Flexible labour markets and regional development in northern Greece

Flexible labour markets and regional development in northern Greece by Costis Hadjimichalis and Dina Vaiou

I Introduction

In this paper we examine some relations between forms of production organization, labour control and modes of social reproduction, with their particular geographies. As recent research has shown, these relations can play an important role in determining the form that uneven regional development has taken and its peculiarities in each capitalist country. We seek in particular to highlight the dialectical relationship between macrotendencies of capitalist restructuring at the international scale and the microfoundations of time- and place-specific characteristics that integrate global tendencies with the particularity of place. A useful concept for the approach of regional development from such a perspective is the local labour market. It permits the analysis to be sufficiently specific (and thus operational for political practice) without isolating local social events from their macro sociospatial contexts. We may say in brief that among the many factors influencing the recent emergence of new prosperous spaces and/ or the decline of others, the labour factor seems to be the most important and is becoming more so.

In the subsequent discussion we shall attempt to clarify and substantiate the above remarks, first with a brief theoretical comment and secondly with a more extended presentation of a case study in Macedonia-Thraki in northern Greece, which is part of the more general pattern of uneven regional development observable in southern Europe. Macedonia-Thraki is not proposed here as a ‘typical example’ of such developments but as one of the ways in which capitalist restructuring in southern Europe modifies the pattern of uneven regional development as it articulates, with concrete and often conflicting social practices and rational choices of capital, the state and local people.

I1 The significance of local labour markets in uneven regional development: macro- versus microexplanations

The last two decades have witnessed deep changes in the space economy of contemporary European capitalism. These changes include a relative decline in

2 Flexible labour marketslregional development in N . Greece

the economic and political importance of old industrial ‘heartlands’; an opening of new industrial spaces in environments as different as for example the south of the UK, the Grenoble-Toulouse axis, northeast central Italy, the north of Portugal and Greece; the changing role of many metropolitan areas via their increasing tertiarization; productive decentralization to rural areas as in Spain or reagglomeration of new high-tech industries as in the FRG; and a new function of rural areas incorporating intensive agriculture and mass tourism across the Mediterranean (Bagnasco, 1988; Scott, 1988; Hudson, 1988).

Such changes have set new terms for uneven regional development and a different research agenda. Many dissimilar processes, however, have been largely interpreted from a macroeconomic perspective, looking primarily at global processes and seeking to estimate their local effects. In most of marxist regional research the starting point was some form of general theory providing the framework for understanding the occurrence of events. In this analytical and theoretical approach, empirical patterns of change in the urban and regional system were certainly important but were often selectively analysed to support or illustrate the theory (Smith, 1987).

It is only in the last few years that there has been an active effort to incorporate micro explanation of social phenomena into a marxist theoretical framework (Levine et al. , 1987). In regional research this more general tendency is expressed by a new emphasis on the importance of place, on the premise that ‘geography matters’, as Massey (1984) argues. The analysis moves beyond simple explanations of regional differentiation via accumulation imperatives, to show how changing social and political relations (based on class, gender, ethnicity, etc.) are constituted and reconstituted in particular regions. The incorporation of microexplanations in the wider theoretical framework has often shown how what look like similar processes or phenomena may actually have quite different origins and implications in different regions and among social classes and, consequently, how the historical constitution of regions and social classes has contributed to determining the form taken by general processes or phenomena.

The retreat from grand theories and dominant archetypes does not, however, free regional analysis of all problems. It runs the risk, on the one hand, of relapsing into the empiricism of an earlier generation of geographical studies which examined individual localities for their own sake, devoid of a theoretical or historical framework (Fremont, 1976; Claval, 1977; Tuan, 1977); and on the other, of producing an almost infinite taxonomy of microrelations that prove of little help in the development of a more coherent understanding of contemporary sociospatial changes.

Thus it is necessary to examine the two approaches in an effort to define a dialectic relationship between macro- and microexplanations. In this context diversities between and within regions are not understood as direct outcomes of global processes of capitalist restructuring. Such processes are modified and reproduced as they are inscribed on particular productive structures, unique labour processes, class, gender and ethnic hierarchies, institutional and cultural

Costis Hadjimichalis and Dina Vaiou 3

practices, all of which define specific regions and localities but also form part of the explanation of uneven regional development.

A useful concept for the analysis of regional development from such a perspective is the local labour market, mediating between the specific and the general sociospatial context (Paci, 1978; Bleitrach and Chenu, 1979). The connection between labour market theories and regional development has been widely discussed in Italy since the 1960s (Magnaghi and Perelli, 1978; Paci, 1982; Garofoli, 1974; Bagnasco, 1977; 1988; Arcangeli et al., 1980; Mingione, 1985; Znchiesta, 1986). It has also attracted major interest from English-speaking scholars (Friedman, 1977; Urry, 1981; Cooke, 1983; Massey, 1984). Regions and local areas are viewed in this sense as geographical entities where the development process produces, and is in turn stimulated to reproduce, spatially diverse divisions of labour. Well-paid, secure, prestigious jobs with substantial qualification requirements concentrate in some areas, while other areas display the inverse of these features (Cooke, 1983). Such differences can be uderstood by looking into the workings of local labour markets and into the cunditions and relationships under which the exchange of labour power occurs in pa:ticular places.

