Global business has been overwhelmed by the financialisation of wealth. Beyond financial and “rationalization” strategies, social conflicts and tensions have been strengthened as labor relations need to be adjusted to capital mobility and short-run returns. In this historical setting, it is worth noting that, in spite of the enormous literature on financial development and inequality, few attempts have been successful in rethinking the intersection between contemporary financial and labor markets in Economics Curriculum.
Indeed, in the current context of “institutionalized short-termism”, the expansion of global finance contributes to the redefinition of labor relations. Investors and managers have enlarged profits in the context of a business model that favors downsizing and cost reduction at the expense of employment. As labor costs are frequently considered large expense items, corporations must tightly managed and documented those costs in order to minimize risk of non-compliance, particularly public companies. Accordingly the Global Labor Union IUF, the current global business scenario fosters changing working conditions that result from:
- continuous restructuring of companies to generate cash outflow,
- redefinition of workers’ tasks,
- increased outsourcing and casualization to cut costs,
- sell-offs and closures of plants regardless of productivity and profitability,
- deteriorating working conditions in the workplace,
- more control on workers,
- diminished employment security.
Considering this background, we welcome David Weil’s recent book “The Fissured Workplace”. The author highlights that today, the employer-worker relationship has been submitted to delivering value to investors. As Weil’s groundbreaking analysis shows, the result has been an ever-widening income inequality. Weil also proposes ways to modernize regulatory policies and laws so that employers can meet their obligations to workers in the context of profitable business growth.
An interesting video on Weil’s ideas can be found at http://www.hup.harvard.edu/catalog.php?isbn=9780674725447
David Weil. The Fissured Workplace: Why Work Became So Bad for So Many and What Can Be Done to Improve It, Harvard University Press, 2014