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Page context: Home > Transport International Magazine > Issue 35 - April 2009 > Power to the workers
In August 2002 a BBC television Newsnight broadcast reported that: “Transport workers now occupy a new strategic position in the global economy”. This was a prophetic statement: the next month the International
Longshore and Warehouse Union (ILWU) membership on the west coast of the United States were locked out by the Pacific Maritime Association for 10 days. It was estimated to have cost US$2 billion a day to the US economy.
The economic importance of logistic workers and their trade unions has also been recognised by a number of academics. A recent report by Edna Bonacich and Jake B Wilson confirmed these workers as the “circulatory system of global capitalism. Global production and distribution thrust them into prominence as strategically vital actors.”
If this is true, why haven’t transport workers, especially those working in logistics, and their trade unions recognised this new power and used it to improve their working conditions?
Globalisation and the supply network
The global transport and communications infrastructure has changed beyond recognition in the last two decades. Developments and improvements to this infrastructure have been the key to making globalisation possible by integrating the world. At the very centre of this globalisation are logistics workers, especially transport workers. While today’s globalisation may be new, its central drivers are certainly not; capitalist logic continues to set its trajectory.
However, many logistics workers only understand a small part of their supply network and do not understand their role or the role that other logistic workers play in these networks. Transport workers need to understand their logistics networks and their inherent vulnerabilities. Who are the key workers? Where are they in the global supply chain? Are there certain key dates in the year, for example October for Christmas deliveries? Knowing and understanding their supply network will empower logistics workers.
For many transport workers their first experience of logistics was through the growth of lean manufacturing. Lean manufacturing relies heavily on just-in-time systems and minimum stock levels. It has become embedded in managerial thinking, philosophy and practice, so much so that we hardly think about it, but the implications for transport workers are significant and are felt on a daily basis.
Retailing has taken over from manufacturing as the key sector of the global economy and this is because of the role played by the “big-box” retail chains that now occupy the strategic heights of the developed economies. At the core of these global supply chains stand the Wal-Marts, the Home Depots, Tescos and the Carrefours of the world and these companies are increasingly using lean retailing methods which also rely heavily on just-in-time systems and minimum stock levels.
Over the years we have all seen many companies, both manufacturers and retailers, outsource their transport functions, putting them out to the market. This market testing has resulted in a reduction of the terms and conditions of employment of transport workers who have been outsourced. Employment insecurity in transport has increased as these contracts are put out to tender and they can change hands every two or three years. Sometimes the workers move with the contract, other times they stay with their original company; others lose their jobs.
We are also seeing the emergence and expansion of global logistics companies. These companies are moving out from their traditional transport sectors, such as railways or shipping, and offering their customers a complete global supply chain solution. For example Schenker, a unit of German transportation giant Deutsche Bahn, is rapidly becoming a global logistics company. Or Maersk, the world’s biggest container shipping company, which is now offering global supply chain solutions. DHL, arguably the world’s largest logistics company is a subsidiary of Deutsche Post, the German postal monopoly.
The consolidation of the logistic industry is increasing in pace. Recently, we have seen the takeover of Christian Salvesen by Groupe Norbert Dentressangle, the French transport and logistics group.
However, no matter how large or important these logistics providers are in the supply networks, whether national or global, they are under continuing pressures to cut costs. It will be of no surprise to learn that this downward pressure is coming from the big box retailers. Given that labour makes up the largest element of transport costs, logistics workers are bearing the brunt of cost reductions through a worsening of their terms and conditions of employment
In the next few years the logistics industry will be facing major changes, both in terms of consolidation, due to the increasing number of takeovers, and the reduction of labour that will result from the consolidation of the industry. Also, changes in technology, for example radio frequency identification (RFID), and changes in management thinking, for example consolidation centre bypass, will have major impacts on the transport industry.
For the transport worker driving their van or lorry, the warehouse worker, the transport clerk or the IT technician working in transport or other related industries it is easy to feel isolated and powerless against these global forces. But the reality is completely different, and as previously stated this has been recognised both by the media and academics.
If the full benefits of globalisation are to be achieved, then the strategic importance of the logistics workers must be recognised and rewarded. In the age of the network, logistics workers will be key players in the global economy.
The importance of these transport or logistics workers has also been recognised by both the ETF and the ITF. They, along with some of the trade unions affiliated to them, recognise the need to understand how these companies operate now and possibly more importantly how they will operate in the future. They have recognised that lean retailing is increasingly vulnerability to supply networks shocks.
These shocks can take various forms, but industrial action is one obvious form of shock.
These companies do plan for these shocks, but there is only so much they can do in terms of increasing stock levels, or having alternative distribution routes. However, if they increase these contingencies above a certain level they then lose the benefits of the lean retailing process.
However, while the structure of capitalism has changed, many trade union structures, including those in transport sector, are still based on the old Fordist capitalist structures. We believe that these trade union structures have to change to reflect the realities of modern capitalism. But people, both union officers and lay members, have risen to power through these Fordist structures and they have little or no reason to welcome change. Any change in the existing trade union structures could alter their power relationships within their organisations and their relationship with other trade unions and also within their global union federation.
The same argument applies to the global union federations. They are also based on the old Fordist models, but the boundaries between them are becoming increasingly blurred. Capitalism does not distinguish between the postal sector and the logistics sector but the global union federations still do.
The challenge for logistic workers, according to Bonacich and Wilson “is not only to get their own unions in order and to struggle for gains for their membership, their challenge also lies in recognising the role they could play in gaining the power necessary for the working class to place serious demands on global capital”.
The challenge for the international trade union movement is to recognise that logistics has replaced manufacturing as the core of modern industry. Unions also need to understand the industry and where it is going, in order that their members can gain control of the agenda, rather than reacting to management imposition as they have done in the past.
Capital will continue to evolve and if trade unions do not change their structures then there is a possibility that they will become increasing irrelevant.
Charles Darwin said: “It is not the strongest of the species that survive, or the most intelligent, but the ones most responsive to change.” Logistic workers have already demonstrated that they are responsive to change. The challenge for the transport trade unions, nationally and internationally, and their global union federations is that they must also become more responsive to the changes in logistics; if not, then they risk the possibility of becoming extinct.
Roger Sealey is a transport researcher for the Transport & General Workers’ Union section of Unite, but is writing in a personal capacity.
Issue 35 - April 2009
Other pages for Issue 35 - April 2009:
On track for equality | Gaza relief effort | Climate change | Hebei Two campaign | Murder at sea | Young workers | European Works Council | Book review | Leading by example | Working life | In this issue
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