Local labour markets are time- and place-specific and permit us to integrate into an analysis such issues as the local productive basis and capital ownernhip patterns, the geographical distribution of jobs, particular forms of work. availability and cost of labour, segmentation and collective organization of ti,? labour force, institutional specificities and forms of social reproduction. These issues, which we discuss in more detail below, have national or even global dimensions and implications which are derived in part from wider restructuring processes in particular sectors or branches of production. In addition the geographical specificity of local labour markets introduces a multiplicity of relationships that are difficult to understand through functional models of labour market segmentation (Berger and Piore, 1973; Edwards et al., 1975). Spatial differentiation brings labour to the forefront at a time when the tendency towards ever greater flexibility requires a variety of labour markets to fit different, fractional operations of capital.

The local productive basis and capital ownership patterns in an area reflect its succession of roles in changing spatial divisions of labour (Massey, 1984). They also form part of global restructuring processes in particular sectors of production. The types and local differentiation of productive activities, the sectoral composition of employment, the types of firms (in terms of ownership, size, technology used, product markets, skill requirements, means of labour control) generate quite specific demands for labour. Such differentiated demand is critical for the location of firms (Storper and Walker, 1983). The geographical distribution ofjobs (along with the organization of particular firms) outlines areas of recruitment and the boundaries of daily commuting as part of the definition of local labour markets. Znstitutional specificities introduced by the state and local authorities, such as regional incentives to capital or regulation of labour relations,


influence industrial location decisions and thus geographically differentiated demand for labour.

The latter is met or recast over time through concrete and geographically diverse social structures where labour is reproduced. Conditions of reproduction vary considerably, following the practices of a number of institutions (family, local community, state). In the contradictory process of labour exchange, ‘labour supply’ is not a fixed set of characteristics to be inserted in specified jobs; it is rather an ensemble of qualities that individuals bring into the work relation. These are acquired not only through the experience of work but also through socialization into dominant values, and cultural, gender or ethnic identities (see Elson and Pearson, 1981). The overall size of a local labour market is conditioned by national or local practices of inclusion in or exclusion from it. These vary over time and are not necessarily or primarily determined by workplace requirements. Institutional restrictions on minimum age or retirement age modify the age groups included in the labour market. Gender or ethnic discrimination practices allocate individuals to particular places in the labour market or at times exclude them altogether (see for example Philips and Taylor, 1980; Alexander, 1980). Such practices, along with local or sectoral traditions of labour militancy, help define a hierarchy of acceptable levels of compensation.

Particular forms of work, such as security and regularity of employment contracts, prospects of advancement, safety and health restrictions in the workplace, outworking and forms of subcontracting production as well as patterns of multiple employment, part-time and seasonal work are an outcome both of global sectoral practices and of local syntheses of conditions that make them possible or acceptable. Such ‘conditions of purchase’ of labour segment local labour markets into different groups of workers and jobs. The age, gender or ethnicity of individual workers forms an equally important basis for divisions based on nonworkplace determinants (Wallerstein, 1983).

From such a perspective it is not possible to consider the working class as a homogeneous body or an abstract idea. It has rather to be studied as a changing set of relations in which men and women, core and peripheral workers, immigrant labourers and casual workers in the informal sector may all be exploited by capital but at the same time experience antagonistic relations among themselves (Urry, 1981; Mingione, 1983; Vaiou, 1986). Forms of labour organization and struggle are not, therefore, pregiven or constant over time, nor can they be identical across national boundaries. Different local labour markets aid the formation of, and are distinguished by, different kinds of class. Different forms of local solidarity and resistance may then develop based on the interaction between production relations and local social structure in which individuals become conscious of a shared experience.

The preceding discussion was an attempt to clarify the ways in which local labour markets may prove a useful concept to understand uneven regional development as the outcome and the basis both of general processes of capitalist restructuring and of specific localized social structures. In the next sections of this


paper we explore the recent development of Macedonia-Thraki in northern Greece through the workings of local labour markets, following a brief discussion of alternative analyses of uneven regional development in Greece.

111 Uneven development in post-1970 Greece: a debate

For southern European countries the 1950s and 1960s were generally marked by high rates of national economic growth and by ‘economic miracles’ following the long postwar boom. During this period Greece (together with Spain and Italy and to a lesser degree Portugal) had one of the highest annual growth rates in GDP in western Europe, a 6.8Yo annual average. The capitalist world crisis of the 1970s not only modified the external context but coincided in the southern European Countries with unparalleled political changes which deeply modified the social and institutional parameters of the previous economic boom. At the beginning of the 1980s the old high growth rates seem to have gone for good, restricting the possibilities for economic expansion and state intervention. Since the mid-1980s the economic crisis in Greece has intensified. With a 10.2% officially recorded unemployment rate (real figures are greater), close to zero annual GDP growth, 14% inflation, a negative rate of private investment, a huge negative trade balance of US$3.275 million in 1985, and an external public debt reaching US$11.7 million in 1985 - to mention only a few macroeconomic indicators - Greek capitalism entered its first major postwar crisis. As has happened in other European countries, Greece is experiencing a deep restructuring not only in economic terms but in all spheres of everyday life (Hadjimichalis, 1986).

