tag:theconversation.com,2011:/uk/topics/unionised-workers-24805/articlesunionised workers – The Conversation2017-02-17T03:21:28Ztag:theconversation.com,2011:article/731292017-02-17T03:21:28Z2017-02-17T03:21:28ZWork councils could be the future of Australian industrial democracy in an ABCC world<figure><img src="https://images.theconversation.com/files/157080/original/image-20170216-27421-1f9vi8j.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">The ABCC’s reintroduction has little to do with reforming the building and construction industry.</span> <span class="attribution"><span class="source">AAP/Dave Hunt</span></span></figcaption></figure><p>Work councils are one model of industrial relations that could potentially fill the enormous gap in Australian industrial democracy left by precarious employment and the decline of the union movement.</p>
<p>Canberra was once again the scene of further blows against construction workers and their union when the federal government this week <a href="http://www.aph.gov.au/Parliamentary_Business/Bills_LEGislation/Bills_Search_Results/Result?bId=r5806">passed legislation</a> to <a href="http://www.abc.net.au/news/2017-02-08/government-negotiates-deal-with-derryn-hinch-on-abcc-laws/8251100">hasten the onset</a> of laws linked to the <a href="https://theconversation.com/restoring-the-construction-watchdog-abcc-experts-respond-69643">Australian Building and Construction Commission</a> (ABCC).</p>
<p>In something of a one-two combination for the Australian union movement, the ABCC’s return accompanies <a href="http://www.smh.com.au/national/trade-union-membership-hits-record-low-20151027-gkjlpu.html">reports</a> that national union coverage has dwindled to its lowest ebb. Union membership now stands at around 15%.</p>
<p>In Australia, the growth of casual jobs outstrips the creation of permanent jobs by nearly <a href="http://www.abs.gov.au/ausstats/abs@.nsf/mf/6202.0">two to one</a>. Such precarious employment prevents workers putting down roots in their workplace, joining a union or engaging in enterprise bargaining. </p>
<p>The wane of the union movement need not sound its death knell, nor the end of collective bargaining. So long as there is work, there is a future for the rights of workers and unions. But such a future in Australia may look very different to the current industrial relations landscape. </p>
<h2>What is a work council?</h2>
<p>A work council is basically a “shop-floor” panel of employers and employees that convenes to negotiate and <a href="https://en.wikipedia.org/wiki/Codetermination_in_Germany">co-determine</a> labour and business relations within a company. </p>
<p>Co-determination has flourished in Germany since the late 19th century. More recently, the European Union has embraced work councils. </p>
<p>Since <a href="https://books.google.com.au/books/about/Social_Institutions_and_Economic_Perform.html?id=R1HtAAAAMAAJ&redir_esc=y">their implementation</a> across Europe, work councils have overseen increases in production and decreasing industrial disputation while affording workers a seat at the bargaining table, alongside unions.</p>
<p>In practice, work councils rely upon civic participation by workers within their workplaces to collectively negotiate their rights with employers, with or without union presence. In most cases, union representatives are present at negotiations. And yet personal participation in work council meetings has increased union membership.</p>
<h2>Could it work in Australia?</h2>
<p>At the heart of this model is a shift from an adversarial system of industrial relations to one based upon co-operation and social partnership between labour, capital and government.</p>
<p>Over the course of the 20th century, German manufacturing firms such as Mercedes-Benz, BMW and BASF yielded impressive profit margins by adopting the work council model.</p>
<p>Mercedes-Benz <a href="http://www.yesmagazine.org/issues/the-end-of-poverty/why-are-bmw-and-mercedes-so-rich">has taken</a> a long-term view of the benefits of co-operation between management and workers. As part of this compromise between workers and the company’s bottom line, trade unions and workers have increased productivity, exercised wage restraint and reined in union militancy. In exchange they have received enhanced workplace safety, small pay increases and protection of jobs from mechanisation. </p>
<p>A work council model for Australia was <a href="http://www.federationpress.com.au/bookstore/book.asp?isbn=9781862874442">originally proposed</a> by the Evatt Foundation and then discussed by industrial relations scholars and labour lawyers some 15 years ago.</p>
<p>Work councils are not without their faults, however. It is precisely the system’s “co-operative” nature that <a href="http://ro.uow.edu.au/cgi/viewcontent.cgi?article=1044&context=commwkpapers">may not transplant</a> easily from Europe to Australia. If the past 20 years of industrial relations in Australia demonstrate anything, it is that employers and the federal government have consistently and radically tipped the balance in the industrial framework toward employers.</p>
<p>Nevertheless, there are a <a href="http://www.federationpress.com.au/bookstore/book.asp?isbn=9781862873469">range of examples</a> from the 1990s in which similar arrangements to work councils were tried and tested on Australian construction sites. Results were equally successful to those in Germany.</p>
