Globalization

Globalization and its effects on organizations and employees around the world

What is globalization and what are the effects of it on organizations and employees? The aim of this essay is, with the help of relevant sources, to clarify the term globalization and determine its impact on the work force and businesses.
Buchanan and Huczynski (2010) has defined globalization as “the intensification of world-wide social and business relationships which link localities in such a way that local condition are shaped by distant events”.
Globalization can be of different of different nature – for instance – political, environmental and economic( Di Pietro). In this essay, attention would be paid to the economic factor in order to review how economic globalization influences the employment.
Firstly, economic globalization might impact on the number of jobs that are available and therefore, affect the employment rate and the employment- to-population ratio. As globalization is differently influential on micro-economic level, i.e. establishment, enterprise, economic activity and macro-economic level – total economy, it is what has made this particular issue a more complex one. As an example, offshoring can be pointed. When an enterprise is closed in one country and moved to another, this may lead to job losses in a certain economic activity of the first country. In addition, it might result in more working places for the same country due to the higher productivity in the other established enterprises, higher wages and higher consumption demand. (Kazi, T., 2011, Di Pietro)
Another effect of the economic globalization may occur in the structure of jobs – their distribution across economic activities. Jobs which are connected to some economic activities have the tendency to vanish while jobs linked to other economic activities, are established as a means of changing competitive advantage. In this case, not only the economic globalization may cause the changes on job structure, but also technological progress could be a factor. (Kazi, T., 2011, Di Pietro)
In addition to the other two effects an economic globalization may have, another could be added. The composition of jobs, which is the mix of both skilled and unskilled jobs in the economy, may also be affected by the economic globalization. For instance, in developed countries low-skilled workers have been affected by stagnation in revenues and the increase in employment which is likely brought by completion amongst workers in developing countries and also influenced by technological progress. Nevertheless, the working force in these countries, becomes more qualified and engage in a more complex and sophisticated, service-oriented activities meanwhile skilled workers from developed countries recognize the competition of their counterparts from the developing countries. (Kazi, T., 2011, Di Pietro)
Furthermore, globalization also affects the employment condition in the economy. In addition to labour costs as a factor, employment conditions are part of the competition between economic locations. For instance, longer working hours, a ban on trade unions or lower safety requirements might be appealing to multinational enterprises and interfere with offshoring. This may lead to affect employment conditions in the source countries of offshoring in regard to working hours. (Di Pietro; Kazi, T., 2011)
Companies are quickly expanding in order to become the dominant on their native market and all the while the wages of the employees stay low and decrease, these employees are the reason for creating the profit used for expansion. This means that a priority is given to the profit over the workers’ wages. Consequently, a situation as described has developed: “It is one of the paradoxes of service-sector employment that the more prominent a role it plays in the labour landscape, the more the casual service-sector companies become in their attitude toward providing job security”. The service sector has different ideas and agendas in terms of a part-time or temporary work. They view it as an opportunity to avoid benefits and overtime, keep the wages low and evade commitment. In the same time, finding innovative ways to make the most of their part-time employees, reducing their working hours and at the same time maximizing their efficiency and productivity. What is more, by employing workers on temporary contracts, companies are bypassing the laws that provide benefits to workers and that prevent them from firing without cause. On the other hand, there are now agencies which provide companies which do not want to commit to full-time employees, the opportunity to staff entire functions and divisions with temporary workers, as well as carrying out the administration and management of the task, allowing companies to focus their time, energy and resources on the core business. (Kazi, T., 2011, Di Pietro)

When it comes to concerns in the human resources field, an amount of time abroad may be required for the managerial careers as a result of the growing globally outlook of organizations. Managers will most likely have to experience and gain cross-cultural qualities. Furthermore, for companies which operate globally, their managerial resource base also would have to be assessed in order to be determined if it can function properly on a global level.
An effect of the globalization on business may be the establishment of a truly international labour market. Organization would have to offer working conditions and compensation which would meet the standards or even exceed it elsewhere. (Kazi, T., 2011),
John Naisbitt, one of the most well-respected economic futurists, states that in a globalized economy the market niche becomes smaller which gives advantage to the flexible, specialty company. As a result, Naisbitt suggests that big companies become confederations of small, entrepreneurial companies to survive. Naisbitt also adds that “webs” of strategic alliances would make it possible for small and middle-sized companies produce anywhere meeting the quality standards and market requirements. (Robbins, Judge 2013; Hyczynski, Buchanan, 2007)
To conclude, what globalization has done is mostly put profit over people. As a result, it has become more difficult for many skilled or unskilled workers finding a job that fits them in terms of working hours and conditions.
References:
Hyczynski, A., Buchanan, D. (2007).Organizational behavior.(6th ed.). Essex: Pearson Education Limited Ltd.
Robbins, S., Judge, T. (2013). Organizational behavior(15th ed.). Essex Pearson Education Limited Ltd.
Kazi, T. (2011), Effects of Globalization on Work and Organizations: Exploring Post-Industrialism, Post-Fordism, Work and Management in the Global Era, 3 (12), 1-2 http://www.studentpulse.com/articles/601/effects-of-globalization-on-work-and-organizations-exploring-post-industrialism-post-fordism-work-and-management-in-the-global-era Assessed on 25.01.2013
Di Pietro, M., The Impact of Globalisation on Employment
http://epp.eurostat.ec.europa.eu/portal/page/portal/conferences/documents/93rd_dgins_conference/SESSION%20II%20DOC%204.PDF

References: Hyczynski, A., Buchanan, D. (2007).Organizational behavior.(6th ed.). Essex: Pearson Education Limited Ltd. Robbins, S., Judge, T. (2013). Organizational behavior(15th ed.). Essex Pearson Education Limited Ltd. Kazi, T. (2011), Effects of Globalization on Work and Organizations: Exploring Post-Industrialism, Post-Fordism, Work and Management in the Global Era, 3 (12), 1-2 http://www.studentpulse.com/articles/601/effects-of-globalization-on-work-and-organizations-exploring-post-industrialism-post-fordism-work-and-management-in-the-global-era Assessed on 25.01.2013 Di Pietro, M., The Impact of Globalisation on Employment http://epp.eurostat.ec.europa.eu/portal/page/portal/conferences/documents/93rd_dgins_conference/SESSION%20II%20DOC%204.PDF