 |
Labour and Society Programme
DP/126/2001
ISBN 92-9014-640-0
First published 2001
Trade union responses to globalization: Chile
By
Guillermo Campero
Download PDF Version
|
| Trade union responses to globalization: Chile |
 Summary
Glossary
Chapter I. Structural change in the seventies and eighties, Chile enters the process of globalization against an authoritarian political background
1. The initial restructuring stage (1973-1981)
 1.1. The impact on the trade unions' social base
1.2. The impact on the constituents of trade unionism: membership and trade union organization in the period 1973-1981
1.3. Summary of the processes in the period 1973-1981
2. The economic crisis of the early eighties, the recovery and consolidation of the current economic development model (1981 and the decade of the nineties)
2.1. The crisis
2.2. The recovery of the economic model
2.3. The social base of trade unionism in the nineties: structure and major features of the workforce and employment.
2.4. Summary of the background to the social base of trade unions in the nineties
2.5. Trade unionism in the nineties and its composition: organization and membership
Chapter II. Trade union responses to globalization in Chile in the nineties: democracy and development
1. Policies and strategies directed towards global issues
1.1. Social cohesion
1.2. Policies aimed at institutionalizing labour and social security
1.3. Policies aimed at participation and promotion of social rights in economic and social development
1.4. Balance of global policies
2. Policies at company union level
2.1. Policy of strategic agreements in companies in key sectors
2.2. Policy on productivity agreements at company level
2.3. Policy of agreements on vocational education and training
2.4. Summary of company level policies
3. An overview of labour relations
Chapter III. Conclusions
1. The new directions of social and economic development: impact on the traditional model of trade union action
2. Tensions from changes in the traditional model of trade union action
3. Prospects and challenges for the construction of a new model of action
Bibliography
List of Tables
Average employment and added value by industrial branch
Total members, for selected years
Trade unions and dependent members
Index of trade unions and members 1970-1977
Distribution of trade unions, as a percentage, by size, branch and selected years
Employed persons by branch of activity, total country
Employed persons by branch of economic activity
Total trade unions and membership at national level
Unionized workforces by sector
SUMMARY
Unlike other Latin American countries where the trade union movement tackled the challenges of globalization as progressive
adjustments deriving from economic and political modernization in a democratic framework, in Chile this process of major change
was the result of violent, drastic and massive adjustment by an authoritarian government, which denied political or social freedoms
and was overtly anti trade union. Thus, for Chilean trade unionists, the processes related to globalization and its structural effects
were experienced simultaneously with the political and social effects generated by the military government. Consequently, the
struggle to restore political democracy in Chile, in which trade unionists were the leading players, was often also linked with
criticisms of the new economic model, since it was considered that the authoritarian military regime and the new model were two
sides of the same coin.
Initially, during the 70s, the changes resulting from the introduction of the new economic model by the military regime had a high
social cost, including falling wages and unemployment, and were reflected more generally in an all-round weakening of the structural
setting in which trade unions could exist and act. Not only did the total number of members decline, as a result of high
unemployment, but also there was a fragmentation of trade union organization as unions declined in size. In short, both the structural
impact resulting from the economic model adopted and the political constraints, which stultified union development, produced a
regression in trade union activity and a drastic change in the composition of its social base. This situation can be regarded as critical
since the process of weakening was global and new sectors did not emerge to strengthen and counteract the decline in historically
more strategic centres. Also of crucial importance was the application of highly flexible and deregulatory labour legislation, which
imposed serious restrictions on trade union action. Despite that, it did not mean the demise of organized labour.
The situation began to change in the 1980s, when the trade unions headed a vast social protest movement against the military regime
and its policies, leading a social base wider than that organized in trade unions. However, this trade union leadership was overtaken
by party leaderships and its new profile as the cement for a wider social spectrum lost ground and finally disappeared.
Analysts agree that 1985 was when the foundations of the present Chilean economic process were laid, since it marked the beginning
of a decade of economic growth and permanent job creation. An essential factor, political stability, began to emerge with the end of
the authoritarian military government in 1990, opening up areas suited to social action. In the case of trade unionism, one of the
significant effects was the rapid growth in membership during the first three years of democratic government, even though the
average size of trade unions tended to decrease.
At this stage, trade union strategy in Chile was characterized by three lines of approach: social cohesion, legal reform and
participation in national decisions. In the case of the first, it should be noted that the policies designed to strengthen social alliances
were aimed at establishing a general framework to tackle the employment issue with the start of the first democratic government for
17 years. The signing of the National Tripartite Framework Agreement in May 1990 was the first outcome of that approach, and an
unprecedented event in Chilean experience. Its principal value was to send a signal that the trade unions, employers' organizations
and the Government were ready to agree the broad lines of economic and social development, as well as the will of the parties to
regard them as a framework within which they were prepared to work. That signal, which helped to strengthen the stability of the
process of change to democracy, was the result of a process of mutual concessions by the parties, such that its content can be seen as
a kind of "memorandum of understanding" rather than full convergence. The following three Agreements were more limited, but kept
up the idea of social cohesion as a method of high social and political value. From 1994 onwards, however, the policy of national
agreements came to an end because the parties thought that it did not deliver the benefits for which they hoped. The policy was to
some extent replaced by the creation of the Productive Development Forum, a tripartite non-decision-making body which drew up a
major programme of work on various subjects linked to the public and private agenda for action on economic and social
development. The Forum succeeded in stimulating highly representative national debates. However, its importance declined after
1998 for reasons similar to those that had led to the demise of the national agreements.
Secondly, the trade unions concentrated on drawing up proposals aimed at the reform of existing labour legislation, especially
opening up greater opportunities for trade unionism and collective bargaining. Although important reforms were introduced from
1990 onwards, there are still many aspects, which continue to limit trade union action and workers' collective action in general.
Thirdly, trade unionists shifted to negotiating strategic long-term agreements in companies with a high social and economic strategic
value, with the objective of establishing a kind of compromise between the company management and the workers' organization to
achieve both the company's economic targets and a satisfactory level of labour relations. The trade unions were trying in that way to
show that in a globalized economy, a company could only compete successfully if the company as a whole tackled that competition
and if the workers felt that they were being properly rewarded. The best examples of the strategy were in two large state enterprises
and two in the private sector. In a more limited context than those alliances, company trade unions had also made significant efforts
to get the company management to negotiate with them on policies to increase productivity and to consider bonuses for the workers
when they achieved good results.
These three lines of approach to global issues adopted by Chilean trade unionism has meant that they are seen by the public as a
player with clear positions on issues of national interest, and thus surmount the position of weakness into which they had been forced
by the military government. However, the degree of involvement they have achieved does not seem to have allowed them to
strengthen their capacity for action at the level of their constituent social base.
Indeed, the evidence suggests a downward trend in membership and collective bargaining, that there are problems in representing the
new classes of workers, resulting from changes in the structure of the economy and patterns of employment, as well as technological
change, and that the influence of the trade union movement seems to be markedly less decisive in reaching major social, political and
economic decisions. This is because its traditional action model is undergoing reform and trade unionism is involved in a complex
process of renewal of its ideas and strategies, which naturally gives rise to tensions and uncertainties.
Our theory is that we are seeing the gradual replacement of collective trade union action by workers with another type of
trade union action and representation that is seeking to find a place in the new social, economic, technological and
institutional environment. This change is a complex process, involving major cultural reorganization, but there is no
evidence that trade union action has been replaced by individual action or that forms of representation other than trade
unions are emerging in the work place. Put another way, trade unionism is a crucial player in reaching a new consensus in the world of work.
A new model of trade union action
Briefly, we shall mention five emerging lines of action, which, it seems to us, will have an influence on the strategic and socio-political development of Chilean trade unionism in the future.
· A process of reflection is under way which seeks to identify a new programme of trade union action incorporating change, but
without abandoning the identity of the movement which represents a social class: the workers. It would allow retention of the trade
unions' adversarial role needed by society to act as a counterweight to economic forces and the power of the State.
· A vision more relevant to the relationships between the economic and social goals is being developed. In this new vision, mainly
driven by a younger leadership, trade unionism is trying to combine economic and employment policy, so that both promote
sustained growth and better distribution of profits, while also sharing constraints and opportunities.
· There is a growing acceptance that political will must be achieved through negotiation in order to reach stable views on economic
decisions. The idea that achieving a greater share of power and trade union participation is sufficient in itself to support decisions
appropriate to labour interests, is under review.
· A new culture of labour relations is emerging, giving new weight to action at company level as of great importance in dealing with
matters that concern both workers and employers. Even against a background of conflicts of interest, there are areas of collaboration
where the players can find common ground and establish a framework for dialogue.
· There is particular concern to develop forms of representation suited to the new economic, technical and social conditions. There is
a patent need to make leadership selection more democratic, with increasing attention to developing leadership at company level,
strengthening the trade union career path from the bottom up and generating greater decentralization so that local and regional
branches have greater power to negotiate at local level.
In general, decentralizing and diversifying the trade union structure, while still maintaining the links between its three traditional
levels (grass-roots, branch and national) appears to be a significant criterion that is emerging from the new debates. The biggest
challenge is to consolidate a stable institutional framework which combines adjustment to new forms of representation with a
growing technical expertise, able to shoulder the burden of federation-level and grass-roots action, especially in collective bargaining,
at the same time able to elaborate proposals on major national issues.
