Uncertainty - A New Social Malaise:
From Labor Security to Insecurity

The world is changing for many reasons and in many ways, one major recent change is the rise in uncertainty stemming from increased labor market uncertainty, which is widely mistaken to present enhanced "flexibility." The level of uncertainty, i.e. diswelfare, for individuals in new modern market economies is surging to new heights, to such an extent that destructive forces are being unleashed, which not only threaten the way we live, but also the reproduction of our societies and economies-by threatening the reproduction of a sufficient labor force (due to a drastic, long-term decline in birthrates). There are at least four major factors, which are interrelated and interconnected to each other:

First, the phenomenon of economic and social modernization is accompanied by important social developments and changes-urbanization, relocation, migration, disintegration of family and community networks (individualization), and consumerism (lack of savings/future-oriented lifetime planning). This over time causes a weakening of the position of the individual in society.

Second, the average size of families has declined, and new family patterns, such as, nuclear families and single-parent families emerged. That amounts to a further weakening of the family support system and an increased vulnerability of the family and its individuals.

Third, a long period of below-replacement population growth has brought on a two-fold dilemma-a massive increase in the share of the elderly in total population, and a dramatic decrease in the share of children, and hence later on a permanent decline in working-aged population. This, as a whole, increases the vulnerability of the individual (especially the elderly) and the family.

Fourth, since the early 1990s a new phenomenon has started to change the way we live-that is, economic globalization. The ILO noted that

"although causation is by no means clearly established in all cases, globalization has been accompanied be a host of social problems, many of which are related to the world of work (ILO, 2000)."

The twin promise of job creation plus swift redeployment of displaced workers has not been fulfilled. In the aftermath of globalization, there are a large number of "acute social pains." They are caused, in the main, by new job insecurity, lower wages, and flexible, short-term, and irregular work contracts, which had a tremendous effect on our lives-not only working lives, but also, and especially so, our family lives.

Globalization has increased the risks of economic downturns. With it came unemployment and poverty, which endanger social protection and future progress in social development as a whole.

We live in a new world of risks. One that is only slowly to be understood by contemporary social scientists, and the common people. The variety of new risks for the individual in a post-modern, globalized world is great, and includes e.g.:

(1) economic risks (unemployment, underemployment, low wages, loss of employment security, loss of social security coverage/benefits, economic depression, hyper-inflation, etc.);
(2) individual risks related to lifecycle (marriage, childbirth, care needs, old age, death, etc.);
(3) health risks (diseases, accidents, disability, lack of exercise, over-/underweight, stress, substance abuse, etc.);
(4) family risks (violence, neglect, divorce, separation, law suit, loss of family support, etc.);
(5) social or governance-related risks (social exclusion, discrimination, crime, violence, corruption, political instability, terrorism, etc.); and
(6) environmental risks (droughts, earthquakes, floods, landslides, rains, storms, tsunamis, etc.).

By all accounts, economic uncertainties exercise a direct impact on individual's lifetime choices (e.g. marriage, number of childbirths), health risks (e.g. stress, depression, lack of good nutrition), and family risks (e.g. separation, divorce, lack of family support).

The process of globalization, while potentially leading to higher levels of economic growth, has also greatly increased poverty, social inequality, and economic insecurity of the individual and their families. Welfare state programs and legislation have been crucial in securing greater cooperation, stability, productivity and efficiency of the market economies.

The welfare state served as a crucial building block for society and, hence, the economy. It is no coincidence that the most open-and successful-economies are those with the highest levels of social protection (cf Sweden, the Netherlands, Austria).

The welfare state was crucial in not only holding things together but also in facilitating and protecting high levels of economic growth. This has been the case in the postwar era of economic boom in the industrialized West, during the recent years of globalization, and it will continue to be so even more in future.

In the light of dramatic socio-demographic and economic changes, we may expect the problem of economic insecurity to escalate a great deal in the years and decades ahead of us, as the processes of population aging and economic globalization/liberalization (trade regimes; financial, production, and labor markets) greatly increase the extent and the impact of economic uncertainties that change our lives.

