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Conditions of the labor market that encourage foreign investments in Central and Eastern Europe

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  1. Introduction
  2. The specific workforce
  3. The decreasing role of trade unions in the construction of a legal framework
    1. The presence of strong trade unions
    2. Decrease in the unionization rate
    3. The weak position in the process of decision-making
    4. The absence of big and strong trade unions in Central and Eastern Europe
    5. The structural difficulties of trade unions
    6. The position of the EU regarding the issue
  4. The flexibility of work organization
    1. The problem of the dismissing role of trade unions
    2. The issue of the organization of work
    3. The method of Taylorism
    4. Quicker and efficient methods
  5. Dichotomy between the EU 15 and most of the Eastern new members
  6. Conclusion
  7. Sitiography

Today, a well known economic phenomenon is that the foreign investments in the Central and Eastern Europe have been flooded, since 1989. Amongst many other economic data, we could include that in 2003, 29 billions dollars were invested by foreign companies. This figure is not easy to achieve, however, we could add that from 2002 to 2003, the investments grew by 20%. Moreover, it grew when the general investments all over the world were decreasing. Since the beginning of the process of economic and political liberalization of these countries in the year 1989, these investments have helped Central and Eastern European countries to thrive. The investors mainly come from Western Europe. This phenomenon is thus at the core of the European economy.

[...] The weakness of trade unions in Central and Eastern Europe could contribute to create a new model of labor market, whose particularities make it more attractive than the Western market. Since 1989, the unionization rate has strongly decreased. Trade unions have known deep structural transformations. Paradoxically, while they adapted to the new labor market and while workers needed to be more protected than ever-, they were at the same time, struck by a massive de-unionization. This was particularly the case in Hungary and Czech Republic. [...]


[...] Conclusion Legislations, namely social legislations, are hence at the very centre of the factors that foster foreign investments in Central and Eastern Europe. Indeed, the way social legislations protect the worker, eastwards and westwards, is the basic element that settles a discrepancy between the two parts of the continent. Indeed, legislation entails flexibility concerning timetables, easy hiring and firing, relations between managers and workers, work organization Norms and rules are really a basis: from that point, conditions have been built so as to appeal to foreign investors. [...]


[...] The specificity of Eastern labor market, that we just emphasized, is at stake, because the implementation of European directives could have considerable consequences, by destructing differences between Eastern and Western labor market. The position of the EU regarding this issue is without any ambiguity. European institutions are strongly encouraging social dialogue between trade unions and employers. Moreover, some European trade unions have been created, such as the Confederation européenne des syndicats We can also expect integration, in the EU the introduction of the Western model of representation and a new ?social partnership?. [...]

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