GLOSSARY
ANEF : Agrupació Nacional de Empleados Fiscales (National Association of Fiscal Employees)
CEPCH : Confederación de Empleados Particulares de Chile (Confederation of Individual Workers of Chile
CNS : Coordinadora Nacional Sindical (National Trade Union Coordinating Body)
CNT : Comando Nacional de Trabajadores (National Workers' Command)
CODELCO : Corporación Nacional del Cobre (National Cooper Corporation)
CPC : Confederación de la Producción y del Comercio (Confederation of Manufacturing and Trade)
CUT : Hasta 1973 Central Unica de Trabajadores
Refundada en los años 80 como Central Unitaria de Trabajadores
(Up to 1973, the Single Workers' Union, re-founded in the 80s as the Unitary Workers' Union)
ENAMI : Empresa Nacional de Minería (National Mining Corporation)
FUT : Frente Unitario de Trabajadores (Workers' United Front)
INE : Instituto Nacional de Estadísticas (National Institute of Statistics)
ILO : International Labour Organization
EAP : Economically Active Population
PEM : Minimum Employment Programme
GDP : Gross Domestic Product
POJH : Occupational Programme for Heads of Household
UDT : Unión Democrática de Trabajadores (Democratic Workers' Union)
UNTRACH : Unión de Trab
INTRODUCTION
This paper is intended to present the policies and strategies pursued by Chilean trade unionism in the nineties, facing challenges
caused by the profound economic and political structural changes resulting from the country's entry into a globalized world and an
equally globalized political system.
In order to study the case of Chile, it is essential to bear in mind that the process of integration of that country into the framework of
economic and political globalization occurred initially, in the early 70s, under a military government, which had overthrown a
democratic government in a coup d'état. The new government, which lasted 17 years, used authoritarian methods to implant an
economic model inspired by so-called neo-liberal ideas, introducing a system based essentially on regulation of the market, severely
limiting the State's role in the economy, privatizing a major part of the health and social security system, repealing the old Labour
Code, which was replaced by new legislation based on principles of greater flexibility and less labour protection. It drastically
opened up trade and finance to the international economy and focussed its development policies mainly on the export of
commodities. Politically, the military government shut down the Parliament, suspended the political parties and severely restricted
the activities of social organizations, especially the trade unions. That is why, for Chilean trade unionists, the process of globalization
and its structural effects was felt at the same time as the political and social effects generated by the military government. Unlike
other countries in the region where the trade union movement faced the challenges of globalization in a framework of political
democracy, in Chile those challenges were seen by trade unionists as processes linked to the actions of an non-democratic
government. Thus the struggle to restore political democracy in Chile, in which the trade unionist was the principal players, was often
also linked to combating the new economic model, since they regarded the authoritarian military regime and the new model as two
sides of the same coin.
This background needs to borne very much in mind, since its is an important factor in gaining a thorough understanding of the
meaning of trade union policies and strategies in the face of the processes arising from economic and political globalization in the
post-1990 period, when political democracy was restored to the country.
Moreover, the effects of the economic, political and institutional changes due to the country's experiences from 1973 onwards had
already been consolidated by 1990, so that the structural framework in which trade unionism developed at the beginning of the
decade had already been shaped several years earlier.
In particular, the economic and social conditions under which the trade unions were working in the nineties had been established in
the previous two decades. Trade unionism in the nineties and its social and material environment were not those of the early
seventies, although part of its national leadership was the same as then and even though its traditional organizational structures
continued in existence.
This process of major change marked trade unionism in Chile very decisively, because the changes which affected it were not the
result, as in other countries, of progressive adjustments due to economic and political modernization strategies in a context of
political democracy, but the consequence of a violent, drastic and massive adjustment led by an authoritarian government, which
denied social and political freedoms and was overtly anti-trade union.
For the reasons set out above, this study has been organized into three main chapters.
Chapter 1 is intended to show the process of economic, institutional and political change that took place from 1973 onwards and its
effects on trade unionism. Its aim is to understand the scale of the changes affecting the movement and which explain its defining
characteristics up to the nineties.
Chapter 2 focuses on trade union responses to the changes due to globalization, concentrating on the decade of the nineties, but
taking into account the background to events since the early seventies for the reasons explained above.
Chapter 3 contains the conclusions of the study, summarizing the salient points of the previous chapters, but above all it is an attempt
at a conceptual analysis of the trade union strategies in the face of change, followed by some propositions concerning the challenges
of the future.
CHAPTER I - STRUCTURAL CHANGE IN THE SEVENTIES AND
EIGHTIES, CHILE ENTERS THE PROCESS OF GLOBALIZATION AGAINST AN AUTHORITARIAN POLITICAL BACKGROUND
1. The initial restructuring stage (1973-1981)
1.1. The impact on the trade unions' social base
The changes that took place in the economic, occupational and wage structure during the period 1973-1981, as the result of the
implementation of an economic model involving a high degree of participation in the international scene and driven by market forces,
led to major changes in the structural environment in which trade unionism had been developing.
We shall devote this part to a concise but sufficiently detailed analysis so as to understand the magnitude of the changes that
occurred, since they are at the root of Chilean trade unionism today.
In the first place, there was a change in the social base that had provided the fundamental strength of the trade union movement in
past decades. It took the form of a decline in employment in the productive sectors (agriculture, mining, manufacturing and
construction) and rising employment in the service sectors (trade, services, transport and communications). While the share of the
former in employment fell from 49.9 per cent to 39.2 per cent between 1972 and 1980, the others increased their share from 50.1 per
cent to 60.8 per cent over the same period. Among the latter, it was the trade sector that showed the highest real growth. Transport
remained constant and there was a sharp fall in public administration. While some sectors in both areas had a high degree of formal
unionization, the trade unions in the productive sectors were the ones that generally had the most organized and mobilized base prior
to 1973.
Consequently, there was a reduction in the potential scope for development of the trade union movement which had hitherto been
more active politically and socially.
Secondly, from the point of view of its relative position in the economic fabric, GDP in the production sectors rose between 1974 and
1980 at 1.6 per cent while in the period 1960-1970 it had risen at a rate of 4.9 per cent. In turn, the rate of growth of GDP in the
service sectors rose from 4.4 per cent to 4.9 per cent for the same periods. That means that the former's percentage share of GDP fell
from 49.8 per cent in 1974 to 44.8 per cent in 1980, while at the same time the latter rose from 50.16 per cent to 55.8 per cent for the
same years.
Consequently, trade unionism's ability to exert economic pressure in the production areas also declined, and they thus carried less
weight in the economy as a whole.
In both processes, industry and construction, as the two most important sectors from the point of view of their traditional capacity for
trade union mobilization in an urban context, were the most affected, since the impact of the changes that occurred struck at the heart
of traditional trade union activity. Manual workers were particularly affected, since in 1970 they accounted for 63.4 per cent of the
EAP in the non-agricultural production sector, falling to 53.0 per cent in 1979. Office workers, on the other hand, were steady at
around 18 per cent during those years.
Finally, in terms of remuneration, both the productive and service sectors fell overall compared with 1972, with variations in the size
of the fall and subsequent recovery. Thus, the general wages and salaries index in 1980 was 89.9 per cent compared with the 1970
and a little under 70 per cent compared with 1972.
Consequently, against an overall background of economic impoverishment of the workers, the trade union sectors with the strongest
militant traditions saw their overall social recruitment base diminishing and their strategic position in the economy in decline.
Furthermore, considering that the dynamism of the service sectors, whose level of employment and position within the economy was
growing, was basically centred on trade and financial services, both very dispersed groupings, and that the civil service, the most
unionized of the service sectors, had been drastically cut, there were no effective conditions, in the short term, for bringing these
structural factors of potential trade union power into play.
Thus, the changes due to the application of the economic model were reflected, in more general terms, in an overall weakening of the
structural conditions for trade unions to exist and operate, without any change in the conditions to allow the "advancing" sectors to
mobilize any potential they might have.
Nevertheless, this general situation needs to be examined in more detail in relation to the production sector, the most important
nucleus of traditional trade unionism, since within the sector, the changes did not impact equally.
Indeed, although the sector was generally affected by the new economic model, not all activities suffered to the same extent. The
policy of opening up to international trade and entry into the global economy produced different results depending on the relative
capacity of each branch of industry to absorb the dynamics of the model.
Those areas with comparative export advantages were less affected by the chosen economic policy. Mining of metals, wood, paper
and cellulose, fruit-growing for export and fish products could quickly transfer to the external market surpluses not sold because of
constraints in domestic demand. These activities, linked to the exploitation of natural resources and with low levels of industrial
processing, were also encouraged by an export promotion policy which gave them credit facilities and tax exemptions. These
branches, which have little significance for employment patterns, showed strong patterns of growth during the period and were the
fundamental basis of the new model's growth strategy.