The discussion on the current crisis in Greece avoids to a large extent and for good reasons the fordistlneofordist argument (Boyer, 1986). While many sectors and firms in industry and services use taylorized principles, we can hardly argue that the present crisis of capitalism in Greece is characterized by the crisis of fordism. There are major effects caused by this crisis in other countries and regions, especially those of the EEC. But the problem is still the creation or establishment of the wage relation: in 1984, Greece had only 45% of its active population receiving wages, while 28.2% were classified as self-employed (NSS, 1984). These issues are addressed in some detail by those who focus on changes in social structures and forms of employment and, especially, on the Greek peculiarity of low percentages of economically active population and wage employment (Tsoukalas, 1986; Leontidou, 1986; Tsoulouvis, 1977).

The main discussion, however, on capitalist restructuring and regional development in Greece follows different paths, which can be broadly classified in the following four approaches. First, there is a widespread political reasoning, coming from the right, that the present political climate is a negative one for private investments and that the ‘statist’ policies of PASOK (the Greek Socialist Government) restrict private initiatives. According to these views, the Greek

6 Flexible labour marketslregional development in N. Greece

state intervenes too much in the economy and what is needed is reprivatization to permit the necessary restructuring via modernization, new technologies and adjustment to international competition (Andrianopoulos, 1987; Marinos, 1985). Regional policy proposals include a demand for more capital incentives and flexibility in labour relations in peripheral areas, which somehow contradict the stress on less state intervention (AGI, 1986).

The second approach supports the opposite view and is promoted by government officials who advocate their ‘stabilization’ programme as the only way out of the present crisis. They interpret the inadequate adjustment of Greek capitalism to the changing international division of labour, as an effect of the ‘bad policies of the past rightist rule’ (Pepelassis, 1986). Following this hypothesis, their proposed ‘good’ regional policies focus on decentralization of industry via capital incentives and tax exemptions, and by the location of large, state-owned plants in peripheral regions. But after more than seven years in office with only minor achievements their arguments have become rather discredited. The stabilization programme launched by PASOK has in reality been an austerity programme, freezing salaries and pensions for two years and reducing the disposable income of wage earners by 12.5%. But freezing the cost of labour has not led to the government’s double restructuring goal: to restrict consumption and imports and at the same time to increase private capital investment. Consumption increased by 1.8% and imports by 12.2% in 1986-87, while investments were further reduced by 5% (Bank of Greece, 1987). It has become evident therefore that these policies cannot affect the majority of incomes and are not sufficient to improve the weak industrial structure.

These observations reinforce the arguments of the third approach which places its main emphasis on the negative role of the ‘parallel economy’ or the informal sector and the limited adoption of new technologies (Papayannakis, 1986; Marinos, 1985; OECD, 1986). The general argument here is that the present crisis has not led to technological improvements and increases in productivity but to flourishing unrecorded informal activities which provide cheap goods and services exploiting cheap labour and the inability andlor unwillingness of the state to impose direct taxation. A recent estimate is that recorded economic activities are 30% less than actual performance, with 71% of construction being unregulated (Pavlopoulos, 1987).

A more elaborate analysis is provided by those who advocate the deindustrial- ization thesis (Vaitsos, 1982; Yannitsis, 1985; Vergopoulos, 1986). Their criticism of postwar capitalist development in Greece is based on the lack of any significant modernization of ‘national’ productive structures. Prosperity (until the end of the 1970s) and consumerism in Greece, they argue, was somehow ‘imported’, dependent on three external factors: migrants remittances, tourist foreign currency inflows and commercial navigation receipts. With the crisis of fordism in western European countries, Greece lost both its markets for certain industrial exports and the inflow of foreign currency. This had immediate effects on its industrial structure, which showed clear backward restructuring trends. From a


specialization in leading sectors of steel, chemical products, shipbuilding and transportation in the 1960s, the present industrial structure is dominated by nonmetallic minerals, textiles and clothing, food, wine and tobacco processing, a structure similar to prewar developments. These industries run along taylorist principles using low-paid, mainly female workers. Using a similar sectoral approach but focusing also on the regional distribution of industrial investments and the role of incentives in relation to capital movements, Katochianou et al. (1984), Kafkalas (1984) and Andricopoulou (1984) provide useful information on regional changes in industrial structures and on how these changes have been affected by state intervention.

From this very brief and incomplete presentation of the various accounts of capitalist restructuring in Greece, differences with old industrial European regions are evident. Despite their many and marked differences, these approaches share a common and almost exclusive emphasis on the nation state as the basic unit of analysis and on capital as the main determinant of developments within it. Thus, on the one hand, the role of people as rational agents affecting changes within the limits that capital and the state impose is neglected. The concern about how restructuring affects local people is somehow ignored, as well as the complex relationship between working and living in particular places at particular times. On the other hand, only cursory attention is paid to differentiation and particularly to how restructuring is promoted by capital and experienced by people in different places. There are many descriptive references to these variations but little concern with how differences condition place-specific developments and are reproduced and maintained. For example, while they acknowledge that a form of industrial restructuring does take place, its interconnections with developments in other sectors are not evaluated, nor is their geographical differentiation. Regional uneveness, when discussed, is viewed as the sole outcome of industrial changes.

