Robots Steal Jobs From Unions
Collective bargaining is a fundamental pillar of the European social model. In Italy, over the decades, unions have ensured wage increases commensurate with productivity growth and a gradual improvement in working conditions. Today, however, they are in decline: in 20 years, according to a Bocconi study, the unionization rate has been declining from 30 percent to about 12 percent. Fewer members means less bargaining power, hence less protection at a time in history when the challenges of technological development would, on the contrary, require greater worker protection in the face of shrinking employment in some sectors.
Conducted by a team of researchers from Bocconi University, led by Paolo Agnolin, Massimo Anelli, Italo Colantone and Piero Stanig, and funded by Fondazione Cariplo, the study explores the impact of new technologies on the European union landscape. By analyzing union membership data in 15 European countries over a 20-year period through 2018, the study offers valuable insight into the evolving role of unions in the digital age.
The lack of disaggregated official data on the number of union members hinders research on the impact of social change on unions. We know the overall data on unionization in a given country and in a given year, but we do not have more specific numbers describing differences in union membership across industries and geographic areas. The Bocconi study, with an innovative method for estimating the percentage of unionized workers, has made it possible to create a unique dataset to fill this information gap.
The results show a widespread negative trend, with Italy getting closer to traditionally unionized countries such as France. Differences between regions and sectors are clear: from 25 percent in Trentino-Alto Adige to 7 percent in Liguria, and from 27 percent in public education to 6 percent in house help.
But what is to blame for this not-so-slow decline? “Globalization and automation have contributed to a reduction in employment in those sectors, such as manufacturing, where unions were traditionally stronger,” explains Massimo Anelli, an associate professor in Bocconi's Department of Social and Political Sciences and an expert in labor economics. “Besides, entire sectors that have developed thanks to technology, think of gig economy activities, did not exist until a few years ago, and as a result unions are practically absent.”
As the base on which trade unions can rely gradually shrinks, so does their negotiating strength. “Simplifying, we can think of the production of goods and services as the result of a process that employs two factors, labor and invested capital,” Anelli continues. “In contemporary society, in which technology (which is part of invested capital) plays an increasingly central role in the production process, the importance of the labor component is progressively diminishing. At the same time, with fewer workers in unions, the ability of unions to protect wages decreases accordingly. It is a dog biting its own tail.”
That is why, Anelli concludes, “A strong union is important to protect social cohesion in the face of structural changes in society. Our data tell us that the unionization rate is falling: if this trend is not reversed, Italy risks the lowest levels of union participation in Europe.”