Secondly, there was a large segment of activities whose production was not transferable to the international market or where there
were restrictions on imports or exports. That was true of food products (vegetables, meat, etc.), the basic food processing industry,
drinks and tobacco, printing, some chemical industries, leather and footwear and plastic, extraction of minerals for construction, some
categories of basic metals and industrial inputs for construction being among the most significant. Those activities depended on
fluctuations in the pattern and volume of domestic demand. They were thus severely affected by the anti-inflationary policy pursued
and the recessionary consequences during much of the period in question. However, as the level of activity improved, some partly
recovered their previous dynamism, in response to changes in the pattern of domestic demand.
Several of those activities had a strong impact on employment. Despite that, their recovery was not enough to absorb the
unemployment generated in other sectors.
Lastly, a major group of productive activities, which did not possess comparative advantages, involving goods that could be
imported, were seriously reduced as a result of competition from imported goods. Chief among these were the bulk of non-food
consumer goods, such as textiles, mechanical and electrical goods, the majority of capital goods and a significant volume of basic
food products, such as cereals and sugar. In these categories, the level of activity fell drastically, many companies collapsed; others
shifted their production to assembly of imported goods or towards specific market segments. Companies in those areas also redirected
their activities to the import trade, abandoning many of their previous productive activities.
The most serious effect of the reduction in these activities was undoubtedly unemployment in industry and agriculture. Their decline,
despite everything, did not prevent them continuing to hold a dominant position in the employment structure. However, the
elimination of tariffs and the continuing decline in the competitiveness of these industries, caused by maintaining a fixed rate of
exchange with domestic inflation much higher than international inflation, resulted in a permanent deterioration in companies in
those categories which continued to produce, thus reinforcing the process of unemployment in them.
Against this general background, as can be inferred from the foregoing, industrial trade unionism was the one generally most affected
in terms of the material and social base on which its existence depended. The implementation of the economic model significantly
reduced industry's share of gross domestic product and employment of the labour force, the former from 25.07 per cent in 1974 to
21.75 per cent in 1980, and the latter from 19.8 per cent of employment in the sector in 1972 to 16.1 per cent in 1980.
Within this general decline, three situations should be highlighted because of their impact on trade unionism.
Firstly, the fall in employment affected the social recruitment base for trade unions in small-scale industry differently from medium-sized and large-scale industry. While in businesses with less than 50 employees, the number employed overall fell by 38 per cent in
the period 1967-78, in those with over 50 employees, employment fell by 16 per cent between 1972 and 1979.
As a result, considering that trade union organization in small-scale industry was proportionately less, because since 1979 at least 25
workers were needed to form a trade union and that, in that stratum, there were many companies with less than 25 employees, the
global impact of unemployment in industry was less for the most important trade union group, which was in companies with over 50
employees.
Thus, while the fall in employment had a serious impact on the development of trade unions in industry, this factor had a much
stronger impact on trade union organization in small enterprises than in medium-sized or large ones.
Secondly, within the higher stratum of over fifty employees, several of the areas where trade unions were the most active, including
many of the organizations most closely connected to the Single Workers' Union (CUT), were the most severely hit by changes in the
pattern of employment and the economy. Indeed, taking the textile and clothing, metallurgical, electro-metallurgical, automotive,
leather, footwear and printing sectors together, the conclusion is that these branches, which provided the fundamental contribution to
trade union organizations at federation level, significant in terms of membership and political development, they alone accounted for
almost all the decline in employment and the fall in added value in companies with over 50 workers. (See table on next page).
Average employment and added value by industrial branch
(In companies with 50 or more workers in branches of strategic significance to trade unionism)
|
Federation |
Branch |
Average employment |
Added value 1
|
|
|
1970 |
1972 |
1979 |
1970 |
1972 |
1979 |
|
Textiles and
clothing |
321
322
|
37,244
9,610 |
38,444
9,591 |
28,062
12,279 |
12,390
2,737 |
14,926
3,747 |
5,278.6
2,635.9 |
|
Metallurgical |
381
382
|
18,133
12,789 |
15,362
14,610 |
14,404
7,382 |
6,330
4,275 |
6,512
4,853 |
4,588.6
2,512.9 |
|
Electrical
engineering and
automotive
|
383
384 |
9,305
20,266 |
11,085
20,266 |
6,584
8,015 |
5,874
8,688 |
7,006
8,917 |
2,540.2
3,898.0 |
|
Leather and
footwear
Printing
|
323
324
342
|
2,758
9,100
7,736 |
2,659
8,936
8,212 |
1,831
6,299
7,993 |
1,106
3,478
3,768 |
1,858
4,424
5,231 |
663.6
2,005.0
4,917.2 |
|
Sub Total
Other
Industrial branches |
|
126,941
109,912 |
129,165
122,712 |
92,849
119,288 |
48,646
61,178 |
57,474
74,240 |
29,040.0
70,191.7 |
Source: based on INE industrial survey
Millions of pesos at December 1979
The foregoing does not mean that employment and added value did not decline in branches other than those mentioned. In the other
branches, taken as a whole, the fall in both indicators in some was offset by a rise in others.
Consequently, industrial trade unionism in medium and large-scale enterprises (which, as mentioned, were proportionately in the
majority), suffered the impact of changes in the economy and employment in a fairly localized manner, precisely in those areas where
trade union federations had developed relatively rather more.
The decline in these branches was not only reflected in employment and added value, but also in a fall in the number of
establishments of less than 1000 workers and in workers' wage levels. Thus in 1977 the number of the largest establishments had
fallen to 9, where there had been 17, ten years earlier. Likewise, wages in 1979 were equivalent to only 87 per cent of those in 1970,
while the proportion in the other industrial branches was 96 per cent.
Thirdly, offsetting the situation described above, in those branches where trade unionism was more active at company rather than
federation level (even where there were also sectoral organizations), the effects were less marked or conversely there was a degree of
expansion.
Branches such as the manufacture of oils and fats (3.115), processing of fish and shellfish (3.113) and the food industry in general
(311) had significantly higher levels of employment in 1979 than in 1972. The same was true of the woodworking industry (331) and
manufacture of paper from cellulose (341) where, as well as increased employment, the number of enterprises with over 1000
workers rose from 1 to 5 between 1967 and 1977. A similar trend occurred in the manufacture of chemicals (351) and the
manufacture of other chemical products (352), where in the same period the number of the largest establishments rose from 1 to 3.
Other branches should also be noted, such as the manufacture of other non-metallic mineral products (369), which in 1978 were
showing a growth in employment from base levels lower than 1972.
Several of these branches also showed an increase in added value or recovered more rapidly than others from the 1975 depression.
Some of them were relatively important in employment terms, food, for example, chemical products and wood. The first two also had
a significant share of added value, equal to oils. Others, on the other hand, such as paper, cellulose and processing of fish and fruit
were less important in employment terms.
These structural conditions, which were generally favourable to those branches, were not, however, matched by a highly developed
trade union organization, especially in sectors such as woodworking, much of the food and chemicals industry and in some of the
other branches mentioned above. This was because they had less experience of federation, as already pointed out, and with the
consequent predominance of a basically company-based unionism, in many cases, scattered over a wide geographical area.
As a result, its more promising structural position did not create the conditions for mobilization any better than those in the most
affected areas. The latter, which despite everything retained an important place in employment and in production, continued to be the
most active and even, managed to maintain their federations.
The foregoing shows that structural conditions, while an actual or potential force, do not alone create the capacity for mobilization.
That was linked to the political and historic factors that had made it possible to achieve that capacity.
Lastly, it should be noted that in the three situations considered, there was a decline in the number of workers employed, so that trade
unionism at this level, in the context of the general processes described, was the most affected.
In conclusion, within the industrial sector, the organized labour most hit by the structural changes was in small industry and in
medium and large-scale categories, particularly those that had the greatest organizational and political experience. In all of them, the
conditions of manual workers were more affected than office workers. Moreover, the activities where company-based rather than
sectoral trade unionism developed generally had better employment and economic conditions. In all the processes, the position held
by different activities in the restructuring of the economy generated by the free trade nature of the chosen economic model was a
decisive influence.
In the mining sector, the powerful trade unionism in the great copper mining industry, unlike most of industry, saw improvements in
the structural bases of influence, in terms of an improvement of its existing strategic position in the economy and growth in
employment.
Both in terms of production and employment, the importance of the Great Copper Mining Corporation grew during the years in
question. Production increased from 540 thousand to over 900 thousand tonnes, increasing its share of total domestic production from
75 to 85 per cent.
Employment also grew to over 5,000 workers, some 20 per cent more than those employed in 1972, with an increase in productivity
per employee of over 40 per cent.
However, the level of pay in 1979 was only 56 per cent of that in 1972. As a result of that, there was a reduction in wage differentials
compared with medium and small mining operations, which saw a lesser decline.
As a result, while trade unionism in the major mining centres had a stronger economic and employment base than eight years earlier,
it also had a poorer social constituency. This partly explained why its potential strategic economic power could not be exercised
effectively enough under the authoritarian rule to which the country was subject during that period.
The same thing did not happen in coal and nitre mining, two other strong trade union bases. The position of both activities declined
in the overall economy and also declined in employment terms. In the case of the former, coal production in 1979 was almost 40 per
cent lower than in 1970 and nitre 22 per cent down in the same period. Employment in coal fell by 25 per cent and nitre by 30 per
cent.
Finally, wages in 1979 fell in coal by 55 per cent compared with 1972 and in nitre by 57 per cent over the same period.