In those approaches which share a marxist perspective a differentiated view of capital as many competitive capitals is accepted. But they tend to cling to a utopian view of a unified working class across different sectors, firms and regions. However, class interests, organization and practices in Greece (as in other capitalist countries) are formulated at least in part with respect to particular localities. This is especially so at a time when capital strategies increasingly incorporate and deepen geographical and social uneveness, thereby fragmenting opposition and playing off workers in different places. For example, while many of the approaches briefly outlined above refer to cheap female labour as a prime factor in the restructuring process in Greece, they ignore discussion of why women or other subordinate groups in certain areas accept these low wages and how this is reproduced through relationships which cannot be analysed in terms of capital-labour conflicts at the workplace, or at an exclusively national level.

Costis Hadiimichalis and Dina Vaiou 9

IV Local labour markets in Macedonia and Thraki’

The regional pattern that coincided with the deep crisis outlined in the previous section (and in many ways determined its reproduction) has been characterized by a growing differentiation between I) urban centres of older industrialization (like Greater Athens, Thessaloniki, Patras) which have begun to show signs of economic decline; 2 ) marginalized rural areas (mainly in the mountainous part of the mainland and on remote islands) which have continued to lose both population and economic activities; and 3) a new dynamic group of what we have called ‘intermediate regions’ (Hadjimichalis and Vaiou, 1985; 1987).

We identified as intermediate regions those areas which have shown firm repopulation tendencies since the mid-1970s and rates of growth higher than or very close to the national average. In these regions, which are easily accessible from older ‘core’ areas, small and medium-size industrial firms, tourist facilities and intensive agriculture holdings were able to realize higher profits than national sectoral averages (ICAP, 1987). Many parts of Macedonia and Thraki actively participated in this new development pattern, contradicting prevalent views about their underdevelopment and stagnation. This new dynamic performance is not always recorded in official statistics since many activities rely on the informal sector.

In Macedonia and Thraki revivified artisanal and craft industries producing largely for final consumption, food industries and exporting agricultural firms and services to local industries and tourist resorts have all been able to modify production processes with great rapidity and efficiency during the last 10 years. Taking advantage of factors like the positive geopolitical climate, proximity to European markets, rich natural resources, strong state intervention in terms of tax incentives and infrastructure construction and well-situated and long-standing networks and external linkages, local firms in industry and agriculture were able to increase their share in the home market and realize a considerable volume of exports.

Until the mid-l980s, however, the most critical local feature that underlay the dynamic performance of firms operating in the region was the organization of local labour markets. Their great internal variation and fragmentation increased the flexibility of local firms, allowing them to adopt highly flexible employment strategies. In Macedonia and Thraki - perhaps more than in any other Greek region - it is possible to find a wide range of combinations of formal and informal activities, multiple employment patterns in industry, agriculture and tourism and a highly fragmented labour force along gender and ethnic lines.

In what follows we will discuss why Macedonia and Thraki (or parts of it) came

In this section we use our survey notes from various field trips in the region and extensive interviews with managers, workers and union leaders. We draw heavily on two surveys of 63 industrial firms in west central Macedonia and 52 in east Macedonia and Thraki. These two surveys were conducted for METEK S.A. in 1985 and 1986 and were designed to be representative of existing branches, size and location of firms.


to occupy this position in the spatial division of labour in Greece, by analysing local labour markets.* Our aim here is not simply to repeat the obvious: that abundant, cheap and docile labour has been one of the major incentives for capital investment in northern Greece. We will rather try to examine the processes through which specific sections of the labour force are mobilized or frozen at certain cost and quality levels at particular times and places. We will therefore be looking at the availability of labour in northern Greece, the types of jobs and the sectors and branches in which employment is offered, the cost at which labour is made available to capital and the particular ‘qualities’ of labour, all of which account for the flexibility that restructuring has built upon and reproduced.

1 Overall size

A figure indicative of the actual size of the labour market is the percentage of the ‘active population’. In the case of northern Greece the share of the ‘active’ population is higher than (or close to) the national average, though the figure declined between 1961 and 1981 as employment in agriculture fell. Women form a significant part of the active population: 31.2% in east Macedonia and Thraki, 34.2% in west central Macedonia (national average 25.8% in 1983). Their participation in manufacturing employment rapidly increased after 1970, reaching, in east Macedonia and Thraki, the highest percentage in the country in 1983.

Active population, however, refers only to those who are actually in the labour market, in paid employment or looking for jobs. A figure that is perhaps more interesting is the total number of people in the 15-65 age groups (minimum age for work and retirement age) indicating the potential size of the regional labour market. For northern Greece it is worth noting the high proportion of these age groups in the total population (close to or higher than the national average), as well as the high proportion of people potentially entering the labour market (aged 15-19) in relation to those close to retirement age (aged 60-64). This kind of demographic dynamism is particularly pronounced among ethnic minorities in Thraki. It remains close to the national average in west and central Macedonia, slightly exceeding it in Kastoria and Pella.