<p>The framework of the impending ABCC legislation would not legally impede implementation of work councils in Australia. But the ABCC will do nothing to promote the kind of mutual trust, respect and agreement between workers and management that a co-determinist system requires.</p>
<p>The 2006 <a href="http://www.austlii.edu.au/au/cases/cth/HCA/2006/52.html">WorkChoices case</a> led to a major shift in the constitutional underpinnings of the Australian industrial relations system. Previously, it relied on arbitration and conciliation, or the <a href="http://www.austlii.edu.au/au/legis/cth/consol_act/coaca430/s51.html">labour power</a>, which was a federalist model in which the states retained separate industrial jurisdictions. It shifted to a system underwritten by the <a href="http://www.austlii.edu.au/au/legis/cth/consol_act/coaca430/s51.html">corporations power</a> – a centralised system in which the Commonwealth unified labour law.</p>
<p>While WorkChoices was abolished in 2009, the centralised constitutional framework remained.</p>
<p>Well before 2006, however, advocates of industrial democracy such as Professor Ron McCallum <a href="http://www.federationpress.com.au/bookstore/book.asp?isbn=9781862874442">suggested that</a> in a climate of diminishing unionisation, the work council model might do well – if it were centralised and built into the workings of Australian companies through the corporations power. </p>
<p>Accordingly, the existing Australian constitutional legal framework is now ripe for the introduction of a work council system.</p>
<p>As unions and workers are increasingly stripped of their power in Australian workplaces, the spirit of a fair go will not simply disappear through harsh industrial legislation. It must be channelled somewhere. Whether that happens through an increasingly under-represented system of enterprise bargaining, or something like the German model of work councils, remains to be seen. </p>
<p>But a major shift to a model that benefits all parties, such as the work council system, will only happen with the utmost co-operation of Australian workers, unions and – most crucially – employers.</p><img src="https://counter.theconversation.com/content/73129/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Eugene Schofield-Georgeson is a member of the National Tertiary Education Union (NTEU).</span></em></p>A major shift to an industrial relations model that benefits all parties will only happen with the utmost co-operation of Australian workers, unions and – most crucially – employers.Eugene Schofield-Georgeson, Lecturer, UTS Law School, University of Technology SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/567902016-03-24T10:07:22Z2016-03-24T10:07:22ZHow to transform workers’ campaign rage into better jobs and wages<p>The presidential campaigns deserve some credit for finally voicing some of the deep frustrations and anger felt by American workers who have lived for decades in an economy that works for those at the top but not for them and their families. </p>
<p><a href="https://theconversation.com/america-doesnt-just-need-a-raise-we-need-a-new-national-norm-for-wage-growth-46831">Thirty years of wage stagnation</a>, the <a href="http://www.epi.org/publication/manufacturing-job-loss-trade-not-productivity-is-the-culprit/">loss of one-third of the nation’s manufacturing jobs since 1970</a>, a <a href="https://theconversation.com/how-do-we-ensure-the-next-generation-of-workers-isnt-worse-off-than-the-last-52110">failure to generate enough quality jobs</a> and career opportunities for young workers and unacceptable levels of income inequality are now coming home to roost. </p>
<p>It is not surprising that the angriest voices are coming from working-class men and young people who have entered the workforce in the last decade, the <a href="http://www.epi.org/publication/ib327-young-workers-wages/">two groups that have lost the most ground</a> and feel they have no one standing up for them and no control over their future. </p>
<p>And one of the main reasons for these trends is largely missing from the campaign trail: the loss of bargaining power and any means of having a voice at work. </p>
<p><a href="http://www.bls.gov/news.release/union2.nr0.htm">Unions now represent only about seven percent</a> of the private sector workforce, and recent attacks on public sector unions are now leading to their decline as well. The Supreme Court will soon decide whether or not to <a href="https://theconversation.com/attack-on-unions-shows-why-we-need-a-new-social-contract-governing-work-52884">further weaken public employee unions</a> by eliminating rules requiring nonmembers to pay their fair share of the costs to represent them. </p>
<p>But angry rhetoric will not put the economy on a path that works for the disaffected and disenfranchised. Instead we need to address the root causes of workers’ frustration and their economic decline. And to do that, I would argue, we need to fix our broken labor policy. </p>
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<h2>Decline of unions</h2>
<p><a href="http://www.asanet.org/images/journals/docs/pdf/asr/WesternandRosenfeld.pdf">Recent studies estimate</a> that 20 percent or more of the current wage inequality is due to the decline of unions and worker bargaining power. </p>