As a result, the material and social conditions of mining and nitre unions deteriorated drastically, thus reducing their ability to exert
pressure. However, both places continued to be major concentrations of workers (10,000 in coal and 6,500 in nitre) and where trade
unions survived because, despite everything, they retained a capacity for defensive mobilization, which was put into practice on
various occasions during the period, especially in coal.
Construction proved to be another area significant in trade union terms that was drastically affected by the post-73 economic changes.
In structural terms, this sector in 1970 was a highly significant employer; double the size that of mining and representing over one
third of all manufacturing employment. In the years after 1973, this activity was the most drastically affected by the drop in
employment, which in 1976 was less than 50 per cent of those four years earlier. In 1978, it began a slow recovery and in 1980 had
reached levels of employment 81 per cent of those of ten years earlier. However, the high dependency of this activity on interest rates
and the 1981 recession crisis depressed it once more, and prevented the restoration of stable employment.
These conditions had a strong impact on the construction unions, which, prior to 1973, were one of the pillars of the CUT. High
occupational mobility and the dispersion of small companies, together with the fall in employment, disrupted the ability to organize
in trade unions. In addition, the legislative changes in 1979, which prevented independent trade unions (those that did not belong to
an establishment) from negotiating; a common situation in this activity reduced the possibility of trade union action in this sector
even more drastically.
The result was that trade unionism in the construction industry seems to have been the most affected by the current economic model
and the one whose structural potential was most seriously weakened.
By way of conclusion to the situation examined within the manufacturing sector, it can be determined that in the three sectors
analysed (industry, mining and construction), only in the great copper mining corporation are there favourable structural conditions
coupled with a developed trade union organization. In industry, the centres that achieved some economic progress in the new
situation generally did not have a matching trade unionism, and construction, as a whole, was the most fragmented. However,
although this structural situation, unfavourable to the traditionally most active nuclei of trade union activities, severely restricted
them, it did not prevent them, despite everything, from continuing to be the nuclei where trade union action managed to maintain a
visible profile throughout the period. It was as a result of their organizational and political tradition that they were able at least to
offer resistance to the drastic process of change overall in the economic model and the authoritarian political system.
Finally, it should be observed that the favourable situation that the economic model created in the service sector led to a better
structural position, as the basis for trade union action, essentially in trade and banking. Of the two, it is the second that offered more
propitious conditions for organizing a trade union as, although trade had a not insignificant membership base, it was more widely
scattered. However, trade unions in banking, generally, were normally rather more of a corporate-professional sector, so that their
links with other sectors of the trade union movement were weak.
As far as the public sector is concerned, which had a very active trade union sector in ANEF (National Association of Fiscal
Employees), which belonged to the CUT, its social and structural base was drastically affected. The policy of reducing the public
sector, one of the fundamental components of the model adopted, meant a reduction of over 100,000 in the number of those
employed in the sector. Parallel to that, the wage policy resulted in severe reductions in the real wages of unskilled workers, such that
public employees dropped to wage levels much lower than those at the beginning of the decade.
However, the perseverance of ANEF in maintaining its union activity meant that, despite the obstacles, the sector managed to
preserve an important representative role.
1.2. The impact on the constituents of trade unionism: membership and trade union organization in the
period 1973-1981
This section sets out the impact of the structural processes described above on trade union organization and membership in Chile
from the beginning of the military regime.
In order to situate this period in its historical context, these characteristics are contrasted with the most significant trends in the years
prior to 1973.
Our attention is focussed mainly on urban and mining trade union organization because that was the base from which Chilean trade
unionism sprang. Consequently, the extractive sectors, together with agriculture, fisheries, hunting, forestry and woodworking have
been included only as general background information.
Trade union organization and its scale
The advent of the military regime was a serious setback to the trade union development of the previous twenty years. Both the policy
of coercion imposed by the regime and the structural changes in the economic sphere had a marked effect on the traditional pace of
trade union development.
Starting with those more global changes, it should first be noted that, from 1974, there was a gradual decline in the number of
workers belonging to trade unions. In preceding years, on the other hand, the trend had been in the opposite direction.
Indeed, in the period between 1962 and 1970, membership grew by 151 per cent. This level of development was primarily born in
1965 with the Christian Democrat Government and it represented the end of the decline, which had affected the trade union
movement during the Conservative Government of Jorge Alessandri (1958-1964).
Between 1970 and 1973, the trend grew even stronger, so that the number of members grew in absolute terms in three years as much
as in the eight years before that. It was to be followed by a fall in union membership.
(Including agriculture, hunting, fisheries, forestry and woodworking)
| 1956 |
1962 |
1966 |
1970 |
1973 |
1975 |
1977 |
| 328180 |
249860 |
361192 |
628396 |
939319 |
940810 |
916569 |
Source : Isla, Tarud, Jorquera. (DERTO) University of Chile1978
Although the figures show a slight drop between 1973 and 1977, a process of decline in trade union membership had begun due to both the structural changes
described above and the Government's anti-union measures. The lack of precise figures between 1977 and the end of the seventies makes it difficult to obtain
statistical evidence for this period, but after 1980, when reliable data was available, membership had fallen to 386,910 (Department of Labour).
Concerning the number of trade unions, although the number recorded in 1977 was slightly higher than in 1973, the trend that
emerges is one of stagnation.
The number of trade unions thus stabilized while the number of members declined. This led to a reduction in the average size of trade
unions.
The different growth rates of trade unions and members is a recurrence of a trend which became very marked in the years 1956-1969,
a period when the average number of employees fell from 136.2 to 118.4. This trend, however, it had been possible to reverse during
the years of the Popular Unity Government. Measured as a percentage, the rate of growth in membership was greater than the rise in
the number of trade unions.
Looking at membership broken down by legally recognized categories of trade union, it emerges that those of an industrial nature
(manual workers) are most affected by the decline in membership (13.7 per cent down in 1977 from 1973), followed by professional
unions (4.6 per cent down). The latter include office workers, self-employed and employers in some segments.
This deterioration particularly affected those trade unions whose members were employed by a
single employer, i.e. manual and office workers, since members of employee trade unions, i.e.
"dependent" workers, had fallen in 1997 by 8 per cent since 1973, thus higher than the 4.6 per cent
for their category as a whole.
In 1973, dependent workers made up 88.7 per cent of the total membership. Four years later, that level was 86 per cent. It was
precisely those wage-earning trade unionists who formed the base of the Single Workers' Union.
This overview can be examined further through an analytical breakdown by economic sector.
The period 1970-1973 does not record any economic sectors in which trade unions saw a decline in their size. Quite the contrary,
trade unions and membership were generally on the increase in all branches.
Trade unions and dependent members
Breakdown by legal definition into industrial and professional, excluding agricultural unions and their members (70-77) index 100
in 1973
|
INDUSTRIAL |
PROFESSIONAL |
TOTAL |
| Year |
Unions |
Index |
Members |
Index |
Unions |
Index |
Members |
Index |
Total
Unions |
Index |
Total
Members |
Index |
| 70 |
1,448 |
78 |
496,425 |
86 |
1,970 |
66 |
223,859 |
60 |
3,418 |
71 |
420,284 |
70
|
| 71 |
1,606 |
87 |
210,473 |
92 |
2,216 |
75 |
270,220 |
72 |
3,822 |
80 |
480,693 |
80
|
| 72 |
1,782 |
96 |
233,781 |
98 |
2,734 |
93 |
339,146 |
90 |
4,516 |
94 |
562,927 |
93
|
| 73 |
1,841 |
100 |
227,786 |
100 |
2,946 |
100 |
372,408 |
100 |
4,787 |
100 |
600,194 |
100
|
| 74 |
1,900 |
103 |
219,602 |
96 |
3,173 |
108 |
372,455 |
100 |
5,073 |
106 |
592,057 |
98
|
| 75 |
1,879 |
102 |
207,238 |
91 |
3,261 |
109 |
365,622 |
98 |
5,140 |
107 |
572,860 |
95
|
| 76 |
1,836 |
99 |
199,164 |
87 |
3,255 |
110 |
351,822 |
94 |
5,091 |
106 |
550,986 |
92
|
| 77 |
1,808 |
98 |
196,529 |
86 |
3,193 |
108 |
343,180 |
92 |
5,001 |
104 |
539,709 |
90 |
Source: based on Isla, Jorquera, (DERTO), University of Chile.1978.
Trade unions and members by branch of industry
The situation was different at the end of 1973, when the decline in trade union membership began. The sectors most affected were
construction and manufacturing. The former lost 18,639 members between 1973 and 1977 and the latter 34,545 during the same
period.
However, as a proportion of total membership numbers, the sharpest fall was in the construction industry. The number of members in
1977 was only 66 per cent of that in 1973. That was despite the fact that the sector had appeared to be the most dynamic in the years
that proceeded. From 7,525 members in 1956, it rose to 17,317 in 1969. During the period 1970-1973, the number of members rose
by 135 per cent, to a total of 54,029.
Within manufacturing, the sectors most affected were textiles, leather and footwear, metalworking and non-metallic minerals. Taking
both manufacturing and construction together, the lower membership was organized into a greater number of trade unions.
