Impact of globalisation Flashcards
increased demand for unskilled workers
The demand to reduce production costs has led to more non standard jobs of lower quality. Non-standard jobs are poorly paid, insecure, and temporary on part time or zero hour contracts; workers have fewer rights in relation to sick pay, holiday pay and pension rights.
Globalisation creates more non standard jobs because with global competition employers demand a more flexible workforce in terms of numbers employed, hours worked, tasks performed. At the same time there are fewer standard jobs. Standard jobs are those that are permanent, fulltime, well paid and workers are well trained and well qualified.
Moreover, with globalisation, companies can now manufacture products in countries where labour costs are low and sell these products across the world. Outsourcing means that work that used to be performed in the UK is moved to another country where labour costs are lower and workers have fewer employment rights. This leads to unemployment in the UK. eg call centres moving from UK to India.
increased demand for unskilled workers A03
Globalisation has increased the overall demand for workers. As markets have expanded, there is a larger consumer base and a greater demand for workers in both services and production. In 2016, the UK had a record high of almost 32 million in work (ONS).
changed how goods are produced
Klein says the logic of globalisation is not to spend money on machines that will rust, factories that need constant upkeep, and employees that will age and die; resources should be used on sponsorships, packaging, expansion, and advertising as it is this that will help to build superbrands.
This increased resistance to investing in labour and factories has led to the inevitable devaluation of the production process, producers and employees. Superbrand companies focus on first creating the ‘soul’ of companies and then removing the burdensome bodies of employees, factories and machines. For example, Nike sells most of their goods in the USA and Europe, but production takes place in Asia.
changed how goods are produced A03
Consumers benefit from this mode of production as prices are lower and there is a wider range of goods available. For example, Primark sells fashionable clothes at low prices, but its products are made in low cost Asian countries
such as the Rana Plaza factory in Bangladesh which collapsed in 2013 killing over 1,000 workers.
strengthened the power of companies and weakened the power of workers.
Castell and Beck argue that globalisation has meant that transnational companies, such as Shell, Nestle and Unilever are able to relocate their business to countries where labour costs are cheaper and where there are fewer regulations to follow than in the UK.
TNC’s do this as not only will their wage bill be lower but they will also pay lower company taxes; this will increase the profits of the TNC. The TNC is also able to put pressure on the government to offer them favourable terms in order to stay in the UK.
For example, the UK government was said to have offered Nissan a ‘sweetheart deal’, with possible tax breaks, to ensure it keeps car production in the UK. Moreover, the power of TNC’s weakens the power of trade unions to protect workers against low pay and poor working conditions
strengthened the power of companies and weakened the power of workers.
A03
TNC’s bring benefits to poor countries. TNCs increase economic growth and help to develop the infrastructure of poor countries. By employing local workers they will help to increase the living standards of the country and open up a new consumer markets.
increased the flow of migrant worker
Globalisation has also resulted in large population movements of people from poorer countries who are in search of a better lifestyle eg from low wage EU countries of Eastern Europe.
These workers take up low paid jobs in UK that British workers are reluctant to fill. A Home Office report found that this has caused a downward pressure on wage rates as some of these workers have undercut the pay of British workers and even led to some British workers being made unemployed.
Moreover, McKinnon found some communities were deeply affected by the globalisation of labour and felt threatened by its impact not only on job security and pay, but also on the increased demand foreign workers placed on education, health and welfare services. In such a situation, globalisation is perceived as an external threat to existing forms of employment and cultural identity
increased the flow of migrant worker A03
Nevertheless, the international prospects of professional and highly skilled workers has been boosted by globalisation; Gratton says these ‘transnationals’ are a global elite whose skills are in demand across the world. They possess specialist skills such as web designers, software programmers and administrators
