Trade unions improve work conditions and welfare on a global scale

Klaus Wälde emphasizes the positive role played by trade unions in occupational health and safety


What is the role of trade unions in a world becoming ever more individualized and global? How can a modern economy such as Germany afford to meet the traditional demands of trade unions in the light of global competition? In two recent publications, Professor Dr. Klaus Wälde of the Gutenberg School of Management and Economics at Johannes Gutenberg University Mainz and economist Alejandro Donado of the University of Würzburg consider these aspects and come to the conclusion that trade unions remain just as important in these global times and help not only to promote economic activity but also to improve quality of life in general.

Wälde and Donado look at the example of occupational diseases in order to evaluate these issues. Historically, the value of a group of workers joining together to take a unified and coordinated approach has been proven time and again. Take the example of the black lung disease. There was a particularly high risk that you might develop this disorder if you worked underground, particularly as a coal miner. A potential causal link between the disease and the occupation of miner was made by a physician as early as 1831. But it took another 130 years and many more cases of illness, protests, strikes, investigations and examinations for a law to be introduced in the USA officially accepting this connection. Similar examples for the effectiveness of coordinated action through what were essentially workers' movements in getting illnesses recognized as occupational illnesses can be cited in the agricultural sector, the ceramics industry, and the automotive industry, to name but a few. The current debate on whether the burn-out syndrome and related stress symptoms should be considered occupational illnesses shows how topical the subject still is today.

The first publication of Wälde and Donado - "How Trade Unions Increase Welfare" - discusses the benefits of coordinated action. If an individual becomes ill, it is impossible for him or her alone to determine whether this illness has to be attributed to personal predisposition, i.e. to inherited traits and/ or lifestyle, or whether the occupational environment is to blame. The major advantage of a group, in the form of a trade union for example, is its ability to gather information from a large number of different individual cases. If a sufficiently large number of miners falls ill with the black lung disease, it is much more difficult to disprove a causal connection than if only one or two individual cases occur. This advantage with regard to the availability of information together with their increased political impact as a group enable trade unions to intervene within the political process to ensure that improved occupational health and safety provisions are put in place at work.

In their second publication - "How Bad is Globalization for Labor Standards in the North", Donado and Wälde take their hypothesis and apply it to global considerations. Is Germany at a competitive disadvantage on an international level because it legislates for working standards that are relatively stricter than those of other countries? Is there thus a risk that capital and investments will be attracted abroad because there are "too many" and hence "overly expensive" occupational health and safety requirements in Germany? The surprising conclusion they draw is that this is, in fact, highly unlikely. Workplace health and safety provisions at work reduce rates of illness, thus increasing the returns on investments. Hence, if occupational health and safety is not "taken to excess", i.e. does not take up too much work time, it can even be of benefit to investors because it can create workplaces at which sickness and downtimes are comparative rarities, making such locations attractive options for new investments.

In a global economy, there is also the question of the possible expansion of trade union activities within developing and emerging countries. If developing countries were to adopt more stringent occupational health and safety provisions, would this development pose a risk to developed countries? Could the feared drainage of capital from the first world occur if levels of illness fall as a result of improved working standards in developing countries and the returns on investments consequently rise? This could indeed be the case - at least on a purely theoretical level. However, empirical analyses conducted by Wälde and Donado demonstrate that any related reduction in investment would be so small that none of us need to worry about this effect of globalization.

Improvements in health and safety at the workplace as a result of trade union activities should therefore be welcomed from both the economical and social point of view. We should not allow our working standards to become undermined merely because we are living in an age of globalization. The improvement of working standards in developing and industrialized countries has only negligible negative consequences for industrialized countries but has relatively much more pronounced positive effects for developing countries. There is thus no reason not to encourage increased trade union activities in developing and emerging countries.