Prospects of workers in the automotive industry and social partners responses under new technologies deployment

Monika Martišková, Charles University

New technologies, sometimes referred to as Industry 4.0 technologies, may have disruptive effects on economies, especially in those countries that rely on manufacturing to a large extent. Central and Eastern Europe (CEE) represents a region where the automotive manufacturing has become a crucial segment of the economic growth. The arrival of foreign direct investments solved several difficulties this region had been experiencing in the transition period in the 1990s, such as high unemployment rates, stagnant GPD growth and the lack of available technologies and knowledge. However, new technologies may downscale manufacturing advantages by having strong and mostly negative impact on working conditions and the number of jobs in this sector.

There are at least three main reasons for raising the concerns about the impact of new technologies on working conditions. First, the implementation of new technologies will reduce demand for manual work and decrease wages of manual workers.  Second, because of the labour cost reducing character of technologies, cheap labour, the main competetive advantage of the CEE region, may become obsolete resulting in reallocations either to mother countries or to cheaper locations.  The third concern is related to the quality of working conditions associated with the increasing level of control, deteriorating job stability and decline in complexity of duties in manufacturing jobs (e.g. the “feeding-machines positions”).

The present paper studies the effects of new technologies on working conditions by using an example of automotive industry in Czechia based on the secondary data resources and qualitative interviews conducted in the subsidiaries of multi-national corporations (MNCs) and with representatives of social partners at the sector level in 2018. In the paper it is argued that the new technologies´ expected impact on working conditions, wages or job offers are only partially visible nowadays. This situation is associated with the dependent position of subsidiaries in introducing new technologies in production that stems either from limited competences assigned from the headquarter or from local management limited capabilities to implement new technologies. The economic boom experienced in the CEE countries, including Czechia, provides on the one hand incentives to robots´ utilization because of labour shortage, but at the same time it hampers the new technologies implementation because of the production overload and time and capacities constraints to prepare the changes at the firm level.

In light of this development, social partners are aware of expected changes in working conditions, but at the same time, they remain passive in pushing for measures that would moderate anticipated impacts. A broader concept of economic transition is addressed mostly by the business sector actors while trade unions struggle to be involved in determination of policy instruments that would ensure the smooth transition. One of the most important aspects of successful transformation, workers´ participation on life-long learning, is not promoted neither by the social partners, nor by the government.

In the paper, we discuss the puzzle of current improvements in working conditions and wages and expected massive deterioration of quality and quantity of manufacturing jobs. The prospects of workers in the Czech automotive industry do not seem to be dark for now, but the near future remains to be in question that local actors are not fully capable to answer.