Changing Contours of Work. Stephen Sweet

      Exhibit 2.5 Trade Union Members as Percentage of All Employees: International Comparisons, 2015

      Source: Organisation for Economic Co-operation and Development.

      The United States stands out in the international arena because of the combination of dramatic declines in membership and its exceptionally low current levels of unionization. The fact that unions remain important in other advanced economies, and that service workers who are typically unorganized here belong to unions there, is strong evidence that unions can still matter. Early in the twenty-first century, a major national survey found that the majority of unorganized American workers would vote for a union if one were available to them (Freeman 2007). And, while support for unions waxes and wanes somewhat, public approval of labor unions has risen steadily since the Great Recession and now stands at 62%, its highest level in almost two decades (Saad 2018). A recent analysis of survey data on workers’ attitudes found that most workers would like to have more “voice” at work, there has been an increase in the desire to join unions in recent years (including among younger workers), and better educated and minority workers are particularly favorable to joining unions (Kochan et al. 2018). Unions may not be a vestige of the old economy, but whether they will thrive in the new economy depends on whether they develop effective strategies for attracting new members and organizing new sectors of the workforce. It also depends on the resources made available to union organizers and the constraints placed on their actions.

      A New Global Economy?

      A final and much-discussed aspect of the new economy concerns globalization. Has the emergence of a global economy fundamentally changed the economy and the situation of workers worldwide? In some respects, the global economy is not really new. The histories of virtually all modern societies, from the sixteenth century onward, can be traced to international economic ties (Wallerstein 1979, 1983). For example, colonial America participated in international trade of slave labor, sugar, rum, tobacco, cod, and textiles (Kurlansky 1998). Had it not been for these exchanges, the present-day demographic makeup of the United States would be profoundly different, as would its culture. Likewise, the export of slaves to the United States had an enduring impact on the development of African societies. Trade with Asia is not new, and the European “discovery” of America was the result of attempts to find better trade routes. Indeed, international trade has long been in existence and has gone through numerous cycles of growth and decline (Chase-Dunn, Kawano, and Brewer 2000).

      Nevertheless, one must still acknowledge that the extent of global economic activity is unprecedented and that the penetration of global capitalism to all corners of the world is both more complete and more complex than ever before. The new global economy can be described as a vast international network capable of rapidly developing and diffusing resources, technology, and information across the world. Among the key characteristics of the new global economy are the following:

      It should be added that the new global economy is also characterized by new types of legal and political arrangements designed to promote globalization. In the past, global economic activity was supported politically in various ways. Nineteenth-century colonial occupation created economic opportunities for employers in the dominant country (e.g., British enterprises benefitted greatly from British colonial activity in places such as India). Even after the colonial empires dissolved, enterprises in the developed world often continued to derive considerable benefit from activities in the former colonies, aided by political, military, and diplomatic support from their home governments. On the other hand, international economic activity, especially among industrialized countries, was often limited in various ways by tariffs and other legal arrangements designed to protect domestic economies. It is this last situation that has begun to show signs of change in the new economy. Accompanied by economic theories that trumpet the benefits of free trade and the free movement of goods, services, and investment, many countries have joined in a variety of free trade agreements and even currency unions that remove many of the barriers to international economic activity. Notable examples include NAFTA, designed to enhance free trade among the United States, Canada, and Mexico, and the European Union, which has created a large free trade zone among many of the countries of Europe and includes a common currency shared by at least some of its members. These political efforts to promote globalization have met with some high-level resistance—in the United States, President Trump has made his opposition to NAFTA and other multi-lateral trade deals a hallmark of his presidency, and the British in 2016 voted to leave the European Union (Brexit). However, the fact that the effort to replace NAFTA with a better deal resulted in only relatively minor modifications, the predictions that Brexit will have disastrous consequences for the British economy, and the continued emergence of new global trade deals (such as the Trans-Pacific Partnership, which moved forward without American participation), suggest that globalization and the international emphasis on free trade are not a passing fad.

      These arrangements make it much easier for goods and services to move across borders and for companies based in one country to establish facilities (or move them) to a range of others. One result has been that cultural and technological changes in developed and developing countries are accelerating at unprecedented rates. The speed of change, the extent of diffusion, and the flexibility of webs of connection set the current organization of work apart from the systems that preceded it (Castells 2000, Mattsson 2003, Milberg 2004). As one observer has remarked, the world is now, probably for the first time, approaching “universal capitalism” (Wood 2003).

      Companies are integrating themselves into the global economy for a variety of reasons. An obvious reason is that companies try to move closer to emerging markets for their products; as countries such as China, India, and Brazil grow and industrialize, their residents emerge as new markets for products made by foreign companies, who often set up facilities nearby to be able to manufacture products for local consumption. Labor cost savings also are a major motivator; some companies locate in low-wage countries not to sell their products there, but to reduce the cost of manufacturing goods to be sold in the United States and other developed economies. This is why some companies who had invested in production facilities in China, where labor costs have begun to rise, are now considering moving manufacturing operations to countries such as Vietnam and Indonesia.

      Some critics argue that manufacturers, particularly those in highly polluting industries, are drawn to developing countries with lax environmental rules and enforcement. For this reason, many economists argue for stricter environmental standards as a means to control job flows. However, not everyone agrees, as counterevidence suggests that companies seek stable regulations, not necessarily loose ones, in making decisions about where to invest (Jones 2005, Rivera and Oh 2013). The tax structures of nation-state systems also encourage the movement of jobs. Companies that operate in multiple countries have the opportunity to concentrate their tax obligations in the country with the lowest tax rates. In some cases, they may even deliberately “move” outside the United States, while