<p>But perhaps because of the public’s ambivalence toward unions, none of the candidates has laid out a strong and positive vision or strategy for rebuilding workers’ bargaining power in ways that fit what they want now or that can be successful in today’s economy. </p>
<p>Any strategy for rebuilding bargaining power has to start with fixing a broken labor law that no longer provides workers access to collective bargaining. Today, if management resists worker efforts to organize (and they nearly always do), <a href="http://edworkforce.house.gov/uploadedfiles/4.30.10_ferguson.pdf">less than one in 10</a> union organizing efforts results in a collective bargaining agreement. </p>
<p>The odds are so stacked against workers and unions that few see trying to organize as a viable option.</p>
<p>The ways to fix this aspect of labor law are well-known: strengthening penalties against employers or unions that violate the law, shortening the time required to hold an election to determine if a majority votes for union representation and having a neutral arbitrator set the terms of the first contract if one party or the other stonewalls the process.</p>
<h2>Labor management partnership</h2>
<p>But these reforms have been impossible to get through Congress in the past, and as stand-alone proposals will be equally difficult in the future. </p>
<p>They need to be combined with provisions that promote the forms of worker-management relations that have demonstrated their value in generating and fairly sharing productivity and economic growth. It’s also important that they support the new ways workers are finding a voice. </p>
<p>The labor-management partnership in place for nearly two decades at health care provider Kaiser Permanente, for example, is a model for the type of modern labor management relationship. It both promotes improvements in patient care and organizational performance and ensures workers share fairly in the economic savings they help generate. </p>
<p><a href="http://www.amazon.com/Healing-Together-Labor-Management-Partnership-Permanente/dp/0801475465">Our research group</a> tracked the evolution of this partnership from its inception. <a href="http://mitsloan.mit.edu/uploadedFilesV9/Academic_Groups/Work_and_Organization_Studies/Media/FINAL-KPreport130947.pdf">We found</a> that Kaiser Permanente is a leader in use of union-management sponsored front-line teams that focus on improving health care delivery, a leader in use of electronic medical records to keep people healthy and out of hospitals, and pays industry leading wage and benefits. </p>
<p>Ford, the only U.S. car company that avoided a government bailout, has a <a href="http://www.amazon.com/Inside-Ford-UAW-Transformation-Pivotal-Delivering/dp/0262029162/ref=sr_1_fkmr1_1?s=books&ie=UTF8&qid=1458766158&sr=1-1-fkmr1&keywords=Cutcher+Gershenfeld+Ford+partnership">similar partnership</a>, which <a href="http://www.aflcio.org/Blog/Organizing-Bargaining/Stronger-Together-Labor-and-Management-at-Ford">helped it recover</a> from losing US$17 billion in 2006 to making $7.4 billion and paying each union member $9,300 in <a href="http://www.detroitnews.com/story/business/autos/ford/2016/01/28/ford-earnings/79448532/">profit sharing</a> in 2015.</p>
<p>A modernized labor policy should encourage such partnerships fitted to the needs of different industries and occupations.</p>
<p>Modernizing labor law also will require extending protections against discrimination and opening it up to people working in the diverse array of organizational settings today, not just the nonsupervisory employees in traditional employment relationships currently covered by the 1935 vintage labor law. </p>
<p>A growing number of workers are employed in subcontractor or franchised arrangements (think McDonald’s) in which the employer who controls their work and future is unreachable. Those classified as independent contractors in the so-called platform or “gig” economy (think Uber drivers) are likewise excluded and have no legally protected means of organizing or engaging the executives who set their fares and control their access to customers. </p>
<p>All these groups need protection from discrimination if they try to mobilize and seek to negotiate with whoever sets their terms and conditions of employment.</p>
<h2>Keeping up with the times</h2>
<p>A forward-looking labor policy will also need to recognize and support the many innovative initiatives under way that are attempting to help workers who prefer to move to a better employer when faced with unfair or unacceptable practices at their current workplace. </p>
<p>Indeed, a growing number of “apps” are coming along that support worker mobility. Examples include those being incubated through the <a href="http://theworkerslab.com">Workers Lab</a>, <a href="https://turkopticon.ucsd.edu">Turkopticon</a> for those choosing who to work for on Amazon’s Mechanical Turk and <a href="https://www.sherpashare.com">Sherpashare</a> and other groups providing drivers comparative information on earnings opportunities at Uber, Lyft and other platforms. </p>
<p>Further experimentation with these innovative efforts will test the viability of using information and transparency as new sources of worker power. Those experimenting with these new approaches deserve to be protected from discrimination for raising their voice. </p>
