Automation, unions and collective bargaining: the jammed transmission

Automation, unions and collective bargaining: the jammed transmission



Funding body: Fondazione CARIPLO
Grant Holder: Massimo Anelli
Project Duration: 2020-2023



Project Description: Automation produced important welfare gains but It has substantial distributional effects penalizing workers in regions that were historically specialized in industries adopting more robots and individuals whose skills were more substituted than complemented by the new technologies. Traditional relatively well-paid and stable jobs prevalently in the manufacturing sector have disappeared due to this process while new jobs have been created in service sectors or in new sectors (i.e. the Gig economy sector). These new created jobs are characterized by lower earning trajectories temporary contracts and little or no employment protection. Throughout the 20th century Labor Unions have played a crucial role in liberal democracies by preventing excessively unequal distribution of productivity gains and by channeling political sentiments and discontent into an organized voice. We theorize that the technological process has directly contributed to weakening the role of unions and make two hypotheses: 1) Union membership has shrunk and a large portion of employment (new jobs and workers in new sectors) is not covered by the traditional unions. We call this the a Extensive effectivea of technology on unions. 2) Given the reduced ability of representing employment the bargaining power of union has declined reducing the ability of cushioning the downward pressure on earnings of workers and the effectiveness in channeling individual sentiments in an organized manner. We call this the a Intensive effect  of technology on unions. Studying the impact of technological change on worker representative bodies is crucial in understanding the structural changes affecting western democracies and societies. However the academic literature has surprisingly not yet focused on this phenomenon mostly because of the absence of proper data.