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Uneven Development, Job Cuts, and the Crisis of Labour Under Global Capitalism

Uneven development is a fundamental law of capitalism. We have a macroscopic expression of this in the changing balance of power between States: Atlantic decline and Asian rise are the key dynamics behind the political processes of this era, including wars caused by the crisis in the world order. But behind all this there is a differentiated economic trend, starting from companies and sectors: hence the differentiated conditions for wage earners. And this is the element to keep in mind for an effective defensive struggle.

It’s only the beginning

The electrical and digital restructuring imposed by global market competition affects various production sectors. The car industry is the most obvious, due to the familiarity of the companies and brands involved. We have already reported on the agreement reached before Christmas at Volkswagen, which can be summarised as a reduction of 35,000 employees by 2030. Die Zeit [December 24th] commented that with this agreement, “the largest car manufacturer on the continent, and for a long time also the most self-confident, will in future be just an ordinary manufacturer”. A serious blow to the illusion that it would be possible to overcome the difficulties of the market with co-management, of which VW was an emblem.

The tough fight that ensued could do no more than try and limit the damage. But it’s far from over. VW’s management is back on the offensive: those who believe the savings obtained from the measures are insufficient and are hoping for new cuts have increasingly been making themselves heard. They feel they have the support of the Porsche-Piëch family, who have the majority of votes on the board of directors and who, even before the agreement, had asked for a larger scale downsizing. Meanwhile, new confrontations are brewing in the group: Audi intends to close a site in Belgium and to reduce salaries in Germany; Porsche plans to cut 1,900 jobs, 5% of its German workforce.

Two faces of restructuring

The automotive components sector is the most affected by the transformation, on two counts: electric cars require fewer components; and the component manufacturers who have moved to supplying the new engines are suffering due to a weaker market for electric cars than expected. According to a report by CLEPA, the European components association, 30,000 jobs in the supply chain have already been lost in 2024 [Financial Times, January 3rd]. In Germany alone, Europe’s leading automotive power, 50,000 jobs have been lost in the sector since 2019.

Bosch has already announced the elimination of 12,500 jobs and “the management is not ruling out more” [Handelsblatt, February 3rd]. Here too there is opportunity for reflection about the nature of capitalism, given that Robert Bosch, who founded the company at the end of the 19th century, was nicknamed “Red Bosch” because of his attention to social progress: he was among the first in Germany to introduce the eight-hour working day. The market destroys all illusions.

The car industry is not the only sector affected by global restructuring. In Italy, one of the sectors most directly involved in and overwhelmed by the changes is household appliances: it was a strong point of the national economy during the years of the “economic miracle”, but today it suffers from the “economic miracles” of other countries. Famous brands have been taken over by foreign groups: Zanussi by the Swedish Electrolux, Candy by the Chinese Haier, most recently Ignis by the Turkish Beko, and so on. Here, uneven development shows both its faces: while employees in Italy have to fight to defend their jobs, their Turkish colleagues are fighting for big wage increases in the face of uncontrolled inflation.

Market, not plan

Despite all of this, even in Italy, alongside the many company crises, there are sectors and companies that are hiring. Accenture, a strategic consulting firm with 24,000 employees in Italy, plans to hire 4,000 people; Engineering, a digital transformation company with 10,500 employees, is looking for 900; Ansaldo Energia plans to hire 200 people in 2025; and even Stellantis intends to hire 300 engineers in Europe, including 100 in Italy.

The growing labour shortage shows that it’s not only highly qualified workers that are in short supply. The president of Confindustria, Emanuele Orsini, warns that 100,000 more workers are needed “already today”, with an implicit reference to the need to increase the flow of immigrants [la Repubblica, January 26th].

Expecting everything to rebalance simply by moving workers from one sector to another is a hope that, if not completely vain, would certainly require a long time to be realised, and is of little comfort for those concerned. There are examples of this: Hensoldt, a large German armaments group, due to a shortage of personnel to deal with a growing number of orders, has offered to hire about 200 workers laid off by car component groups such as Bosch and Continental [Financial Times, February]. But this is a transition that doesn’t bode well for humanity, given that those products will end up being sold on the “market” of military conflicts.

Contractual fragmentation

Then there is another aspect of uneven development that directly concerns our class: wage differences. These are not always due to objective conditions but often reflect the weakness of unions. For example, national contracts play a significant role in trying to keep up with inflation. But on this point Italy is clearly lagging behind: at the end of 2024, according to ISTAT, half of all workers were still waiting for their collective agreements to be renewed. The average waiting time, although decreasing, is 22 months, almost two years after expiry.

An essay published in March 2024 in the economics magazine Moneta e credito highlights contractual fragmentation, not only due to the proliferation of so-called “pirate contracts”, but also due to those signed by the CGIL, CISL, and UIL confederal trade unions: the 209 contracts signed by these organisations involve an average of 64,000 employees each; even for the eleven largest manufacturing contracts, the average only rises to 334,000. The conclusion is that, given these numbers, “the necessary contractual strength for the unions to fulfil their role as wage authority” is lacking. Furthermore, the idea that the unions’ objective should be simply to adjust wages for inflation “leads to a continuous ’victory’ of capital over labour”, since capital is then “the only one to benefit from technological and productivity improvements”.

Class unity and independence

What can we deduce from this brief overview? First, that the union struggle must be broad enough to be able to use the strength of the most advantaged components of our class to best defend those in a weaker position. From this point of view, the centrality of national contracts is decisive: merely extending company bargaining would accentuate fragmentation. It is therefore necessary to concentrate on the contractual disputes that are still open, without dissipating our energies.

At the same time, we must beware of the corporate, nationalist, and Europeanist appeals that are always lurking. The “we’re all in the same boat” perspective tends to identify the interests of the workers with those of capital and is unfortunately also present in the trade unions. To avoid being dragged into social imperialism and protectionism, workers must reject this perspective.

Ultimately, it must be recognised that this is the nature of capitalism: the union struggle can, if well directed, smooth out the roughest edges but not pave over what is a contradictory reality. The struggle for communism is the necessary path.

Lotta Comunista, February 2025
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