Globalization and labor movement

International Journal of Commerce and Management

ISSN: 1056-9219

Article publication date: 31 July 2008

Citation

Ali, A.J. (2008), "Globalization and labor movement", International Journal of Commerce and Management, Vol. 18 No. 2. https://doi.org/10.1108/ijcoma.2008.34818baa.001

Publisher

:

Emerald Group Publishing Limited

Copyright © 2008, Emerald Group Publishing Limited


Globalization and labor movement

Article Type: Editorial From: International Journal of Commerce and Management, Volume 18, Issue 2

Whether globalization is a current or an old development, its affect on various actors, be they individuals, organizations, or nations, is undeniable. This is especially true in the areas of human resources and labor movements. Workers across the globe have simultaneously lauded globalization or have attributed to it labor displacement, loss of jobs, and deteriorating living standards. In developed countries, including the USA and France, workers in traditionally industrial cities such as Flint, Detroit, Marseille and Roubaix have, over the last three decades, witnessed the negative side of globalization. In contrast, most workers in Shanghai, China, or Bangalore, India, appear to enjoy the fruits of globalization as their living standards have significantly improved and access to cultural amenities has become more easily available to them.

By the early 1990s, there was a great acceptance of free market principles which in turned accelerated trade and investment around the globe. Though the movement of capital and goods reached new levels, the free movement of labor lagged behind. This was furthered impeded after September 11, 2001 and the rise of nationalism in some European countries and in the USA. It was hoped that the three aspects of globalization – free movement of capital, goods, and people – would proceed steadily. Nevertheless, this scenario has proved highly unrealistic as the labor movement has failed to follow both trade and capital patterns of movement and as countries like the USA and France, among others, have imposed new restrictions.

Between 1870 and 1910, the free-flow of labor was impressive and capital moved freely among major countries. Though national borders did not disappear, there was relatively free movement of capital, commodities, and people across most parts of the world. It was estimated that in the second half of the nineteenth century, 15 million people crossed the Atlantic to settle in North America. North America had vast territories where people from Europe, for a variety of reasons, came to settle and to work. In recent years, workers from different countries, especially from South and East Asia, have moved to work in the Gulf Region where new world cities like Dubai, Abu Dhabi, Manama, Kuwait, and Dammam have been thriving economically and business opportunities are easily accessible.

Faced with economic growth and or inspired to position themselves as economically competitive, many developing countries find themselves pressed to open their markets to foreign labor. A prime example is the Arab Gulf countries. The Gulf Region, including Bahrain, Kuwait, UAE, Qatar, Oman, and Saudi Arabia, is blessed with ample energy resources, especially oil and gas. Owing to the tremendous increase in oil prices, espousing of free trade principles, and relative openness to the outside world, the region has become the destination for businesses that look for new opportunities, rewarding challenges, and business friendly environments. As businesses experience steady growth coupled with the scarcity of a qualified national workforce and a relatively small-based population, expatriates have moved into the region on a large-scale in order to be part of the new economic experience.

The estimate of expatriates’ share in the workforce in the Gulf Region ranges from as high as 92 percent in the UAE to as low as 57 percent in Saudi Arabia. While the share of expatriates in the public sector is generally modest, the share in the private sector across the board amounts to no less than 90 percent.

The Gulf Region attracts both skilled and unskilled labor. Indeed, expatriates are found in every economic sector and area. They come from every possible ethnic and religious group and their visibility and presence outnumbers the local population. It is this visibility and their economic participation which makes economic growth in the region feasible and subsequently creates ever evolving opportunities. Both local governments and MNCs have gained from and utilized expatriates’ contributions and efforts to achieve their respective goals whether in building national economies, improving standards of living and services, or increasing profits.

While both skilled and unskilled labor in the Gulf have benefited from their move to and employment in the region, skilled labor, in particular, has had the lion’s share of these benefits. Labor from the USA and Europe and to a degree from the Arab world has had better advantages in terms of salary and treatment than those offered to unskilled workers from South and East Asia. The harsh natural environment, the work and housing conditions, and the relatively low wages that these workers receive constitute critical issues that should be addressed in the context of globalization benefits and perils.

Without doubt, globalization eases labor movement to the Gulf Region. Furthermore, unskilled workers have access to opportunities which help them meet their social and economic needs. These opportunities might be much better than those available in their home countries. Nevertheless, this should not be an excuse to overlook their economic and social rights. In addition, even if the opportunities presented are much greater than those in these workers’ home countries, policy makers and human rights agencies should make certain that foreign workers are assured of work security, safety, and dignity.

Rigid nationalism and politically inspired discriminatory labor relations policies restrict the natural expansion of economic globalization and limit possibilities worldwide. Facing them with moral clarity and courage makes the fruits of globalization available not only to the privileged classes but also to those people who feel that globalization has marginalized them.

Abbas J. Ali