The high proportion of the active population and of people in the 15-65 age groups must, at least in part, to be attributed to changed patterns of migration. In the 1960s the population declined substantially (e.g., -18.4% in east Macedonia), mainly due to the scale of net migration (-28.0% in east Macedonia and -18.8% in Thraki). The repopulation of the next decade (1971-81) was primarily the outcome of a massive reduction of outmigration and a significant flow of return migration, with net migration dropping to -3.4o/b in east Macedonia and to -2.4% in Thraki. Returning migrants settled, with few exceptions, in their

For the names mentioned in the text, see Map 1. For the geographical specificity of local labour markets, see Map 2.


areas of origin where they usually owned land and/or other property. They tended to work in industry periodically or in positions inferior to those they held abroad. Only 3.3% of them in west central Macedonia and 8.5% in east Macedonia and Thraki started their own businesses, while 40.6% and 46.8% respectively worked as unskilled workers. Forty percent of workers in industry had worked abroad, mainly in West Germany for some length of time.

The share of such pools of labour that is included in or excluded from the labour market is neither pregiven nor constant. At different times and places population groups have been drawn into paid employment that were not previously considered formally available for it. Women are a prime example. They have been drawn into paid employment at times of labour shortages (in wartime, but also in periods of massive male outmigration) and thrown back into the home when circumstances changed. Such shifts required changes of attitudes and, often, legislation regarding whether they could ‘go out to work’ at all and to what kinds of jobs, thus legitimizing their exclusion.

In northern Greece recent restructuring has drawn upon a pool of labour that was not mobilized in previous spatial divisions of labour. The firms that located in Thraki after 1974, for example, primarily used unskilled labour. In Thraki there was an oversupply of such labour, underemployed in agriculture. The region presented the highest percentage of women working in industry. It is no coincidence that the firms mentioned used labour-intensive production processes, particularly in those branches of production where, traditionally, the labour force was mainly female and unskilled or semi-skilled: e.g., clothing, assembly of electrical equipment, food processing and textiles.

2 The sectoral composition and the local differentiation of labour

Official labour statistics divide employment into the well-known triple classification of primary, secondary and tertiary sectors while a dominant assumption of development theories has been to use the gradual elimination of primary employment as an index of development and prosperity. Agriculture has been seen as a backward sector, while industrialization has been synonymous with dynamism and growth. These arguments were in good currency until it was realized -- particularly in southern Europe - that multiple employment in different sectors and the very loose definition of a ‘peasant’ made sectoral descriptions highly problematic.

Nonetheless, the relative importance of the rural sector in northern Greece is undeniable, but this ‘sector’ does not now include traditional primary activities, as defined in official statistics. For example, in 1981 Kastoria had a national record level of employment in the secondary sector with 53% of its total active population, while at the same time more than half of its highly specialized workforce in fur processing also worked in agriculture. The same is true in Xanthi, an area with a great increase in industrial employment. Here 40-60% of those classified as industrial workers (depending on branch) also worked at least

12 Flexible labour markelslregional development in N . Greece

120 days per year in agriculture, so that they could earn additional agricultural subsidies from the Greek state and the EEC. This combination had some advantages for both capital and labour. The former used low-paid seasonal labour with no pay obligations for the rest of the time, while the latter made a living by taking more than one job during the year and from subsidies.

Similar problems can be identified when we analyse production and employment within each sector. Looking first at agriculture, we see an important heterogeneity, including capitalist and peasant farms, backward and dynamic units and small and large estates, so that different types of agricultural work are present (Mottura and Pugliese, 1975; Camilleri et al., 1977; Hadjimichalis, 1986). However, the traditional, subsistence, small family unit, which was used to describe Mediterranean agriculture, while still dominant in the high and mountainous areas, is no longer typical of agriculture in the region. Since the 1970s, many dynamic small and medium-size farms have come into existence specializing in short-term crops (usually grown in greenhouses) fruit, vegetables and flowers for export. With expanding EEC markets these units are growing fast in the well-watered areas of Imathia, Pella, Serres. Rodopi and Evros.

These developments challenged another stereotype - the use of mainly family labour in agricultural activities. Again, this is still true for subsistence/traditional peasant farms, which are very small in size (below five hectares) and are widespread in the less accessible, nonirrigated zones. But many of the modernized farms, while they remain family operations, have started in the last decade to use sporadic, marginal or seasonal daily-wage labour. The case of Imathia is perhaps extreme but illustrative of the situation. During the last eight years an increasing number of Poles work there during the summer, collecting fruit (mainly peaches) for export. They initially came as tourists and lived in tents on the farms. They worked for 1-2 months earning lower daily wages than Greek workers, without insurance and other benefits. During 1986 they numbered between 5000 and 6000 in Imathia alone.