In manufacturing, the number of trade unions rose from 2,418 in 1973 to 2,528 in 1977. In construction, the figures were 239 and 244
respectively. In both cases, the rise in the number of trade unions related only to the "professional" (office) category. Among
"industrial" (manual) workers, the number of trade unions fell by 1 per cent in manufacturing and 6 per cent in construction. Thus,
the number of manual workers fell in terms of both membership and number of trade unions.
By 1977, mining had shown little change in the number of "professional" members, and the number of trade unions in that category
rose by 7 per cent, while "industrial" membership and trade unions fell by 10 per cent, to below 1973 levels. Despite that, the sector
maintained its tradition of the highest levels of unionization.
Index of trade unions and members 1970-1977
Base 100 1973, by branch of activity
(Excluding agriculture, forestry, hunting, fisheries and woodworking)
Mining |
Manufacturing |
Electricity
Gas, steam, water |
Construction |
Trade |
| |
Industrial. |
Profess. |
Industrial |
Profess. |
Industrial |
Profess. |
Industrial |
Profess. |
Industrial |
Profess. |
| Year |
TU |
M |
TU |
M |
TU |
M |
TU |
M |
TU |
M |
TU |
M |
TU |
M |
TU |
M |
TU |
M |
TU |
M |
| 1970 |
81 |
89 |
73 |
70 |
81 |
88 |
66 |
57 |
103 |
98 |
78 |
92 |
55 |
49 |
58 |
42 |
63 |
75 |
66 |
64 |
| 1971 |
87 |
92 |
82 |
80 |
89 |
94 |
74 |
70 |
103 |
107 |
83 |
94 |
78 |
65 |
76 |
59 |
67 |
87 |
75 |
76 |
| 1972 |
96 |
94 |
94 |
91 |
97 |
100 |
92 |
87 |
100 |
106 |
97 |
98 |
96 |
75 |
97 |
100 |
92 |
99 |
94 |
92 |
| 1973 |
100 |
100 |
100 |
100 |
100 |
100 |
100 |
100 |
100 |
100 |
100 |
100 |
100 |
100 |
100 |
100 |
100 |
100 |
100 |
100 |
| 1974 |
100 |
99 |
110 |
106 |
103 |
96 |
107 |
99 |
97 |
92 |
104 |
101 |
106 |
84 |
112 |
94 |
109 |
103 |
106 |
102 |
| 1975 |
96 |
98 |
112 |
105 |
102 |
89 |
112 |
88 |
90 |
81 |
105 |
104 |
102 |
75 |
115 |
79 |
107 |
98 |
110 |
103 |
| 1976 |
94 |
94 |
109 |
101 |
100 |
86 |
113 |
93 |
81 |
52 |
104 |
103 |
100 |
71 |
109 |
70 |
103 |
96 |
113 |
105 |
| 1977 |
90 |
90 |
107 |
101 |
99 |
85 |
111 |
91 |
81 |
72 |
100 |
97 |
94 |
66 |
104 |
65 |
102 |
97 |
112 |
106 |
| | Transport |
Finance and Insurance |
Social Services |
Act. not
specified |
| 1970 |
76 |
78 |
69 |
61 |
75 |
66 |
64 |
53 |
65 |
76 |
70 |
62 |
100 |
100 |
| 1971 |
89 |
77 |
78 |
74 |
100 |
96 |
76 |
71 |
74 |
82 |
76 |
73 |
100 |
100 |
| 1972 |
97 |
87 |
93 |
89 |
100 |
101 |
96 |
89 |
93 |
91 |
92 |
89 |
n/a |
n/a |
| 1973 |
100 |
100 |
100 |
100 |
100 |
100 |
100 |
100 |
100 |
100 |
100 |
100 |
n/a |
n/a |
| 1974 |
97 |
89 |
110 |
105 |
100 |
101 |
103 |
98 |
104 |
96 |
108 |
104 |
100 |
33 |
| 1975 |
100 |
92 |
115 |
108 |
100 |
100 |
103 |
94 |
104 |
91 |
110 |
111 |
200 |
58 |
| 1976 |
97 |
90 |
117 |
109 |
88 |
83 |
102 |
100 |
96 |
93 |
114 |
107 |
200 |
64 |
| 1977 |
92 |
83 |
116 |
108 |
88 |
83 |
101 |
94 |
104 |
110 |
111 |
105 |
300 |
94 |
Source: Based on Isla, Tarud, Jorquera. (DERTO), University of Chile 1978
Of the remaining branches, transport/communications showed modest rises in the number of trade unions and members, but only in
the "professional" category. Trade, for its part, saw an increase in the total number of trade unions, but a decline in the number of
manual workers, with a slight increase in office members. The same occurred in the case of membership, in finance and insurance.
Finally, social and local services showed a slight rise in the number of trade unions and members.
The following tables show the full details of the situation that we have described above.
Size of trade unions
To analyse the size of trade unions, measured as the number of registered members, the study by Isla, Tarud and Jorquera uses a
series of six categories as shown in the following:
Distribution of trade unions, as a percentage, by size, branch and selected years;
| | MANUFACTURING |
MINING |
CONSTRUCTION |
ELEC. GAS, STEAM AND WATER |
|
SIZE |
70 |
73 |
75 |
77 |
70 |
73 |
75 |
77 |
70 |
73 |
75 |
77 |
70 |
73 |
75 |
77 |
| Under 25 |
5.68
|
5.54 |
9.10 |
12.5 |
1.21 |
0.93 |
2.64 |
5.8 |
1.92 |
2.51 |
3.71 |
7.78 |
3.3 |
3.8 |
2.8 |
4.12 |
| 25 - 49 |
37.03
|
38.70 |
42.09 |
40.42 |
25.10 |
31.36 |
32.94 |
3.6 |
32.5 |
36.55 |
43.49 |
43.03 |
34.83 |
40.7 |
40.3 |
38.14 |
| 50 - 124 |
35.69
|
34.90 |
30.86 |
30.06 |
36.8 |
34.78 |
34.11 |
32.19 |
33.33 |
28.87 |
26.76 |
25.0 |
32.58 |
46.57 |
33.65 |
35.05 |
| 125 - 399
|
17.84
|
16.66 |
14.6 |
13.96 |
22.6 |
19.87 |
18.52 |
19.19 |
25.0 |
20.92 |
18.21 |
17.62 |
17.97 |
15.53 |
14.42 |
12.37 |
| 400 - 999 |
2.84
|
3.30 |
2.51 |
2.41 |
8.50 |
6.83 |
5.58 |
5.8 |
7.05 |
5.85 |
5.57 |
4.09 |
7.85 |
8.2 |
6.7 |
7.2 |
| over 1000 |
0.89
|
0.86 |
0.73 |
0.63 |
5.66 |
6.21 |
6.17 |
6.19 |
0.64 |
5.43 |
2.23 |
2.45 |
3.33 |
2.91 |
1.9 |
3.09 |
Source: based on: Isla, Tarud, Jorquera. (DERTO).
For all areas of economic activity, the majority of members are concentrated in two lines: 25 to 49 members and 50 to 124 members. In the sectors most "active" in trade union life, i.e. manufacturing, mining and
construction, 63 to 70 per cent of their members were in that category in 1977.
The three sectors just mentioned show a rising number of trade unions with less than 25 workers. Manufacturing stands out in this
respect, where the smallest trade unions account for 12.5 per cent of members, seven points up from 1973. In the case of mining and
construction, the smallest unions gained 5 percentage points in membership terms.
The rise in the number of the smallest trade unions occurred especially in manufacturing, at the expense of the larger unions.
Manufacturing and construction are where the average size of trade unions fell most sharply compared with 1973. In manufacturing,
the average size of trade unions fell from 116 in 1973 to 97 in 1977. Within that, the textiles, clothing, leather and footwear branch,
which was most severely hit by the new economic model, showed an average of 154 and 113 respectively for those years.
Mining had an average of 253 members per union in 1973. In 1977, that average had fallen to 240. Construction fell from 226
members to 145 over the same period.
Affiliation of federations to national groups
Since 1973, when the CUT legally ceased to exist, various trade union groups were formed in an attempt to form national
associations. The process began in 1974, but it was only from 1976 onwards that they managed to establish themselves with a greater
degree of permanency. None of these national unions were legally recognized and, in fact, no third tier organizations were
contemplated in the legislation that regulated trade union associations that came into force in 1979.
These central unions, better known as "national groups", were basically the CNS (National Trade Union Coordinating Body), UDT
(Democratic Workers' Union) FUT (Workers United Front) UNTRACH (Chilean Workers' Union). To these could be added the
Confederation of Individual Workers (CEPCH), which was already in existence and the only one to retain legal recognition.
It is difficult to ascertain trade unions capacity to affiliate, as there are no clear data on the subject. However, a 1981 study by the
Vicaría Pastoral Obrera (Workers' Pastoral Mission) estimated that federations actually associated to these central associations could
be broken down as follows: CNS - 10, UDT - 8, UNTRACH - 9, CEPCH - 3, FUT - 1. In addition, 4 belonged to the CNT (National
Workers' Command) created by the military government. Another 3 were spread between different groups and a further 13 were not
affiliated.
Bearing in mind that there were 87 principal federations actively affiliated to the CUT, it can be seen that only 51
survived the period.
