Thursday, September 18, 2008

Social Justice

Preparations for my second year at BGI are under way. I am reviewing some of the work I produced last year and decided to post a book review assignment from MGT 567: Social Justice and Business. This is something you may not expect to see coming from an MBA student's assignment archive, and perhaps this is the point. Please, if you forge through this, provide some [constructive] criticism (image from sunysb.edu).

The books I reviewed addressed the challenges facing women working in subcontracted and informal labor markets in Sri Lanka, India, The Philippines, Thailand, and Pakistan.
The Hidden Assembly Line by Radhika Balakrishnan is a book focused on “…subcontracted work as a method for capturing the links between changing labor dynamics in several industries and macroeconomic policy at the national and international levels.”[1] The book provides an overview of the common themes running through the five Asian economies in which studies took place, Pakistan, India, Sri Lanka, Thailand, and The Philippines. Singular studies within the book conducted in each of the five aforementioned countries dive into greater detail, often including in-person interviews with women working in subcontracted labor arrangements. This review focuses on two of the book’s studies, one by Swarna Jayweera addressing subcontracted women workers in Sri Lanka and the other by Jeemol Unni & Namrata Bali focusing on subcontracted women workers in the garment industry in India.
The second reading, highlighting international conventions and recommendations addressing labor, specifically gender related issues, is published by the International Labor Organization (ILO). This collection lists twenty-two internationally sanctioned conventions that have been agreed to. Given the role the ILO plays in international labor practices, a brief overview of the ILO is warranted.
The International Labour Organization (ILO) is devoted to advancing opportunities for women and men to obtain decent and productive work in conditions of freedom, equity, security and human dignity. Its main aims are to promote rights at work, encourage decent employment opportunities, enhance social protection and strengthen dialogue in handling work-related issues.
In promoting social justice and internationally recognized human and labour rights, the organization continues to pursue its founding mission that labour peace is essential to prosperity. Today, the ILO helps advance the creation of decent jobs and the kinds of economic and working conditions that give working people and business people a stake in lasting peace, prosperity and progress.
The ILO was founded in 1919, in the wake of a destructive war, to pursue a vision based on the premise that universal, lasting peace can be established only if it is based upon decent treatment of working people. The ILO became the first specialized agency of the UN in 1946.
The ILO is the global body responsible for drawing up and overseeing international labour standards. Working with its Member States, the ILO seeks to ensure that labour standards are respected in practice as well as principle.[2]
The opening chapters of the Hidden Assembly Line take us through some of the enabling conditions for the creation of subcontracted and home-based work. What I found fascinating was that in all five countries studied, the liberalization of their economies allowing internal labor markets to be accessed by foreign entities helped lead to the creation of subcontracted labor markets. Oftentimes, the liberalization of these countries’ economies were assisted (or encouraged) by the International Monetary Fund (IMF) and World Bank Structured Adjustment Programs (SAPs)[3]. This was strikingly similar to what was learned from watching “Life & Debt”, chronicling Jamaica’s struggles with international lending. The SAPs, in combination with the Asian financial crisis of 1997-1998 and the liberalization (privatization) of the economies resulted in a increase in the price of utilities, increased competition with inexpensive imports, a reduction in subsidies, and an overall need to decrease the costs of production. The industries examined (textiles in many cases) experienced a move toward low-paid, low-skilled subcontracted work for women.[4]
The Sri Lankan study covers subcontracted women workers in five industries or specializations, women winding wire around a core as a component in an overseas electronic component, embroidery-knitting and smocking for a rural garment manufacturer, women weaving nets and mats for export, women in a farming community cultivating tobacco for domestic cigarette manufacturing, and women hired by subcontractors at construction sites in Colombo (former capital of Sri Lanka)[5]
The Indian study focused on the garment industry in India, an industry in which women account for approximately 25% of the total employment.[6] In this casa, as in the Sri Lankan study, materials produced were for both the international and domestic markets.
ILO conventions on home-based workers were mentioned explicitly in the Sri Lanka study performed by Swarna Jayaweera[7]. The convention, ILO # 177[8] is detailed in an excerpt below. Enforcement of the convention, by including subcontracted & home-based workers in national laws, is lax.

Convention No. 177
Convention concerning Home Work, 1996
1. The national policy on home work shall promote, as far as possible, equality of treatment between home workers and other wage earners, taking into account the special characteristics of home work and, where appropriate, conditions applicable to the same or a similar type of work carried out in an enterprise.
2. Equality of treatment shall be promoted, in particular, in relation to:
(a) The homeworkers’ right to establish or join organizations of their own choosing and to participate
in the activities of such organizations;
(b) Protection against discrimination in employment and occupation;
(c) Protection in the field of occupational safety and health;
(d) Remuneration;
(e) Statutory social security protection;
(f) Access to training;
(g) Minimum age for admission to employment or work; and
(h) Maternity protection.