The case of industrial employment is even more complicated. In 1984, in west central Macedonia (excluding Thessaloniki) 82.3% of total industrial employment and 80.7% of invested capital was concentrated in the food industries, textiles and clothing. In east Macedonia and Thraki these three branches accounted for 72.5% of employment and 69.3% of invested capital. There were a few ‘basic’ industries in Kavala (chemical plant, oil refineries, North Aegean oil) and Kozani (chemical plant, electric power stations) while other branches such as plastics, metallic products, nonmetallic minerals and furniture were unevenly distributed in Imathia, Pella, Halkidiki, Kilkis, Kavala and Xanthi. A basic orientation, therefore, has been towards consumer goods, while in the dominant sectors the size of firms is greater than the national average and capital intensity is close to national figures for these industries (Hadjantonis et al., 1987).

There are several distinctions, however, among branches, and within each branch, in terms of managerial and recruitment practices and production organization. We can identify first those large firms (more than 200 employees)


which use taylorized practices, rewarding ‘responsible’ workers. These firms are a minority in the region but they dominate it in relation to the employment and security that they provide for workers. These firms can be subdivided into those controlled by local capital (mainly in food and textiles) and those controlled by nonlocal capital (Greek, foreign, public companies, co-ops). The few ‘basic’ industries are in this category as well as many food and tobacco processing firms. A second major category is modernized MSEs (mediudsmall enterprises), which can also be subdivided on the basis of local and nonlocal capital ownership. Firms controlled by local capital tend to specialize in exporting food, clothing and several other products, while those controlled by nonlocal capital specialize in clothing, metallic products, nonmetallic minerals and other areas. Thirdly, there are those traditional MSEs, which follow certain craft traditions, are almost totally controlled by local capital and specialize in various products for local consumption. Finally, there is a large but not easily quantifiable category of diffused industrialization based on family units for which data and research is still limited.

The specialization in food, textiles and clothing permits industries to use a seasonal and ‘marginal’ labour force (food industries), feminized (in all three branches) and extensive outworking (clothing). This contrasts with the other less dominant industries like chemicals, plastic, metallic products and nonmetallic minerals, where employment is more stable and recruitment focuses on male, ‘skilled’ labour. As we analyse below, however, the definition of seasonal, marginal feminized, skilled or stable is strongly dependent on the local class structure and gender and ethnic composition. For example, the initial locational choice of the Kavala chemical plant was Halkis in Euboea, but it changed to Kavala because of local labour market characteristics. Kavala at that time provided a fair number of skilled, male, unionized but disciplined ex-tobacco workers. For the first 200 jobs the company received 3500 applications. Outworking for clothing in villages around Serres town is strongly related to a local tradition for flocati carpet production, which was organized in small family workshops. This tradition ‘trained’ local women, who are now sewing uniforms for the armies of Holland and Belgium at home. In Chrissoupolis, near Kavala and in Xanthi, ex-tobacco women workers with ‘trained hands’ are assembling Christmas and carnival decorations at home for the national market and for export to the EEC. The supplier of materials and the collector of their piece work is using a Japanese patent. And finally in Kozani accumulated capital from land compensation paid by the power company permitted at least 50 company engineers to buy small, modern mills and grind flour in their backyards. They work on rather stable subcontracts from a large local mill which is now operating only as a warehouse.

These and other nonofficially regulated industrial activities make the classical branch analysis highly vulnerable. Clothing and food industries in Thraki use different management tactics from those in Imathia or in Athens. The existing polarization of working conditions between certain privileged large firms and the


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large numbers of SMEs, on the one hand, and between stable employment and irregular outworking, on the other, underlines the importance of the spatial component in structuring labour markets.

Local specialization, the sectoral composition of employment, the type of firms operating locally, the poor accessibility of some areas, attitudes about acceptable home-workplace distances, ethnic and gender divisions and local labour history help define many more or less geographically distinct local labour markets. In some cases the radius of daily commuting exceeds town and even district boundaries reaching up to 30 km. In other cases considerable concentrations of workers live short distances around their workplace (e.g., workers in the power stations of Kozani, fur workers in Kastoria and Siatista). The same is true for the ‘reverse’ movement, i.e., for cases of the subcontracting of parts of the production process to homeworkers. The geographical boundaries of recruitment and commuting thus affect the size of local labour markets (see Map 2).

3 Cost of labour

An important consideration for most firms that located in northern Greece after 1974 was the low cost of labour, mentioned in almost all interviews and reports and sustained - if not promoted - in a number of ways. In what follows we will discuss divisions among ‘core’, ‘peripheral’ and ‘marginal’ workers (following the categorization of Friedman, 1977); the workings of gender and ethnicity and conditions of reproduction - all of which condition the local determinants of the cost of labour.

Divisions among different groups of workers based on the terms of their job contracts contribute to keeping wages low for most groups, while maintaining relatively high standards for some others. ‘Core workers’ have relatively stable contracts; they are usually defined as ‘skilled’ and earn higher salaries with social security and other fringe benefits included in their contracts. They work in some of the bigger firms and are strongly unionized. Examples include workers in the phosphoric fertilizers plant in Kavalla, in the power stations and fertilizer firm in Kozani and in the paper mill of Xanthi.