1.3. Summary of the processes in the period 1973-1981
After 1973, the trade union growth, which had marked the preceding period, entered a period of stagnation. Not only did the absolute
number of members decline, as a result of high unemployment, but also organized labour became more fragmented as trade unions
diminished in size.
In qualitative terms, the impact was significant when it is considered that the manufacturing and construction sectors, the traditional
base of trade unionism, seemed to be particularly affected both in total volume and average size. Mining, especially coal, (another
key sector) also showed deterioration.
In short, as a result of the structural effects of the chosen economic model and the political constraints that stood in the way of trade
union development, workers' organization was diminished and its evolution obstructed. The situation was more marked among
manual workers than office workers. It shows both the type of unemployment and changes in the composition of the work force.
The situation can be regarded as critical when it is considered that the weakening was global and that, furthermore, new sectors did
not emerge to reinforce and offset the decline in the traditionally most strategic centres.
Consequently, both the political process and the structural changes arising under the new economic model introduced in the early
seventies led to a decline in trade union activity and a drastic change in the composition of the social base on which trade unionism
was founded. Nevertheless, it did not mean that the trade union movement vanished completely.
Throughout the period, the action of trade unions, their federations and national bodies consisted of a constant struggle against the
military government in an effort to restore the democratic political system and at the same time a struggle against the policy of
introducing a neo-liberal economic policy. As we have said, for trade unionism, the struggle against the dictatorship and against the
economic model were part of the same process. At that stage, to pursue these actions, the trade union movement was forced to
organize under its leadership not only trade unions but also all social organizations, whatever their composition. Thus, the trade union
leadership included urban district associations, many professionals, unemployed and even student bodies and groups linked to basic
religious organizations.
Out of this experience came the idea that, under the new structural, institutional and political conditions, trade unionism could
redefine its constituent base and move from the traditional purely labour view of its organization to a broader social view. The idea
developed to some extent up to 1985, but after that it failed to take hold.
2. The economic crisis of the early eighties, the
recovery and consolidation of the current economic development
model (1981 and the decade of the nineties)
The aim of this section is to show the economic and social processes whose development defined the structural,
institutional and political conditions that were firmly rooted by the nineties. Trade union responses to globalization in this
decade had their origins in their experience from 1973 onwards, but their strategies and policies were consolidated during
that period and the post-crisis era.
2.1. The crisis
By 1980, the largest economic, structural and institutional changes had already happened, Chile's integration in the global economy
was in full swing, market forces held sway, the culture of the country as a whole was one of incorporation in the globalized world and
the trends in the main economic variables had proved fairly favourable. However, the chosen model proved to be fragile, both
domestically and internationally. The fact was that the economy was centred around a significant financial rather than a productive
development, which made it vulnerable to speculation and limited hard investment in favour of so-called "migrant" capital.
Moreover, the country's entry into the globle economy was not designed to deal with external crises such as occurred internationally
in the early eighties. As a result of these and other factors, the Chilean economy fell into a deep recession with a decline in GDP of at
least 14 per cent and overt unemployment close on 35 per cent.
The situation unleashed major decisions for change in the management of the economy by the military government, albeit retaining
the basic scheme of the economic model adopted in 1975. Various policies were reformulated, especially those aimed at
strengthening productive capacity and controlling the financial system.
On the social level, the trade unions succeeded in leading a vast social protest movement against
the military regime and its policies, despite the fact that by 1981-82, trade union membership had
fallen to a third of what it was in 1977 (347,470 against 916,569). This led to the so-called "national
protests" of 1983-1984. That was the occasion when trade unionism succeeded in promoting most
strongly the possibility of leading a social base wider than organized labour. In fact, the protests
did bring out much wider groupings of people and organizations under the leadership of the trade
unions. These movements were the beginning of the end of the dictatorship, since it was because of
them that the military government had to agree to negotiate with the political opposition and allow
them room to express their views. However, the trade union leadership was overtaken at that stage
of negotiation by party leaders and the new profile that it was acquiring as the cement of a wider
social base lost ground and ultimately evaporated.
2.2.The recovery of the economic model
Analysts agree that, once the crisis was over, it was in 1985 onwards that the bases of Chile's current economic process were
established. The decade after that was a period of rapid growth. There was permanent job creation and a return to a climate of
political stability. After the serious crisis of the preceding years, the production levels recovered, savings and investment increased,
inflation was brought under control, unemployment was reduced and real wages grew in line with productivity.
During the ten years after 1985 a satisfactory macro-economic equilibrium was achieved. Domestic
product grew by an annual 6.6 per cent, inflation was falling steadily, there was a sustained
increase in productivity and domestic and external fiscal accounts were sound.
There were some significant achievements on the social front. Literacy school attendance and life expectancy at birth all improved.
The number of individuals and families below the poverty line fell significantly.
While these were the general features of the post-crisis period, the distinction between the two stages suggested in the ILO study
"Employment trends in Chile 1986-1996" published by the Santiago multidisciplinary team in 1998 should be examined.
The study distinguishes a first phase between 1986 and 1989, i.e. up to the end of the military government and the take-over by the
democratic government.
According to the ILO document, although the process of recovery and improvement in the economic indicators began in 1986,
economic growth in that first phase was characterized by excess capacity and the high rates of unemployment left as legacy of the
profound crisis that had gone before.
The crisis was overcome by an economic adjustment in 1985 with a high social cost. In order to alleviate some of its effects, policies
such as cash subsidies to the poorest sections of the population were adopted as well as the creation of the PEM and POJH
emergency employment programmes, which employed almost 10 per cent of the work force between 1986 and 1989.
Although these programmes helped to reduce overt unemployment, it was still above 10 per cent in 1989. Although real wages had
risen, they were still 5 per cent below 1981 and 1982, and the legal minimum wage was 30 per cent less than in those years. The pace
of trade union organization and the level of workers' collective bargaining, despite a recovery between 1986 and 1989 compared with
the preceding years, was slowing and had reached less than 10 per cent of the workforce.
The second period, according to the ILO study, ran from 1990 to 1996, culminating in the consolidation of the recovery and the
formation of Chile's present-day economic and social environment, the background against which trade unions are tackling the
processes of globalization.
The period was one of high growth in domestic product, 6.8 per cent on average, a drop in inflation from 21 per cent to 6.6. per cent
between 1989 and 1996, strong fiscal accounts and accumulation of international reserves, growth in the level of savings, investment
and productivity, more job creation and rising real wages.
The fall in unemployment in the first phase between 1986 and 1989, according to the ILO study and noted above, was mainly the
result of the mobilization of resources that has been frozen during the preceding crisis. It was only secondarily due to the
diversification of the production of primary export commodities (wood, fruit, fish) and goods requiring a certain degree of processing
(wine, preserves). In any case, this allowed a return to the levels of employment prior to the crisis. However, after 1989, the growth
was the result of expansion of installed capacity, strongly geared towards exports. Unemployment stabilized at an average of between
6 and 7 percent.
2.3. The social base of trade unionism in the nineties: structure and major features of the workforce and
employment.
The proportion of women in the workforce increased. According to the same ILO study, after 1989 the rise in employment was
mainly due to the entry of more people to the labour force, especially women. Between 1986 and 1994, the proportion of women rose
from 29.3 per cent to 35.4 per cent. The expansion of the fruit sector, trade and financial services, among other things, was the cause
of the rise in the proportion of women. In the secondary sector, men continued to predominate. Of the total employed in 1996, 80 per
cent were men.
Female employment was thus concentrated in the tertiary sector. By 1996, this activity accounted for 80 per cent of working women.
Trade had the largest number of women workers, 22 per cent in 1986 and 24 per cent in 1996.
Employment in agriculture and mining grew slightly. In the primary sector, employment in agriculture fell from 20 per cent in 1986
to 15 per cent in 1996. Mining still offered few new jobs.
Manufacturing recovered but did not regain its traditional position. By 1996, the secondary sector had increased its share from 21
per cent in 1986 to 27 per cent. Even so, the recovery in manufacturing employment did not return to pre-crisis levels and began to
stagnate after 1994.
The tertiary sector retained a high share of employment. By 1996, the sector was employing some 58 per cent of the total labour
force.
Changes within the different occupational categories. The most significant changes in the period occurred in the category of
"farmers, livestock breeders, fishermen, hunters and the like" from 21 per cent to 16 per cent, and "manual and casual workers" from
11 per cent to 6 per cent. Other groups increased their share, especially office workers, from 11 per cent to 15 per cent.
Consequently, the main change in the pattern of employment between the mid-eighties and nineties was the decline in the number of
"manual workers" and the significant increase in "office workers," the latter mainly in the private sector, since those in the public
sector had declined by some 30 per cent.
The greater proportion of women was also reflected in a significant growth in the group of "professionals, engineers and the like" and
"managers, administrators and directors". This showed that at least some of them were obtaining jobs of a certain quality, although
that did not prevent wage discrimination between men and women in these categories of employment.
Changes in workers' educational levels. According to the ILO study, there was a marked increase in all categories of employees with
higher education, from 10 to 18 per cent. Among "managers, administrators and directors", it rose from 39 to 44 per cent, and the
profile of "office workers and the like" also changed radically, from 16 per cent to 39 per cent with higher education.