"Indeed, international agencies and social scientists are now speaking about 'risk reduction strategies' more than 'poverty reduction strategies.' Risks may be unequally distributed, but many of them cut across lines of class, nationality, color and creed, knitting people together in solidarity" (Silver, 2004).

There is new need-and there is new opportunity-in catching up with recent societal and economic developments. Many of the new risks posed by economic change can in fact be prevented or mitigated, by means such as, for instance:

(1) labor protection,
(2) social insurance,
(3) savings schemes,
(4) investment in human capital,
(5) economic redistribution (from rich to poor),
(6) employment policies and programs, and
(7) macroeconomic management.

One of the greatest tragedies of modern society is the apparent disbelief in the welfare state, and its policies and programs-and hence in the possibility to prevent social disaster and to support economic growth by way of welfare state policies, and societal policies in general.

Today, the work place (i.e. the labor market) has become a key battleground for the neoliberal assault on the welfare state. Social conditions are degenerating, as families lose social security coverage and benefits, more and more individuals become bankrupt, the young generation does not dare to form new families and/or have more children (due to insecurity caused), the number of divorces is climbing up (due to new economic difficulties and insecurity), people stop buying their own houses and apartments (as observed in e.g. Japan), people use up all their savings, etc.

It is, hence, up to political actors, such as, labor unions, political parties, international organizations, social movements, and social welfare advocates to solve and prevent the new problems caused, and those that are yet to emerge (i.e. yet to be felt).

"Intensified international economic competition has created pressures on enterprises to seek more flexible employment arrangements that are often less secure and provide fewer social benefits than regular job. This process has often been intensified by misguided labour market deregulation that has ignored more consensual and productive approaches to responding to heightened international competition. Another problem area has been the rise in income inequality that has been observed in many developing and industrialized countries" (ILO, 2000).

Labor markets and systems of labor legislation/regulation need to provide security rather than provoke insecurity. Indubitably, the ideological one-way street of neoliberalism, and quiet acquiescence to it, will further destroy labor security, and concurrently family security.

In South Korea, for example, the tragedy of reform of labor contracts in particular has unraveled new social problems of unforeseen extent. Today, more than half (i.e. 56 percent) of the Korean workforce, though working full hours, live with no job security. While being exempt from social security protection, the wage of irregular male workers has dropped to 56 percent of that of regular male workers-for women the situation is even worse as irregular women workers only receive 36 percent of a regular salary, while doing the same work (for the same hours) as their regularly employed counterparts (KH, 2004; Kim, 2003).

"The flexible labor policy has no connection with efficiency ... Therefore, the introduction of readjustment dismissals central to the flexible labor policy is an anti-labor policy oppressing the survival and basic labor rights of the workers (KWW, 2000)."

"With shrinking formal employment, workers bear an increasing direct burden of financing social needs, with adverse effects on their quality of life. That burden may also undermine the capacity of enterprises to compete in the global economy (ILO, 2001)."

To be sure, instead of increasing the competitiveness of economies and enterprises, the lowering of wages and the cutting back of social benefits reduces economic growth due to lack of consumer demand for surplus goods and services in the short run (by loss of purchasing power), as well as the undercut capacity of development and reproduction of labor in the long run.

by Christian Aspalter



Asian Development Bank (2001), Social Protection in Asia and the Pacific, ADB: Bangkok.
ILO, International Labor Organization (2000), Decent Work and Poverty Reduction in the Global Economy, ILO: Geneva, Switzerland.
ILO, International Labor Organization (2001), Social Security: Issues, Challenges, and Prospects, ILO: Geneva, Switzerland.
KWW, Korean Women Workers Associations United (2000), Korean Women Workers and Globalization, Korean Women Workers Associations United, Seoul, October.
Kim, Tae-Yeon (2003), The Struggles of KCTU Against Neoliberal Restructuring After Economic Crisis, and Perspectives on Asian Workers Solidarity, KCTU, Seoul.
KH, Korea Herald (2004), various issues.
Silver, Hilary (2004), Globalization, the Challenge of Insecurity, and Global Social Policy, paper presented at Conference on Globalization of the Welfare State, Hanse Institute of Advanced Study, Delmenhorst, Germany, February 8.