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1. Global Labour Flashcards

1
Q

Spatial Fix Definition (Harvey 2011)

A

“Spatial displacement through opening up new markets, new production capacities, and new resource, social and labour possibilities elsewhere”

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2
Q

Why do companies find a spatial fix?

A

Competition eventually becomes fierce in one place

Labourers demand better wages and conditions

Forces profits to shrink

Opportunities to produce elsewhere cheaper and with less competition

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3
Q

Merk 2011 labour intensive industries:

A

When wages start to increase and/or workers gain power companies may safeguard profit
- by relocating to where workforce can be found with no experience or unions

External solution for emerging profitability crisis and labour control

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4
Q

Example of a company that undertook spatial fix

A

Nike knee wages were lower in Asia, first mover 1980s

Puma and Adidas still manufacturing in high wage European counties, Nike overtook them in market share
- by 1990s copied Nike

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5
Q

Geopolitical context of spatial fix

A

Cold War

US led capitalism vs soviet led communist powers

Offshoring initiatives took place within alliances

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6
Q

What is a vassal state?

A

Subordinate to a superior state

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7
Q

South Korea was a vassal to US, impact on economy of South Korea?

Export led industrialisation

A

Late 1980s footwear exports accounted for 5% of annual exports for South Korea

20% shoe production globally

Reebok and Nike sourced 55% from South Korea

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8
Q

What leads to Sweatshops?

A

Rapid industrialisation = terrible working conditions

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9
Q

Management in factories (sweatshops)

A 
Authoritarian 
Patriarchal
Strong arm management 
= 
High productivity

Dictatorship and repressive labour laws
Barred trade unions

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10
Q

The Great Labour Struggle 1987 South Korea

A

Industrial action

Push for democratisation

Strikes and protests

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11
Q

South Korea by early 1990s

A

2/3 fully unionised

Had higher wages and safer conditions

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12
Q

South Korea become more expensive and profits fell due to

A

Labour shortages

Growing wages

Stronger unions

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13
Q

After South Korea what other countries provided opportunities for relocation?

Alternative sources of supply

A

China

Indonesia

Taiwan

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14
Q

Taiwan followed South Korea

A

Didn’t result in massive strikes or protests

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15
Q

Taiwan labour shortages and wage rises resulted in profit squeeze

A

Labour reforms introduced aiming to recuse Taiwan’s trade surplus

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16
Q

US government pressured Taiwanese government

A

Reduce US firm reliance upon Taiwanese Spatial Fix

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17
Q

Where did Taiwanese manufacturers turn to?

A

China, exporting to south China coast

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18
Q

China working conditions

A

Less organised

Less able to demand higher wages

= greater productivity

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19
Q

How is productivity enabled

A

Poor working conditions

Disorganisation of labour

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20
Q

Taiwanese movement to China simpler because

A

Fewer linguistic, ethnic and cultural barriers to overcome

Controlled by Taiwanese capital

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21
Q

Indonesia spatial fix

A

Entry into production was rapid

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22
Q

Why was Indonesia’s entry into production rapid

A

Increase scales of operation, larger manufacturing sites, better resist low cost demands from buyers

