS countries we have to be aware, that these post- socialist economies are representing different level of social-economic performance or success according to the various cycle of the transformation process. and have followed different development trajectories Bulgaria belongs into the country cluster characterised by significantly higher share of ‘Taylorist’ work organisation compared to the EU-27, Hungary shows a more fragmented pattern in distribution of work organisation types, with a high share of ‘discretional learning organisations’ (Valeyre – Lorenz et al., 2007

6 Source: Valeyre, Lorenz et al. 2008: 22

Value chains – longer and more elaborated? From the socialist co-operation to the global value chains – transformation of enterprises and FDI in CEE Location and changing position within the GVC are related to the resources available for the firms surveyed) Moving within the global value chains - the cases in IT, food and clothing also supplied evidence that countries in Southern Europe and Central and Eastern Europe are to some extent moving up the value chain, becoming intermediaries, or outsourcing, either partially or fully, some of their activities to countries outside the EU (Huws, 2008)

The Flexibility in NMS The increased flexibility in the assignment of task or deployment of personnel (Flecker) is closely connected to globalisation and development of knowledge economy, and it is based on increasing standardisation and fragmentation of processes, mainly as result of the spread of ICT and the convergence in standards.

Flexibility typology NumericalFunctional Internal Part-time work, flexitime arrangements, annualised working hours, working time accounts Multitasking, job enrichment, multiskilling, team working, project organisation External Fixed-term contracts, freelance work, temporary agency work, temporary layoffs/seasonal work, irregular work Subcontracting, outsourcing, freelance work Flecker et al., 2007

Flexibility patterns Numerical internal - full time work is still the predominant model in CEEC Numerical external – still weakly developed… Functional external – ssubcontracting and outsourcing are among the main sources of external functional flexibility in all case studies from the private sector Functional internal - GVC restructuring impacts multitasking, multiskilling and project work

Skills development after restructuring The supply of skills in NMS is problematic - a weakening of the complementary institutions in the NMS is visible in the fields of knowledge supply and labour relations New skill requirements in CEE The rising importance of in-company training after restructuring The importance of IT skills in all sectors examines (old industries, new industries, public administration) The rising importance of soft skills?

Career development New career opportunities/barriers, imposed by MNE that enter into NMS Limited opportunities for ‘global career paths’ among employees in NMS Rise in the demand for knowledge-intensive work shaped the possibilities for broadly defined and autonomous forms of work within high-trust, high-performance firm vs. new forms of work with low levels of autonomy, co-operation and participation due to the increasing formalisation, codification and standardisation of knowledge, skills and business processes.

Are changes negotiated? The impact on employment in NMS is not mediated by meaningful social dialogue The representatives of the employees (mainly unions) are not prepared to address the challenges of the GVC restructruing impact However different practices of adjustment at micro-level could be observed

Some conclusions Constantly increasing (functional) flexibility - in ‘old’ as well as in ‘new’ industries Models of flexibility and skill formation often imported through the GVC Flexibility is not always seen negatively by employees - numerical-internal flexibility assessed as giving competitive advantages or possibilities for better work-life balance Career development – dualisation Impacts of GVC seemed imposed by lead companies