UBI adds jobs in the short term and increases worker bargaining power
Yannick Vanderborght 18, Professor of Political science at Université Saint-Louis – Bruxelles (Belgium), where he belongs to the Research Centre in Political Science. He is also a guest Professor at the University of Louvain, and a member of the Hoover Chair for economic and social ethics, “The Progressive Package: Getting Unions Behind Basic Income”, Green European Journal, October 17 2019, https://www.greeneuropeanjournal.eu/the-progressive-package-getting-unions-behind-basic-income/, NSH-NT
One of the reasons why unions are sceptical is because of uncertainty over the effects on wages. Many advocates expect that degrading jobs or unattractive jobs with low training content or precarious conditions will find fewer takers with a basic income. Bertrand Russell, in a 1918 book called Roads to Freedom, wrote, “One great advantage of making idleness economically possible is that it would afford a powerful motive for making work not disagreeable; and no community where most work is disagreeable can be said to have found a solution of economic problems.”
With basic income, people have the power to say no. When people have the power to say no, you have several solutions: replace the workers with machines, improve working conditions, or pay higher wages. This means that a basic income might create jobs, as the payments can be topped up with other earnings, but it will not create jobs at any cost. Much will depend on the amount. Your power to say no is not very high when you have 200 euros. It’s much higher if it’s 500, 600, or 700 euros. In Belgium, for instance, minimum income through social assistance is quite high. For people who are living alone, it’s 900 euros a month. But it doesn’t give you the power to say no because, at least in principle, you must be available for work.
Basic income also gives people have the power to say yes. Some jobs that don’t even exist because they are too expensive for employers could become profitable thanks to the basic income. But they will only find takers if they are promising and attractive enough.
Do you think the experience of minimum wages and trade unions might be relevant for basic income? Many unions initially opposed a minimum wage, but over time came to accept them.
In some countries unions opposed a legal minimum wage because they preferred to be in charge of setting the wages through collective bargaining agreements, and to be able to negotiate higher wages for certain sectors. The level of a basic income would be set by the government, hopefully in strong legislation, not by unions and would profoundly affect the labour market without any union control. You could however imagine unions having a role in setting the basic income as part of a negotiation with employers and the state.