<p>I would go further and open up the law to encourage experimentation and evaluation of these emerging efforts. Let these worker entrepreneurs show us new ways to harness technology in support of today’s workforce.</p>
<h2>Shaping the future of work</h2>
<p>I believe that American workers are thirsty for a positive vision and strategy that restores workers’ ability to have a constructive voice at work and that provides enough real power to regain a voice in shaping their future. </p>
<p>So it is time for those who seek their support to abandon the divisive and negative rhetoric that feeds their frustration and instead propose a viable way forward. Perhaps the best way to invent the next generation labor policy is to listen to workers themselves talk about what they want, need and are trying to do to regain control of their destiny at work. </p>
<p>So let me end with an invitation: we will be taking up these and other issues in how to Shape the Future of Work in an <a href="https://www.edx.org/course/shaping-future-work-mitx-15-662x">MITx online course</a> starting next week. Join us in this course and see what real workers – young, midcareer and beyond – are saying about their visions for the future of work and the future of worker representation. </p>
<p>This is just one way we can deliver their message to the candidates desperate to gain their support. </p>
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<p class="fine-print"><em><span>Thomas Kochan does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Presidential candidates are using voter anger to fuel more divisions and discord rather than to start a conversation about the collapse of collective bargaining.Thomas Kochan, Professor of Management, MIT Sloan School of ManagementLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/542692016-02-19T03:59:18Z2016-02-19T03:59:18ZSouth Africa’s civil servants are the country’s new labour elite<figure><img src="https://images.theconversation.com/files/111470/original/image-20160215-22560-py11bi.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Public sector trade unions now dominate union membership in South Africa.</span> <span class="attribution"><span class="source">Reuters/Siphiwe Sibeko</span></span></figcaption></figure><p><em>Foundation essay: Our foundation essays are longer than usual and take a wider look at a key issue affecting society.</em></p>
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<p>The rise of public sector employment in South Africa has a much greater potential import than the private sector for the future trajectory of the economy’s employment path. We find that a key new facet of the South African labour market is an estimated wage wedge between unionised public sector workers and other formal non-agricultural workers in the labour market.</p>
<p>The total number of public sector employments increased from 2.16 million in 2008 to 2.69 million at the end of 2014. Public sector employment’s share of total jobs had risen to 17.5% by the end of 2014, up from 14.5% at the beginning of 2008. The growth was driven by employment in national, provincial as well as local government.</p>
<p>The fastest period of public sector employment growth was during 2009, immediately following the global financial crises. This suggests that the state possibly acted as an unintended creator of jobs during a period of extreme labour market distress.</p>
<h2>Who is being hired?</h2>
<p>The large contributors to public sector job growth are occupations that fall under the category of unskilled workers. These include sweepers, farmhands and labourers, helpers and cleaners, construction and maintenance labourers, and garbage collectors.</p>
<p>The other major contributors are medium-skilled workers. These are police and traffic officers, institution and home-based care workers, other protective services, prison guards, technikon teacher training, cooks and childcare workers.</p>
<p>Higher-skilled jobs such as primary and secondary school teachers, finance and administrative managers and legislators have also contributed to public sector job growth.</p>
<p>It would seem that the government’s Expanded Public Works Program is an important driver of public sector job creation. Launched in 2004, it focuses on providing income relief through creating jobs for the unemployed and unskilled that involve socially useful activities.</p>
<p>The programme creates jobs through government funded infrastructure projects. It does this through non-profit organisations and community work programs, as well as public environment and culture programs. As such, much of the public sector job growth relates to the construction industry, the protection and safety sector, public sanitation and personal care industries.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/111963/original/image-20160218-1274-1wnomrt.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/111963/original/image-20160218-1274-1wnomrt.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=399&fit=crop&dpr=1 600w, https://images.theconversation.com/files/111963/original/image-20160218-1274-1wnomrt.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=399&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/111963/original/image-20160218-1274-1wnomrt.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=399&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/111963/original/image-20160218-1274-1wnomrt.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=502&fit=crop&dpr=1 754w, https://images.theconversation.com/files/111963/original/image-20160218-1274-1wnomrt.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=502&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/111963/original/image-20160218-1274-1wnomrt.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=502&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Higher-skilled jobs, among them legislators, also contributed to public sector job growth.</span>
