Rina Agarwala was familiar with the literature about the effects of the increasingly widespread practice of informal labor on the workers involved. The research was pessimistic, predicting the death of the labor union model that has protected workers around the world.
In large part because of globalization, the pressure to reduce costs is great, and many industries are cutting labor costs by hiring more and more workers informally—through subcontractors—thereby avoiding labor laws requiring minimum wages, benefits, and job security.
It’s also true, Agarwala says, that throughout the world, government’s role in providing welfare services is at a historical low. “As a result of these two trends, essentially we’re increasing the number of unprotected workers,” she says.
Still, she wasn’t convinced that the “race to the bottom” literature, as it’s known, was the whole story. Her hunch proved right, as she discovered while working for a non-governmental organization in India. She found that the NGO, the Self-Employed Women’s Association, was a trade union for women workers. “These women were getting together, they were part of a trade union,” she says. “Everything I saw there was so counter to what I’d read.”
So, when she began her graduate work at Princeton University, Agarwala, a new assistant professor of sociology in the Krieger School, set out to explore the strategies being used to organize informal workers. She focused on the working poor in India—those making less than $2 a day—and on women, because, she says, “women are far overrepresented in the very lowest rungs of industry.”
What Agarwala found, which she detailed in her recently finished dissertation, “From Work to Welfare: Informal Workers’ Organizations and the State in India,” is that workers are indeed organizing, but they’re now making demands of the state, not their employers.
“They’re using electoral politics—the power of their votes—and the types of demands are very different from traditional labor union demands,” Agarwala notes. Workers are lobbying for “good old-fashioned welfare benefits” such as educational scholarships for their children, health care clinics, and funeral money. Politicians are granting the demands in exchange for votes, an arrangement that’s attractive for government leaders as the state promotes—or at least turns a blind eye to—informal employment as a means of being competitive in the global market.
Agarwala conducted more than 200 interviews with government officials and labor union leaders in three states and about 140 interviews with women working informally in the tobacco and construction industries. The workers typically earned their wages rolling bidis—traditional Indian cigarettes—in their homes, or cleaning cement and carrying materials from one end of a construction site to another. “It’s completely unskilled manufacturing…and very basic manual labor,” she says.
Of India’s 400-million-person labor force, Agarwala says, 93 percent are employed informally. She says high rates of informal workers exist also in some Latin American and African countries, and they’re increasing in the United States, Italy, and Spain, among other nations.
The numbers make Agarwala’s findings all the more significant, then, as the world struggles to meet the challenges of globalization. “I am very optimistic,” she says, acknowledging that the gains informal workers have made aren’t as great as those made by traditional labor unions. “It’s not a perfect solution, but it gives us a place where we need to start looking for change, and that is among the people.”