Will COVID's Boost For Labor Unions Last? Check The Swedish Model
The pandemic has spurred a resurgence in labor unions around the world. But their return to prominence also raises the question of whether they’re the best way to protect workers in a globalized world.
Unions around the world have been on a steady decline over the last half-century: crippled by globalized economics and confounded by the accelerating changes in our work culture, average trade union membership in OECD countries has fallen from 30% in 1985 to 16% today. In the U.S., one-third of workers belonged to a labor union in the 1950s — a far cry from today’s 10.7%, including a meager 6.4% of private-sector workers.
A pandemic was bound to shake the status quo for the world of labor: from a newfound appreciation for what we’ve come to call “essential” workers to a series of layoffs in other sectors to the Great Resignation, which saw individuals reassess what they really want from their career.
But the uncertainty of COVID-19 has also made the imperative to protect workers undeniable — and unions across much of the Western world are doing their best to ride the wave.
The rise and fall and rise of organized labor
In Spain, unions have organized to protect the health of employees returning to work. In Belgium, collective labor agreements were signed last year to deal with suspensions of work contracts. In Denmark, union and business groups have led the way in negotiating wage compensation and job preservation schemes. In France, unions spanning the political spectrum banded together in January to stage a school workers strike of historic magnitude. And in the U.S., where Joe Biden has pledged to be “the most pro-union president you’ve ever seen,” union approval reached 68% in 2021 — the highest on record since 1965.
The Swedish system has been labeled in America as “socialism”
But with their return to prominence also come questions of whether old-style labor unions are actually the right mechanism to ensure the best conditions for workers, with the debate evermore divided along partisan lines. In the U.S., a 2021 Pew survey shows that 74% of Democrats now say labor unions have a positive effect on the country, up from 66% in August 2019. The share of Republicans and GOP leaners who say unions have a positive effect has fallen from 44% to 34% during the same period.
The most union-dense place in the world
And yet, as critics voice concerns over labor market rigidities and hampered employment rates, one of the union-densest places in the world, Sweden, tells a very different story.
More than eight decades ago, a treaty was signed in Sweden. Following pressure from the ruling Social Democratic Party to resolve market conflicts over wages and rights, Sweden’s employers’ federation and the rapidly growing workers’ union federation signed a historical treaty that remains the basis of the country’s industrial culture today.
What became known as the Saltjsöbaden Agreements of 1938 cemented the Swedish social norm that employers and workers will conclude agreements without interference by the government. That policy is still in effect, which is why, for example, Sweden still has no minimum wage today.
As such, the Swedish system, which has typically been labeled in America as “socialism,” is actually a form of corporatism – the organization of society by professional groups, such as agricultural, labor, scientific or guild associations.
Signing the Saltjsöbaden Agreements in 1938
Sweden isn't a welfare state
The Saltsjöbaden Agreement garnered attention from the outside world as it ushered in a Swedish era marked by decades of economic growth, improved living standards and minimal industrial conflicts. And it also created — for good and bad — a national culture centered on the importance of hard work and pulling one’s own weight.
In that sense, Sweden isn’t a welfare state in the American meaning; the social contract isn’t about charity but about the freedom of the individual, social contribution and reciprocity — where you work and pay your taxes in exchange for your freedom. From a U.S. political perspective, that is closer to the Republican party line than the Democratic one.
Unions have struggled to figure out where they fit into this new globalized era
It should be said that the now famed “Swedish model of agreement” took root in the special context of post-War economic boom years, in a small country largely untouched by the ideological tides that divided 20th-century Europe. It’s also a fact that Swedish unions, too, have lost much of the vigor that allowed them to transform the country into a model for pragmatic progressives around the world.
Unions in a globalized world
Indeed, after the Social Democratic party’s grip on Swedish politics started to slacken in the mid-1970s, unions have struggled to figure out where they fit into this new globalized era, and repeatedly missed opportunities to regain their relevance — a ripe example being their feeble efforts to negotiate fair labor conditions with tech giants like Facebook and Amazon.
Still, the last two years saw an increase in Swedish union membership — reversing a 25-year trend. That also comes at a time when the European left is experiencing something of a revival — with social democrats having secured victories in numerous countries in the last few years, including Norway, Denmark, Germany and Portugal.
Today, the question is whether progressive parties will also manage to re-establish a connection to the organized labor that was once considered the bedrock of their politics.