<span class="attribution"><span class="source">Reuters/Rodger Bosch</span></span>
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<h2>More representative</h2>
<p>The public sector has clearly been able to transform its labour force at a faster pace than the private sector. It has hired a higher proportion of both women and African workers in the sector, groups that were discriminated against under apartheid.</p>
<p>Africans make up 77% of public sector employment compared with 66% the private sector. Females make up 52% of the workforce, compared to 44% in the private sector.</p>
<p>In terms of the skills profile, the public sector is more skills intensive. Almost 45% of all public sector employees fall into the top three occupational categories, compared to 26% in the private sector. Both sectors, however, have a similar proportion of unskilled workers. This indicates that private sector workers are concentrated in the medium-skilled occupations.</p>
<p>Interestingly, the proportion of the two most skills-intensive occupations did not change in the public sector between 2008 and 2013, but the proportion of professionals in the private sector increased by 25%. This is consistent with the shift towards more skilled workers.</p>
<p>Growth in public sector jobs was driven by the medium-skilled occupation of service workers, as well as in elementary occupations. The share of medium-skilled workers grew by 31% and and elementary occupations by 23%.</p>
<p>Again, this may point to the state being able to absorb excess unskilled and medium-skilled labour at times of economic and labour market distress.</p>
<h2>Bargaining power</h2>
<p>Another feature of the public sector labour market is the relatively higher rate of unionisation, which is often associated with a wage premium. Union members made up almost 70% (1.4 million workers) of all public sector’s formal workers in 2014, up from 55% in 1997 (834,000 workers).</p>
<p>This compares with the private sector where union density declined from 36% in 1997 to 24% in 2013. Unlike in the public sector too, the absolute number of private sector unionised workers has remained fairly constant.</p>
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<img alt="" src="https://images.theconversation.com/files/111471/original/image-20160215-22560-r0k9n1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/111471/original/image-20160215-22560-r0k9n1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=370&fit=crop&dpr=1 600w, https://images.theconversation.com/files/111471/original/image-20160215-22560-r0k9n1.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=370&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/111471/original/image-20160215-22560-r0k9n1.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=370&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/111471/original/image-20160215-22560-r0k9n1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=466&fit=crop&dpr=1 754w, https://images.theconversation.com/files/111471/original/image-20160215-22560-r0k9n1.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=466&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/111471/original/image-20160215-22560-r0k9n1.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=466&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Public sector labour market is relatively more unionised.</span>
<span class="attribution"><span class="source">Reuters/Mike Hutchings</span></span>
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<p>The rise in public sector unionisation is commensurate with the increase in public sector employment. Public sector trade unions now dominate union membership in South Africa.</p>
<p>Powerful labour unions are often associated with creating a wage premium for their members. This is based on their ability to mobilise industrial action and negotiate in favour of their members during times of wage negotiations. There is extensive literature on the union wage gap in South Africa, but slightly fewer studies on the bargaining council premium.</p>
<p>Taking account of this, we found that:</p>
<ul>
<li><p>union members outside of the bargaining council system earned a premium of 7.04%; and</p></li>
<li><p>those members of private and public bargaining councils not belonging to unions earned an 8.97% and 10.5% premium over non-union workers outside of the bargaining council system.</p></li>
</ul>
<p>The total estimated premium to union workers within the public bargaining council stands at 22%. Therefore, there is evidence that belonging to either unions or bargaining councils is associated with statistically significant wage premia. Furthermore unions may negotiate at the plant level for additional gains for their members within the bargaining council system.</p>