The lowest level of education was in "farmers, livestock breeders, fishermen, and the like", where 80 per cent of those employed
were uneducated or had only primary education.
2.4. Summary of the background to the social base of trade unions in the nineties
The following two tables are a summary of employment trends by branch of activity between 1970 and 1996, illustrating the
processes of change which occurred in this indicator over the almost thirty years since the country began to take its place in the
global economy.
Employed persons by branch of activity, total country
(thousands of persons and percentage)
| Category |
1970
Sept-Dec. |
1972
Jan-Jun. |
1975
Jul.-Dec. |
1977
Oct.-Dec. |
1979
Oct.-Dec. |
1981
Oct.-Dec |
1982
Oct.-Nov |
| Agriculture and
fisheries
|
472,8
(16.0)
|
379.4
(12.7) |
540.4
(17.34) |
550.6
(17.2) |
543.7
(15.6) |
542.1
(14.6) |
506.4
(14.4) |
| Mining
|
55.1
(2.0)
|
58.4
(2.00) |
88.6
(2.8 ) |
82.2
(2.6) |
83.4
(2.4 ) |
70.8
(1.9) |
62.7
(1.8) |
| Manufacturing
|
709.8
(24.4 )
|
775.9
(26.4) |
529.0
(17.0) |
522.8
(16.3) |
566.9
(14.5) |
585.1
(16.0) |
483.6
(13.8) |
| Electricity, Gas
and Water |
18.3
(0.6)
|
21.0
(0.7) |
25.4
(0.8) |
34.2
(1.06) |
28.3
(0.81) |
29.9
(0.8) |
29.2
(0.8) |
| Construction
|
220.8
(7.6)
|
249.7
(8.4) |
169.5
(5.5) |
135.4
(4.2) |
177.3
(5.1) |
228.6
(6.2) |
160.9
(4.6) |
| Trade (1)
|
420.6
(14.4)
|
406.2
(13.6) |
437.4
(14.02) |
486.5
(16.0) |
578.6
(16.6) |
670.8
(18.0) |
566.7
(16.2) |
| Transport and
Communications
(2) |
214.1
(7.3)
|
269.9
(9.06) |
200.2
(6.4) |
189.7
(56.0) |
223.6
(16.6) |
238.6
(6.3) |
211.0
(59.6) |
| Financial services
|
(-) |
(-) |
80.0
(2.6)
|
81.6
(2.6) |
94.8
(2.7) |
125.6
(3.4) |
122.3
(3.5) |
| Community, social
and personal
services |
777.1
(26.7) |
786.5
(26.4)
|
862.4
(28.0) |
982.1
(31.0) |
1.032.6
(29.7) |
1.096.7
(29.8) |
1.209.4
(34.5) |
| Other activities |
1.7
(0.06) |
7.4
(0.25)
|
24.0
(0.7) |
15.3
(0.5) |
10.0
(0.28) |
4.1
(0.1) |
2.8
(0.08) |
| First-time job-seekers |
18.9
(0.65 )
|
25.5
(0.9) |
157.8
(5.07) |
118.6
(3.7) |
138.2
(4.0) |
95.7
(26.0) |
148.9
(4.3) |
|
TOTAL |
2,909.4 |
2,979.9 |
3,114.7 |
3,199.0 |
3,477.5 |
3,688.0 |
3,503.6 |
NOTE: figures from the national employment survey by the National Institute of Statistics in the above-mentioned periods.
(1) Includes wholesale, retail, restaurants and hotels.
(2) Includes storage.
(-) Information not available
Employed persons by branch of economic activityEmployed persons by branch of economic activity
1986-1996 (in thousands and percentage)
|
Branch of
economic activity |
1986 |
1988 |
1990 |
1992 |
1994 |
1996 |
| Agriculture |
790.1
(20.5)
|
877.0
(20.5) |
887.6
(19.6) |
901.7
(18.5) |
857.2
(16.7) |
816.4
(15.4) |
| Mining |
80.6
(2.1)
|
84.2
(2.0) |
99.2
(2.2) |
82.2
(1.7) |
83.3
(1.6) |
90.6
(1.7) |
| Manufacturing |
526.9
(13.6)
|
670.7
(15.7) |
727.1
(16.1) |
828.3
(17.0) |
829.3
(16.2) |
859.6
(16.2) |
| Electricity |
25.2
(0.7)
|
25.5
(0.6) |
22.7
(0.5) |
24.6
(0.5) |
35.3
(0.7) |
41.7
(0.8) |
| Construction |
185.7
(4.8)
|
279.4
(6.5) |
292.7
(6.5) |
351.8
(7.2) |
375.7
(7.3) |
417.0
(7.9) |
| Trade |
643.9
(16.7)
|
735.7
(17.2) |
790.3
(17.5) |
859.3
(17.6) |
956.1
(18.7) |
931.9
(17.6) |
| Transport |
234.6
(6.1)
|
282.0
(6.6) |
317.6
(7.0) |
343.0
(7.0) |
388.0
(7.6) |
393.9
(7.4) |
| Financial Services |
155.2
(4.0)
|
182.9
(4.3) |
205.7
(4.5) |
247.3
(5.1) |
303.9
(5.9) |
369.4
(7.0) |
| Community services |
1.218
(31.6)
|
1.146.9
(26.8) |
1.181.2
(26.1) |
1.237.3
(25.4) |
1.291.6
(25.2) |
1.377.9
(26.0) |
| TOTAL |
3,862.9
(100.0) |
4,285.4
(100.0) |
4,525.5
(100.0) |
4,877.4
(100.0) |
5,122.83
(100.0) |
5,298.7
(100.0) |
Source: ILO-ETM a from INE data (national employment survey, October-December each year, combined/new series).
2.5.Trade unionism in the nineties and its composition: organization and membership
By 1990, the structural conditions and trends (sectoral distribution, level and pattern of employment, wage structures, dynamic
economic areas, etc.) which had been taking shape after the 1981-1982 crisis had been overcome, and which acquired their final
shape round about 1986, had been consolidated and were to remain more or less unchanged throughout the whole period from 1990
to 1998. Thus the characteristics and composition of the social base and the socio-economic conditions in which trade unionism was
to develop its activities in the period covered by this study had already been set. What caused a change in the scenarios was the
political factor, with the end of the authoritarian government in March 1990 when the country's first democratic elections for
seventeen years brought President Patricio Aylwin and the centre left coalition, the Concertación de Partidos por la Democracia, to
power.
This political factor would be significant in creating space for various social and political players to express their views, hitherto
rather restricted by the previous regime.
In the case of trade unionism, one of the significant effects was the rapid growth in trade union membership during the first three
years of the democratic government, a time when unionization rose by some 25 per cent compared with the end of 1989, reaching a
figure of 724,065 members in 1992 against 507,616. Subsequently, the growth in membership levelled off or fell somewhat, with
some 600,000 at the end of 1998 (12 per cent of the workforce and 17 per cent of wage-earners). Trade unions, for their part, almost
doubled in number between the end of 1989 and the end of 1998, from 7,118 to some 13,000. However, although their number
increased, the downward trend in average size, which had already begun under the military regime, continued. The average of 84
members in 1980 had fallen to about 67 by 1998.
It should be noted that the recovery in membership and trade unions had already started in 1984, parallel to the recovery from the
1981 economic crisis and the political processes of 1983 onwards, a period when there was a high level of social protest against the
military regime. However, the largest quantitative leap occurred, as noted above, during the first phase of the democratic government
that succeeded the military government.
Despite all this, the recovery of trade unionism to 12 per cent membership of the workforce was not enough to offset the fall in
membership and organizations compared with 1973, the year when the rate of unionization of the workforce was almost 32 per cent,
the highest since the late twenties when trade unions were legally recognized and constituted in the country.
Furthermore, while the economic sectors in which trade unionism had traditionally developed recovered their positions in the second
half of the eighties and continued to do so in the nineties, both in terms of employment and their relative weight in the economy
compared with the period of most acute change (1975-1981), the recovery had two features which meant that the process did not
necessarily result in the re-composition of the same type of trade union movement as had existed up to the beginning of the seventies
or a reproduction of the social conditions in which it had developed.
The first of these was that although the sectors in which trade unionism had traditionally built its core had recovered, their relative
importance in economic and trade union terms had changed compared with the early seventies. The most significant change was in
manufacturing. In 1996 it represented 16 per cent of employment compared with 26 per cent in 1973, and in terms of unionization, by
1997, unionization in the sector was 23.8 per cent of the total, against 31 per cent in 1973. At the same time, the service and trade
sectors increased their relative importance in the economy and also in the pattern of unionization, while that of mining and
construction, two other key sectors in trade union organization declined.