There were a number of themes that were shared throughout the two studies. A few are highlighted here
  • Opening of economies under IMF SAPs lead to greater influx of export labor that were generally unskilled and did not promote the creation of industries based in the countries that would help them develop
  • Women generally held the lowest paying and lowest skilled jobs in outsourced arrangements
    • These jobs could lead to repetitive injuries
    • Did not generally offer the opportunity to build skills that would be transferable to the formal economy
  • Women were often forced to leave the formal economy when they were married or had children, reflecting a gender bias addressed in ILO conventions but rarely adhered to or enforced
  • ILO conventions have been in existence for many years, some dating to the 50’s, that address gender equality, yet there is very lax enforcement of these conventions
    • It is interesting to note that conventions on equal pay exist from the 1950s, they appear not to be followed here in the United States[9]
  • In interviews, women were at times grateful for the opportunity to work in flexible ways; they had more input into the family’s decision making as they contributed to the families economic well-being.[10]
  • Regardless of their work arrangements, women were still the main responsible party for the tasks associated with the homestead (another indicator of women’s role stereotyping) and child rearing.
  • Complaints revolved around of the sort addressing the “middle-men” the people that arranged for the home-work in the informal economy that often took their “share” of the overall earnings actually provided by the women working at home. In other words, the middle-men extracted too much value from the women’s labor. This reflects the hidden (shadow) nature of subcontracted women workers and the lack of formal rules around their engagement.[11]
  • While there are ILO conventions governing many of the problem areas presented in the book, it is unclear as to what level of enforcement exists.
  • Accurate data on the informal economy is hard to obtain and is many times unreliable; anecdotal evidence is often used, though can be equally as powerful, if difficult to quantify in ways deemed appropriate by funding organizations.
When thinking about the affects of globalization on women workers, it is all too easy to fall into the trap of assuming the worst. While the problems with subcontracted women workers are real, what was so surprising were the positive impacts associated with this subcontracted work. One could argue that the need for some of these informal networks of home-based women is rooted in their exclusion from the official rolls of eligible labor. When they marry or become pregnant, women are sometimes prevented from working. Given the poor economic positions experienced by many of the families profiled in The Hidden Assembly Line, the extra income earned by the women make a significant impact on their family’s well-being.
The networks of subcontracted women workers, whether home-based or operating in small factories, were subject to the whims of the global economy as well as the inconsistencies with their managers and the companies that contracted them. Payment was sometimes erratic, and the subcontracted arrangement could be terminated with very little notice. They were the part of the value chain that reaped the least amount from the stream of profit associated with the items they made; in the case of garment manufacturers in India, they made only 2% of the total value of the item.[12]
In summary, though there are some benefits associated with the informal employment of women in the subcontracted labor force, they remain subject to the vagaries of the “push” model of globalization, where international firms are searching for the lowest costs production of goods for competitive reasons.[13] These women are therefore in jobs that cannot be guaranteed with any level of comfort for the long-term, are generally in the lowest skilled vocations that have little chance of helping them develop advanced skills that lead to higher earnings potential, and remain subject to gender discrimination regarding work in general.
There is little evidence that globalization and the “push” for lower costs associated with production of consumer goods will abate any time soon. This is worrisome for women working in situations dependent upon lowest cost. What may be a strategy to avert the potential damage from a collapse in a local subcontracting networks will be the integration of the informal into the formal. Though there are existing ILO conventions addressing some of the issues raised in The Hidden Assembly Line, it appears that more rigorous enforcement strategies are lacking and must be better coordinated globally.

Bibliography
Balakrishnan, R. (2002). The hidden assembly line: Gender dynamics of subcontracted work in a global economy. Kumarian Press. ISBN: 9781565491397.



[1] Balakrishnan, R. “The Hidden Assembly Line”, Kumarian Press, p. 1
[2] http://www.ilo.org/global/lang--en/index.htm
[3] Balakrishnan, “Hidden Assembly Line”, Kumarian Press, p.30
[4] Balakrishnan, p.30
[5] Balakrishnan, p.65
[6] Balakrishnan, p.115
[7] Balakrishnan p. 81
[8] International Labour Organization, “Gender Equality and Decent Work”, p. 131
[9] International Labour Organization, p. 3
[10] Balakrishnan, p. 31
[11] Balakrishnan, p. 80
[13] Balakrishnan, p. 18

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