Address: European Cooperative House
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The Future of Work

24 October 2017

Speech pronounced by Giuseppe Guerini, President of CECOP - CICOPA Europe, in the framework of the EESC contribution to the ILO centenary initiative.

Firstly, I’d like to extend my warmest thanks to the EESC and the ILO for inviting CECOP-CICOPA Europe to take part in this extremely important conference. The future of work and the changes that are currently under way in companies are a crucial issue for our 50 000 cooperatives and for our 1.4 million workers, most of whom are also members of these cooperatives and therefore entrepreneurs by association.

So, for us, to talk about work is to talk about the very heart of what we do. What we are seeing in the workplace, based on the experiences in Europe’s cooperatives, is a process of radical change, and this has been highlighted at this conference.

Admittedly, the first thoughts that spring to mind when we speak of "the future of work" are of new technologies, the digital revolution, the information society and automation. I will return to these areas, which others have already talked about, later.

But I want to focus on some of the more "social" aspects of the future of work. As I see it, there are three major drivers of these changes:

• The growing demographic imbalance, with the ageing of the population and falling birth rates, leading to a reduction in the European working age population and a subsequent imbalance in the social security systems in many Member States.

• The radical transformation of the labour market, which has excluded the younger generation in large numbers and, in general, many vulnerable workers and women who remain on the margins of society.

• The growth in inequalities, not only in economic terms, but in terms of training, opportunities to access services and participate in civic life, has further aggravated disparities, as has the financialisation of the economy. We don’t have time to examine these three areas in more detail, but they are issues that pose great challenges for our cooperatives and, more generally, our societies.

These issues go hand in hand with – and force us to question – a number of major paradoxes: the working age population is falling, but the number of unemployed increasing; the world’s capacity to produce wealth is growing but inequality is also growing; the demand for innovation and flexibility is growing, but young people, who are the group most suited to change, are being marginalised from the labour market.

These paradoxes highlight the fact that one of the major problems affecting work – and economic wealth – is the ability to distribute it and allocate it in the best way. We believe that cooperatives, on the other hand, have shown their superior ability to withstand crises and, above all, to better protect jobs and therefore to distribute economic and human resources more effectively.

There is no doubt that some trends in new types of work made possible by new technology do create new employment opportunities. However, along with these opportunities comes a shattering of employment terms. The processes that have led to the globalisation of our economy and communications have broadened our horizons greatly, but also often greatly weaken the social fabric. The conduct of the financial economy, multinationals and, more generally, the predominant economic policies have fragmented the real economy and its fabric. The situation could be compared to the extraction of shale oil. Like the rocks that are shattered to extract oil, in this case social ties are shattered in order to extract value from peoples’ isolation or the contractual vulnerability of workers.

Take the example of certain e-commerce or transport management platforms, or hotel bookings platforms (which someone has mistakenly included as types of "sharing economy"), which are a new horizon for on-trend businesses. They often manage to maximise the sharing of business risk and capitalisation (by moving it onto independent worker-suppliers, who often find themselves in a weak position contractually), while optimising and concentrating most of the added value – and therefore the profits – in just a few hands. This phenomenon, coupled with the "financialisation" of the economy, fuels the illusion that it is possible to generate wealth without working.

However, we all know that if a few people manage to accumulate great wealth without working, it’s because many people elsewhere are working without earning. It is difficult for this illusory and damaging dynamic to become established in cooperatives, where workers are also the owners of their company and of their own work. Throughout the problems of recent years, cooperatives owned by their workers all over Europe have been better able to withstand crises, by protecting jobs, often sacrificing part of their profits and assets and drawing on capital reserves and assets accumulated during periods of growth.

In "financialised" firms, we have seen the opposite trend, with jobs sacrificed on the altar of dividends and shares. We certainly do not claim that cooperatives alone can redesign the welfare system or tackle unemployment, but it is vital that someone dreams of a social economy that can deliver sustainable development and social justice – because we are convinced that if we can dream about something, dreaming it together is the best way to achieve it. This is why we want cooperatives to be a means of putting the real economy back on track.

This also explains a certain hostility towards cooperatives that we sense in the attitudes of some political decision-makers and top managers at the institutions, who are more attracted by fashionable trends such as "social business" or the circular economy than by more established forms of social economy based primarily on the direct participation of stakeholders and workers. This does not mean that we should be afraid of innovation, or of the new technology or the social changes emerging as a result of the hyper-information society and digitisation.

On the contrary, we must instead develop the capacity to introduce them into cooperatives, which have a great potential for collaboration. This could be implemented on a grand scale with the help of new digital technologies. Some cooperatives are trying to develop digital cooperation platforms to relaunch the ideals of mutualism in an information society.

Our challenge should be to promote a welfare 4.0 and a mutualism 4.0 – not just industry 4.0 –, with the cooperative economy as a form of protection and a safeguard for the real economy, work and the social fabric. Of course, the digital revolution has a considerable impact on the organisation of work. In the years to come, we must commit ourselves fully to protecting the dignity of work.

This must begin by assuming the role of guardians – something that many cooperatives do but is still under-recognised and undervalued, as our workers know all too well. More generally, the issue of work will be increasingly concerned with how to support the digital transformation. In many cases, this transformation leads to the disappearance of "traditional" jobs, as well as the creation of new jobs resulting from technological innovations.

However, forecasts for this transformation predict a scenario which will leave a negative balance of millions of unemployed people in Europe if we do not develop different forms of governance for work and the economy. These forecasts are made on the basis of the predominant economic model, which continues to see labour as a cost to contain so that major shareholders can see a growing return on their financial capital.