Total trade unions and membership at national level
(1980-1996)
| YEAR |
National Total |
|
Number of Trade Unions |
Percentage change over previous year |
| 1980 |
4,597 |
|
| 1981 |
3,977 |
-13.5 |
| 1982 |
4,048 |
1.7 |
| 1983 |
4,401 |
8.7 |
| 1984 |
4,714 |
7.1 |
| 1985 |
4,994 |
5.9 |
| 1986 |
5,391 |
7.9 |
| 1987 |
5,883 |
9.1 |
| 1988 |
6,446 |
9.6 |
| 1989 |
7,118 |
10.4 |
| 1990 |
8,861 |
24-50 |
| 1991 |
9,858 |
11.3 |
| 1992 |
10,756 |
9.1 |
| 1993 |
11,389 |
5.9 |
| 1994 |
12,109 |
6.3 |
| 1995 |
12,715 |
5 |
| 1996 |
13,261 |
4.29 |
| YEAR |
National Total |
|
Membership |
Percentage change over previous year |
| 1980 |
386,91 |
|
| 1981 |
395,951 |
2.3 |
| 1982 |
347,47 |
-12.2 |
| 1983 |
320,903 |
-7.6 |
| 1984 |
343,329 |
6.9 |
| 1985 |
360,963 |
5.1 |
| 1986 |
386,987 |
7.2 |
| 1987 |
422,302 |
9.1 |
| 1988 |
446,194 |
5.7 |
| 1989 |
507,616 |
13.8 |
| 1990 |
606,812 |
19.5 |
| 1991 |
701,355 |
15.6 |
| 1992 |
724,065 |
3.2 |
| 1993 |
684,361 |
-5.5 |
| 1994 |
661,966 |
-3.3 |
| 1995 |
637,57 |
-3.6 |
| 1996 |
655,597 |
2.83 |
Source: Department of Labour
The sectors that increased their significance in the composition of trade unionism did so, as we have seen, against a general
background of a drastic reduction in the pace of unionization. In addition, however, these are sectors that are typically more dispersed
and have less of a tradition of involvement in national trade unionism and trade union federations. Thus, while there was significant
growth in those sectors, it was not necessarily a factor in strengthening trade union activities in Chile at national level.
| |
Unionized workforces by sector |
Unionization as a total of the unionized
population |
| |
1972 |
1997 |
1972 |
1997 |
| Manufacturing |
342 |
169 |
293 |
238 |
| Mining |
1.2 |
0.4 |
8.3 |
5.96 |
| Construction |
13.2 |
9.8 |
3.6 |
6.6 |
| Trade |
22.16 |
9.9 |
10 |
15.17 |
| Financial services |
0.6 |
8.1 |
2 |
4.8 |
| Community, social and personal services |
1.4 |
6.16 |
24.7 |
13.8 |
| Transport |
27.4 |
22.8 |
8.2 |
14.6 |
Source: own preparation from data of Isla, Tarud (DERTO). University of Chile and Department of Labour
The second characteristic concerns the sectors where trade unionism had traditionally developed, as in most of them during the
twenty or so years from 1973 to 1990 there were major changes in technology, forms of organization of labour and management of
enterprise and services. Labour markets became considerably segmented and conditions of access to them varied in terms of technical
and educational qualifications. Also of crucial importance was the application since 1980 of highly flexible and deregulatory labour
legislation on the one hand, accompanied by many aspects that restricted trade union activity, which created a quite different
institutional framework, indeed the reverse of the one in which the trade union movement had been developing hitherto. Some of the
major aspects of the legislation were reformed after 1990, especially in allowing more scope for trade unions and collective
bargaining, but there were still several issues that continued to restrict trade union activities and collective action by workers in
general.
These two characteristics, together with entry into the international scene and the market economy, had a powerful influence in
bringing about change in the social, technical and cultural conditions under which trade unionism had to operate.
CHAPTER II - TRADE UNION RESPONSES TO GLOBALIZATION IN CHILE IN
THE NINETIES: DEMOCRACY AND DEVELOPMENT
As we argued in the introduction to this paper, in the case of Chile, the issue of trade union responses to the challenges and structural
changes resulting from entry into a globalized economy and a world that had become politically internationalized, were strongly
marked by the fact that the process had begun in the early seventies under an anti-trade union military dictatorship, a feature of which
was profound and drastic structural and institutional change, indeed upheaval, on a massive scale imposed in an authoritarian manner
in a relatively short period of time.
As a result, the actions and strategies of trade unionism were primarily based on political lines, designed to intervene in national life
as part of the restoration of political democracy, firstly, and subsequently, from the early nineties, to consolidate and entrench their
position. They thus devoted major efforts to seeking changes in the existing economic model, which, although moderated in concept,
continued in many important aspects that made it appear indistinguishable from the policies pursued by the military government.
In this context, the national organization of Chilean trade unions (CUT) and the leadership generally at federation and confederation
level gave priority to policies and strategies aimed at influencing global social policy issues, rather than those aimed at developing
ways of restructuring their traditional organization and methods of recruitment in the face of changes in the nature of their social
base. That does not mean, however, that such problems did not have a place on the trade union agenda, albeit with a lower priority, in
practice at least. They, too, will be examined in this study.
1. Policies and strategies directed towards global issues
Three main focuses of trade union action can be distinguished in this area in the nineties: policies aimed at social cohesion and social
alliances, policies aimed at the institutionalization of labour, labour legislation and social security and policies aimed at promoting
participation and social rights in social and economic development.
1.1. Social cohesion
The National Agreements. Around April 1990, the most representative workers' organization (the CUT) and the Government decided
to invite the main employers' organization to seek agreement on a joint document in which they expressed their positions on the issue
of labour and its relationship with economic and social development policies, identifying areas of consensus which they were in a
position to build. The proposal by the trade unions and the Government was to set out the main rules of the game, which could be
accepted by the parties as the framework within which the labour issue could be discussed with the advent of the first democratic
government for 17 years.
The document, under the title of "National Tripartite Framework Agreement", signed in May 1990, was the result of that first
meeting. Through the CUT, the trade unions played a significant role, since, although their positions were generally critical of what
they called the "economic model", they were ready to be open-minded in order to facilitate common ground with employers and the
Government in order, in turn, to obtain, from the former especially, an open approach to labour issues and questions of social equity
linked to economic growth.
The document to which the Agreement gave rise was of crucial importance, because it was unprecedented in Chilean experience. Its
main value was that it served to send a signal of the readiness of the trade unions, employers and the Government to agree, at least on
the main directions of social and economic development, and the will of the parties to discuss them in a framework in which they
were willing to take part. This signal certainly helped to strengthen the process of transition to democracy.
It should be explained that the agreement was the result of a process of mutual concessions by the employers', trade union and
government sides, so that its content can be seen as a kind of "memorandum of understanding", rather than full agreement on ideas of
social and economic development. In fact, trade unions and employers continued to disagree on many subjects, but they agreed to
moderate their disagreements as a gesture of readiness to engage in dialogue. The trade unions in particular moderated their positions
on many points as an expression of the political will to facilitate the agreement, which they regarded as important in contributing to
the success of the democratization process that was beginning in the country.
In particular, they began to look favourably on the role of private enterprise in economic growth and development, as well as the
need to consider the demands of an open and competitive economy as a framework for social and labour policies. At the same time,
they maintained that a necessary condition of the foregoing was special concern to protect workers during the process of change and
adjustment, greater participation in the enterprises and its profits, a better balance in labour relations and recognition of the role of the
trade unions at grass roots, sectoral and national level, and making workers' access to the fruits and opportunities of growth a priority
goal.
The employers, for their part, acknowledged the need to improve labour relations in terms of more cooperation, the need to ensure
compliance with labour and pensions legislation, they recognized workers' organizations as valid representatives and expressed their
readiness to examine those aspects of institutionalized labour that needed to be improved to promote labour relations of higher
quality and technical calibre. They also recognized the importance of developing policies to help workers obtain better access to the
opportunities of growth.
The Framework Agreement also sought to agree the adjustment to the national minimum wage for the period 1990-1991, as well as a
range of issues to be discussed in future dialogue.
The Agreement opened up a readiness to engage in tripartite discussions and helped to ensure that proposed reforms or improvements
of labour legislation prepared by the Government could then be discussed in consultation with the social partners. Although the
Government did not achieve full agreement with either the trade unions or the employers on their proposals, the experience of
dialogue made it easier to achieve consensus in parliament when they were submitted to the Congress. In fact, it set a precedent for
tackling labour issues in a climate of dialogue and the search for agreement, breaking down the employers' prejudices and opposition
to the possibility of change on these issues. This influenced the readiness of Congress to discuss and approve proposals submitted by
the Ministry of Labour, under the Government's labour reform programme.
Three agreements were signed in the years following (1991, 1992 and 1993), which had more practical impact than the first. The
main subject was the minimum wage, especially the restoration of the linkage with average wages, and other specific issues. The
agreements did not address any other major themes and in many of them it was not possible to finalize everything proposed, other
than the criteria for setting the minimum wage, namely estimated future inflation and average productivity in the economy. This was
a significant achievement, since it allowed the identification of a precise formula, consistent with the objectives of growth and
stability. However, despite their more practical nature, the agreements that followed the first were a focus of constant dialogue and
kept alive the idea of social cooperation as a method of high political and social value. That did not, however, prevent conflicts
between the parties and the Government, some of them quite serious, but the forum for dialogue was preserved as a recourse
validated by the partners.
Trade unionism, led by the CUT, kept up this strategy of social cooperation for four years, even though internally it faced constant
tensions concerning its validity, since some sectors thought that it was not yielding the results they had hoped for, arguing that the
employers were not behaving in accordance with what had been agreed in the first "Framework Agreement". In particular, that was
because the proposed reforms to the |