Divisions between core and peripheral workers can be found both among firms and within the same firm. The sugar factor in Imathia employs a stable workforce (‘core workers’) all year round and hires seasonal labour for peak periods. In the small firms, which form the majority of employers in northern Greece, ‘peripheral’ workers hold unstable job contracts or no official contracts at all. They are usually defined as ‘semi-skilled’, they are underpaid and poorly unionized, as for eample at ‘Plastika’ in Kavala. Recent legislation on labour relations attempts to legitimize this situation by giving firms the right to lengthen the working day in peak periods and shorten it when production slows down.

There are substantial seasonal variations in the demand for labour in agriculture and in industry (food and beverages, clothing, leather and fur, tobacco). In west central Macedonia, for example, only one-third of the firms


work the year round. In addition, much of the production process is subcontracted, either to small family units or to individual homeworkers, mostly women, who enjoy no rights as workers and income earners. Thus, part of the labour force is ‘hidden’ andlor continuously oscillates between part-time or occasional jobs and unemployment. Most ‘marginal workers’ are hired and laid off according to production needs, with no contracts or security. In east Macedonia and Thraki the abundance of surplus labour makes their position in the labour market even worse.

Conditions of collective bargaining and the nature of job contracts, however, are not the only basis of fragmentation of labour markets. Features not necessarily derived from the capital labour relation, such as gender and ethnicity, continuously reproduce divisions among workers.

It has already been mentioned that women in northern Greece form an important part of the workforce. What is worth noting though, is that they have not been drawn into male-dominated occupations (see Campbell, 1982). They have been drawn into expanding female-dominated ococupations: in textiles and clothing, in food and beverages, in assembly and packing where most jobs are defined as ‘women’s work’, and by this token less skilled and less remunerative.

In industry, women earned 1800-2000 drs daily (1984) while men earned 2200- 2500 drs. In agriculture the respective daily wages were 700-1000 drs and 1000- 1200 drs. Only bigger firms, controlled by the state, paid fringe benefits and insurance. Almost no women had ‘core worker’ status. The majority of them worked informally, without contracts, especially in small firms (up to 70% of women in east Macedonia and Thraki). The majority of homeworkers were women combining piece work at home with agriculture and domestic tasks, while 97% of those working seasonally in the food and beverage firms of west central Macedonia were also women.

In nonwage work (farming, domestic tasks, employment in family business) women worked as unpaid labour. They were 76% of ‘assisting and unpaid family members’ in family firms and in agriculture. In such cases opportunities to undertake paid employment outside the confines of the household were very restricted.

Sexual divisions of labour are not of course something new or recent. Men have often done different work from women (and adults from children and the elderly). But in the course of capitalist development such sexual divisions have become increasingly correlated with the valuation of work. Women’s work is devalued and a corresponding emphasis is placed on the value of the adult male’s (‘real’) work. Sexual divisions, although not constructed intrinsically in terms of gender, have thus become bearers of gender, contributing to women’s subordination (Elson and Pearson, 1981).

Along with gender divisions, employment patterns tend to allocate ethnic and religious groups to specific positions in the labour market, with different levels of pay for their work. Ethnicization of the workforce in northern Greece, particularly in east Macedonia and Thraki, has provided a built-in training


mechanism, conditioning expectations and limiting them. Some examples illustrate this.

Pomacks from the mountainous areas of Thraki are hired as cheap seasonal labour for the grape harvest in Orfanes, a prosperous village recently repopulated by returning migrants from West Germany. Gypsies and pomacks harvest fruit in Pella-Imathia, with very low daily wages. Women from the Turkish communities of Thraki form, along with Greek women, a long list from which ‘Mainitaria Thrakis’ (a firm producing mushrooms) announces each week who is to be hired. Men from the Turkish communities are hired for dirty and dangerous work in marble mining in Thassos island and in deep mining in Halkidiki.

The ways in which ethnic and religious minorities are incorporated in labour markets - by keeping the boundaries of such groups firmly defined - have contributed to providing sufficient workers with appropriate income expectations (Wallertein, 1983). Ethnic and gender distinctions serve to marginalize parts of the workforce while others (‘core workers’) retain privileged positions. Along with unemployment and underemployment they have helped to create a pool of labour ready to undertake employment under unfavourable conditions.

But gender and ethnicity are not the only determinants of the pay levels at which workers accept employment. The more the household in which a worker is located depends on wage income, the higher the minimum level of wage that helshe can afford to accept, since it has to cover costs of survival and reproduction of often numerous members of the household. When other forms of real income are produced - for example, production for self-consumption, services through domestic labour - surpluses are created which lower the threshold of the minimum acceptable wage.

In northern Greece the share of wage employment in total employment was around 29% (national level 48%) in 1981 and multiple employment was very widespread, as we have already noted. This share becomes even lower when we include not only the so-called ‘active population’ but all persons whose work is or could be incorporated in the productive process. This acquires increased importance in northern Greece where significant structural changes have taken place over the last two decades. Research conducted by the Agricultural Bank (1981-84) shows that 63% of farmers in east Macedonia and Thraki earnt income from additional sources (wage employment on limited time contracts, pensions, rents, subsidies, etc.). Forty to sixty percent of those who worked in industry also worked in agriculture and around 10% worked part-time in tourism.