<p>When comparing wage levels, both the median and mean wages of the public sector are significantly higher than private sector’s. The real monthly wage of an average public sector employee is R11,668 (US$1209) compared to R7,822 (US$811) for an average private sector worker. In addition, public sector wages have less dispersion than private sector wages, indicating a lower level of wage inequality within the public sector.</p>
<p>Most importantly though, non-unionized public sector workers are concentrated in elementary occupations (30%), service and sales occupations (16%), and technical and associate professional occupations (16%). While it remains uncertain, the non-unionised workers in the first two occupational groups are likely to be those employed under the public works program.</p>
<h2>More nuanced labour market view</h2>
<p>Ultimately though, these wage distributions suggest that, at least in terms of earnings, a dual labour market may indeed be prevalent in the South African labour market. Previous models of segmentation have commonly referred to the distinction between the employed and the unemployed. More recently the formal and informal sector has been used as the key identifying segmentation markers.</p>
<p>We suggest a nuance to South Africa’s segmented labour market.</p>
<p>In particular it would appear that the distinction between public and private sector, in terms of earnings and employment, is a new form of segmentation which has evolved in the post-apartheid South African labour market.</p>
<figure class="align-right ">
<img alt="" src="https://images.theconversation.com/files/111473/original/image-20160215-22545-1frdppp.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/111473/original/image-20160215-22545-1frdppp.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=852&fit=crop&dpr=1 600w, https://images.theconversation.com/files/111473/original/image-20160215-22545-1frdppp.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=852&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/111473/original/image-20160215-22545-1frdppp.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=852&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/111473/original/image-20160215-22545-1frdppp.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=1071&fit=crop&dpr=1 754w, https://images.theconversation.com/files/111473/original/image-20160215-22545-1frdppp.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=1071&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/111473/original/image-20160215-22545-1frdppp.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=1071&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Unionised public sector workers earn a premium as high as 20.7% over private sector colleagues.</span>
<span class="attribution"><span class="source">Reuters/Mike Hutchings</span></span>
</figcaption>
</figure>
<p>Our econometric results show that for unionised workers, the public sector wage premium is 20.7%. In particular, for government workers in the public sector, the wage premium within the group of workers belonging to a union, is 23.5%, whereas there is no significant wage premium for employees of state owned enterprises.</p>
<p>Given the rising membership of public sector unions, together with the growing political influence of these unions, these results possibly allude to the role played by unions in driving higher returns for their members in the post-2000 period. This pattern of wage returns potentially suggests segmentation between unionised public sector workers versus all other formal, non-agricultural workers.</p>
<p>In one conception, we could argue that the post-2000 period has generated new labour elite in the labour market, namely the unionised public sector employee.</p>
<hr>
<p><em>This article is an extract from a <a href="https://www.wider.unu.edu/publication/demographic-employment-and-wage-trends-south-africa">working paper</a>, which is part of a <a href="https://www.wider.unu.edu/project/understanding-african-lions-growth-traps-and-opportunities-six-dominant-african-economies">collaboration</a> between UNU-WIDER, the Brookings Institution and the Development Policy Research Unit (DPRU) at the University of Cape Town on Understanding the African Lions: Growth Traps and Opportunities in Six Dominant African Economies.</em></p>
<p><em>Since the publication of the working paper Kavisha Pillay has resigned from the Development Policy Research Unit (DPRU) at the University of Cape Town</em></p><img src="https://counter.theconversation.com/content/54269/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Haroon Bhorat receives funding from various government departments. </span></em></p><p class="fine-print"><em><span>Karmen Naidoo and Kavisha Pillay do not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Rising membership of public sector unions and the growing political influence of these unions have led to government workers earning a premium over their private sector counterparts.Haroon Bhorat, Professor of Economics and Director of the Development Policy Research Unit, University of Cape TownKarmen Naidoo, Senior Researcher, Development Policy Research Unit, University of Cape TownKavisha Pillay, Junior Researcher, Development Policy Research Unit, University of Cape TownLicensed as Creative Commons – attribution, no derivatives.