But what we have to do is to consider the wealth that new technologies allow us to create – even without the contribution of human labour – as something that should be invested primarily in shared assets: welfare, culture and the environment. We therefore need a sustainability revolution to support the digital revolution. This would take the form of investments in renewable energy, reusing materials, caring for the environment, maintaining the landscape and shared cultural assets and, most importantly, caring for people.

These are all labour intensive sectors that cooperatives are already working in successfully and they have a higher percentage of women employees. However, it is essential that citizens, policies and institutions act to convert the economic model and gear it towards sustainability. We need a "social and ecological industrial plan" that creates the conditions to give work a future, reestablishing it as a key focus for economic development policies.

I believe that all of us in the cooperative movement can say or do something to ensure that people remain at the heart of the transformation currently under way in the economy and the business world. The United Nations also refers to the need for all people to be able to aspire to "decent work" in the 17 goals that it set out in its sustainability programme.

This must be done by making use of the capacity to create new "industry and innovation" through new technology, but also through the development of an economy that factors in environmental awareness and safeguards the environment. In order to achieve these goals, we need to revise the economic model and keep hold of ideals such as moderation and responsibility, enabling us to make the most of even the simplest of innovations, not just grandiose hyper-technological innovations whose importance is often exaggerated and oversimplified.

We have a great need for these forms of innovation in order to be able to meet growing care and social protection needs and to ensure that welfare in many European countries is financially sustainable enough. This demand for new services opens up fresh opportunities for cooperatives to engage in social innovation – as the social cooperatives in Italy have done, for example. These Italian cooperatives have managed to align their responses to changing needs with a simultaneous need to support new welfare spending capacity.

They have done this through their ability to involve a wide range of stakeholders who are themselves promoters of services and measures and have transcended the role of "user-consumer" to become directly involved in carrying out the services that they themselves identify within their families and local communities. This ability to innovate and create will be needed more and more over the next few years, as it will be increasingly necessary to share greater responsibility with service users, by increasing levels of participation and sharing, not least so as to ensure the sustainability of services that will probably receive less public funding. This will require us to look for a diverse range of funding sources for services, relying heavily on the cooperative model and on a revaluation of the mutual model.

This new form of managing work and the economy should be geared primarily to reducing inequalities. These inequalities are discussed at every political and economic forum and they fill up the pages of reports and analyses by the central banks’ research centres and institutes. However, they do not attract many tangible proposals. Small-scale and large-scale innovation that we can increasingly share and make more accessible thanks to new digital technologies, confirm what has come to be termed the knowledge-based and information economy.

We must, however, avoid managing knowledge-based capital (data, information, knowledge and innovation) as though it were money, aiming to accumulate and collect it and ascribing to it a value of its own so that it is no longer a means of exchange. Knowledge-based capital grows only if it is shared and disseminated, not if it accumulates. This should also apply to the concept of digital knowledge. We need to find a way of establishing a digital-knowledge economy that is able to create shared value, generating a culture of solidarity and a digital economic democracy: a new type of "landlord" is emerging who –instead of owning land – owns enormous amounts of data.

The new system of governing work also requires us to make the lion’s share of this data accessible and shareable through cooperative forms of governance, thereby avoiding the prospect of adding enormous inequality in access to information to the many other growing inequalities. We know that it is not within our reach to reduce the inequalities resulting from global finance.

But we can take practical steps in response to the growing demand for equity and social justice in our local areas. As is wellknown, cooperatives are not businesses that relocate jobs, but – on the contrary – embed them in local areas. Thinking of regions, cities and local communities as places for interaction is a prerequisite for building work and meeting places for people, and these are the bedrock of social cohesion. Building places to live, not just spaces to reside or work in, but communities where lives meet.

To achieve these intentions today, in an era of great change, requires envisaging cooperatives as organisations where people inhabit spaces in order to create social innovation.

We in the cooperative movement feel an increasing responsibility towards people who are in danger of being marginalised. Among those increasingly facing this risk we particularly identify:

• Young people, who, in terms of their access to work, education and training and health and wellbeing, see the gap growing between those who have a lot and those who have little or nothing.

• Immigrants – without whom the care sector in Italy would collapse –, whom we continue to profile and see in relation to a situation of emergency, and not as a human and economic process which (once again) has its origins in the unequal distribution of income and opportunity between different areas of the world. Immigration also continues to be undervalued in terms of the economic potential that it offers and could offer.

• The unemployed and very low-income earners, who have had even their identity crushed by a revolution in the world of work that has fragmented places and forms of work.

• Women, who are still excluded from the labour market in too many countries.

The cooperatives are ready to insist on and commit themselves to these issues and to become sources of regeneration and a new form of economic and civil humanism. We can reinvent our mission as an economic role in the development of local communities and move from being "resilient" firms to being firms that promote the common good. One of the most precious of common goods is work and cooperatives have proved that they are better able to protect it.

During this transformation of work, cooperatives represent a safety barrier protecting the principle of economic democracy. They are the "rescue" platforms for the real economy, in particular for all the services, production and craftsmanship sectors, and could offer a form of protection that enables the market economy to be saved from the intoxication of finance, which is creating a succession of crises.

This is why, as we have said above, we are convinced of the need for a "social and ecological industrial plan" for Europe and for work: putting cooperatives back on the European agenda is part of this plan that we at CECOP are keen to help build.