Globalized labour markets and social inequality in Europe

Theoretical framework

authored by: Sandra Buchholz, Kathrin Kolb, Dirk Hofäcker, Hans Peter Blossfeld
Abstract: Globalization has powerfully shaped both national economies and individual life courses in modern societies during the last three decades (Blossfeld and Hofmeister, 2006; Blossfeld, Buchholz and Hofäcker, 2006; Blossfeld, Mills, and Bernardi, 2006; Blossfeld et al., 2005, 2008). The growing flows of capital, commodities, services, labour, and information across national borders have intensified the exchange among people from countries with quite different productivity levels, wage structures, social standards, work cultures, and investment opportunities — in particular after the fall of the Iron Curtain. The emergence of a single worldwide market has therefore enhanced the number of competitors — with the effect that a larger market spawns more international specialization of labour and more rapidly transforms older industries and occupational structures and brings new ones into being. Furthermore, the competition between more heterogeneous market participants and companies working under different production conditions has increased, which in turn has raised the likelihood of market turbulences, the volatility of market developments, and the rate of technological progress in the economy. In addition, the increasing mobility of production factors across national borders, in particular financial capital, has led to a rising tax competition among welfare states and to governments increasing their efforts to deregulate, privatize, and liberalize their national economies. The importance of the market as a coordinating principle appears to increase with actors competing on a larger and intensified scale. Acceleration and rising uncertainty of social and economic processes in open economies have been reinforced by the constant improvement of modern information and communication technologies, which allow individuals to connect faster around the globe. Thus, important scientific discoveries and technological advances, including new and better materials and improved methods of production as well as consumer fashions and product innovations, are diffusing much faster throughout the interconnected world. The increasing integration of the world’s economic community also creates unprecedented interdependences and therefore reinforces the exposure of local markets to random external shocks (such as major political and economic crises, technological inventions, wars, terrorist attacks, etc.) occurring someplace on the globe. In other words, global markets are not only more dynamic and are pushing technological advances in an extraordinary manner, but they also have turned out to be less predictable and more risky. The increasing acceleration of technological innovation and rising uncertainty of the social and economic environment of firms require companies to respond faster to these changes (Castells, 2000; Mills and Blossfeld, 2005). More precisely, there is a rising need for a more flexible work organization in most firms and organizations. In an era of globalization, they need to be increasingly able to quickly adapt their employees’ composition and the size of their workforce to market changes.
External Organisation(s): University of Bamberg
University of Mannheim
Type: Contribution to book/anthology
Pages: 3-22
No. of pages: 20
Publication date: 01.01.2011
Publication status: Published
Peer reviewed: Yes
ASJC Scopus subject areas: General Social Sciences
Sustainable Development Goals: SDG 16 - Peace, Justice and Strong Institutions
Electronic version(s): https://doi.org/10.1057/9780230319882_1 (Access: Closed)