Greater flexibility, timeliness and accuracy

Speed up design to market time, design themselves

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23
Q

Learn to resist management consequence

A

Less productive

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24
Q

Vietnam Doi Moi 1986

A

Legal reform to attract foreign investment

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25
Nike 1995 sourcing in Vietnam
Even lower wages than China
26
Spatial shift pattern
South Korea Taiwan China Indonesia & Vietnam
27
Retail dominated/buyer-driven commodity chains result of:
Logistical integration made possible by revolution in IT transport technology Neoliberal restructuring of rules of global economy
28
Pressures to relocate China
Shareholders demanding greater return on investments (Milberg 2008)
29
Global retailers in China
Has facilitated US expansion of low wage, import dependant retail sector Huge export manufacturing boom in coastal China
30
Why have retailers gained power in relation to brands since the 1990s?
Taken advantage of its monopoly of information about changing consumer preferences
31
Relationship of global labour and retailers?
Affects relationship between capital and labour in east Asia
32
Buyer driven commodity chains are a result of?
Logistical integration made possible by revolution in information and transport technology Neoliberal resourcing of rules of world economy
33
Buyer driven commodity chains facilitate
US expansion of low wage, import dependant retail sector Huge export manufacturing boom in coastal China - driven by shareholders demanding greater return on investment (Milberg 2008)
34
Huge export manufacturing boom in costal China driven by
Shareholders demanding greater return on investments (Milberg 2008)
35
How do retailers gain a more precise understanding of demand?
Track consumer behaviour and transmit customer preference down supply chain New IT collects POINT OF SALES (POS) data - relays electronically down supply chain to initiate replenishment quickly at minimum cost
36
Retailers goal?
Procure goods consumers want to buy not what suppliers find convenient and profitable (Applebaum & Lichenstein 2006)
37
Walmart is
The worlds largest retailer
38
Because Walmart is the worlds largest retailer they can
Make markets Define shopping environment Set everyday low price Specify rules of conduct and standards for thousands of global suppliers (Applebaum & Lichenstein 2006)
39
China can capitalise on market growth whilst exporting its DEFLATIONARY POWER
Low wage labour = reduced price of products sold Don’t need same wage to live as costs lower in countries
40
What is deflationary power?
Low wage labour = reduce prices of products sold
41
Neoliberal politics and the Rise of China
1. Neoliberal ideas and free trade 2. US 1970s stagflation and 1980s collapse of minimum wage 3. Liberalisation initiated in China 1979 4. US labour law hollowed out: trade unions weakened 5. East Asian competitiveness, NAFTA and Chinese liberalisation (make Asia competitive)
42
Impact of Walmart ‘World Purchasing’ HQ in Shenzhen China
Turned 3000 Chinese suppliers into powerless price takers Had to battle against one another Walmart defeating prices
43
Yue Yuen Industrial supplier labour force
80% women Heavily reliant on migrant from outside region
44
Walmart CSR contribution
Factory certification programme following 1992 NBC documentary on child labour in Bangladesh Audit all suppliers once a year
45
Why does Walmart have a poor record?
Drive for low prices conflicts CSR efforts Difficult to control/audit sub-contractors Delegated CSR
46
How are workers starting to gain power in China?
Exploding demand Shop-floor labour shortages
47
International labour standards regulated by
International Labour Organisation | Includes UN Human Rights
48
Why may the ILO advantage firms?
Weakens role of trade unions
49
Employers often regard labour rights as `
Aspirational, implemented when and if they become `economically sustainable‘.
50
Why is the ILO visibly impotent?
Moral leadership, but without enforcement power to sanction labour-standards violators.
51
Walmart and IKEA rely on global sourcing networks
Yet are sensitive to consumer norms through their retailing establishments, avoid scandals
52
IKEA is more flexible so
More successful in internationalising its concept to more counties
53
Both Walmart and IKEA have strong corporate cultures
Organised around narratives about their home countries (Sweden and USA)
54
IKEA global presence
37 countries with stores, 139000 directly employed workers in 44 countries.
55
Wal-Mart global presence
Largest firm and retailer in the world. 1.3 million direct employees, 3400 stores in US.
56
IKEA claims that poor worker treatment results from
Poor management.
57
IKEA cost reduction strategy accomplished through
High volume production and innovation in materials, transport and packaging
58
IKEA part of philosophy is to demand decent labour conditions from its suppliers
Claimed to derive from prevailing norms and institutional relationships in Swedish welfare capitalism
59
According to IKEA there is no supposedly inherent conflict between maintaining good working conditions
and maintaining profitability
60
IKEA philosophy gives unions and NGOs instruction to
monitor and address specific problems to ensure laws are followed
61
KEY conflict IKEA
The systematic cost-reduction strategy of IKEA is at odds with upholding high labour standards of IKEA way.
62
IKEA Response to conflict between labour standards and cost reduction
Sustained contracts rather than high short-term profits followed by costly setting up of new contracts Long-term relationships as a route to cost-effective production Established quiet and controllable resolution mechanisms, avoiding damage to the public image. Struggles to self-monitor, even when it is in its own interest to do so. Remaining incentive for suppliers to cheat the IKEA way.
63
How to explain Wal-Mart’s Strategy and Uneven Success?
Its international subsidiaries appear to perform better in markets where there is: Weaker labour organisation and union autonomy Weaker labour regulation enforcement Wage bargaining is towards the individual end of the collective-individual axis Lifetime job tenure/security is highly unusual Culturally inflexible (Durand and Wrigley, 2009).
64
Wal-Mart’s Code of Ethics
Seeking to detect public relations problems arising from poor supplier labour relations before unions. Rather than work with suppliers to resolve labour relations issues, it ends its buyer relationship, and disassociates itself from the supplier.
65
IKEA vs. Wal-Mart Summary
Both have adopted cost-reduction strategies with labour exploitation an inevitable outcome. Wal-Mart adopts a strict legal approach, keeping trade unions and NGOs at arms-length distance, severing ties with contractors upon breach of CofC. IKEA works closely with trade unions and NGOs to be able to sustain long-term relationships with contractors. IKEA does not have enough control to institute concrete protections among their suppliers when faced with national conditions in which labour rights are not respected. Remaining incentive for suppliers to cheat IWAY.
66
Recent example in news
#iwannabeaspicegirl T-shirt’s to raise money to ‘help champion equality for women and girls here in the UK’ comic relief Produced by women expected to work 16 hours a day in Bangladesh

Globalisation (6 decks)

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