This generalized pattern of labour mobility among sectors and through time and space reduces the dependence of individual workers and/or households on any one source of income. It reduces the minimm acceptable wage, thus further lowering labour costs for individual firms. In clothing firms, as all surveys document, part-time, low-paid work (mainly on piece rates) among women is very widespread. It is undertaken until total income reaches the tax-exempt maximum set by law. Other members of the household work as well and there is additional income from agriculture. Thus, part-time work in industry seems to


‘suit’ workers and employers, as is argued by a number of studies (Andricopoulou et al . , 1985: Papayannakis et a l . , 1986). However, low pay, limited legal coverage of labour contracts, lack of social security or fringe benefits actually ‘suit’ only employers. For workers, especially women, they reproduce a secondary status in the labour market and conditions of subordination in and out of paid employment.

The combination of such diverse labour processes and work relations is accomodated within the household, to which the reproduction of labour is also relegated. In this context, the unpaid labour of women has, to a great extent, to compensate for the inadequacy of state-provided services and their resulting domestication. The extent, quality and spatial distribution of public services and facilities not only regulates the reproduction of labour but also regulates the conditions under which individual recipients of services may have access to the labour market (Vaiou, 1986). By shifting the balance between what is publicly provided and what has to be met individually in the household, the state contributes to the reproduction of power relations among household members. It is not only ‘adequate workers’ that are thus reproduced, but also gendered (and ‘ethnicized’) individuals.

4 ‘Quality’ of labour

The variety of productive traditions in different parts of northern Greece has contributed to the formation of highly differentiated labour markets in terms of geographical boundaries, available skills, training of the workforce and methods of organization. Some skills are still useful in present production processes, for example in fur processing in Kastoria or in plough manufacturing in Nea Moudania, near Thessaloniki. In other cases traditional work discipline is an asset for new rounds of production, as in the case of recent industrial investments in Arnea and Halkidiki. In still other cases the lack of an industrial tradition has attracted new firms employing unskilled labour.

The definition of jobs as ‘skilled’, ‘unskilled’ or ‘semi-skilled’ differs over time and is a matter of struggle rather than of the nature of the job itself (see also Phillips and Taylor, 1980). Selecting and sewing together small pieces of fur is a job that requires visual and manual dexterity of a high order. It has been traditionally classified as ‘skilled’ work. But it started to be downgraded to ‘semi- skilled’ status when it began to be subcontracted to women home workers, with significant effects on pay rates.

Food industries in Pella-Imathia recruit seasonal ‘low-skill’ workers. The definition of skill in this case is based on a tautology: seasonal work is low-skill because it is seasonal. As we mentioned earlier almost all seasonal workers (97%) are women who, like ethnic and religious minorities, enter the labour market already classified as inferior labour.

Selecting and packing fruits in Imathia or sewing T-shirts in Serres requires no less skill than driving in the surface mines of Kozani. Their classification as

Costis Had j i~ icha~ i s and Dina Vaiou 19

‘unskilled’ and ‘semi-skilled’ has more to do with their being identified as ‘women’s work’ and ‘men’s work’ respectively than with the technical characteristics of the job (see for example Alexander, 1980). Thirty to forty percent of industrial workers in northern Greece (mainly women) go through a short period of learning on the job. Women are already ‘trained’ in the required skills and discipline through their socialization. Such ‘training’ - accurate eyes and nimble fingers - is not socially recognized as a skill and does not earn women workers a ‘skilled’ status, even though it is indispensable for a wide range of jobs (see Elson and Parson, 1981).

Divisions based on skill and training are further exacerbated by the training scheme policies of the Manpower Employment Organization (OAED). Their orientation towards young males is obvious. The training schemes bear no relevance to the skills required by firms -which is a problem in itself. They train people in traditional ‘men’s jobs’ (building trades, car repair, etc.). As positive measures to encourage young women to enter those trades are lacking, training schemes contribute to a greater segregation of the sexes in the labour market. In east Macedonia and Thraki no girls participate in training schemes.

Poor training, low-skill, multiple employment and seasonal work are often used to explain the ‘docility’ of the workforce in northern Greece and the highly differentiated patterns of unionization. The highest percentage of unionization is observed in the older and bigger firms; 80-85% unionization in firms established before 1970, vs 60-75% in those established after 1978; 92% unionization in big firms, 59% in small ones, with the core workers in the power plants of Kozani playing a leading role. In branches and firms using seasonal labour high percentages of nonunionized workers can be found (e.g., 42.5% in food ad beverage companies). An interesting exception is the clothing industry with 82% of the workforce unionized. It has to be noted, however, that these figures cover factory workers and not the increasing numbers of home workers or workers without contracts.

While these observations are quite illuminating they are an insufficient explanation of differences in militancy and collective organization. A deeper insight can be gained if we look into the features of individuals in seasonal jobs, having more than one job or low skills. The gender, age, ethnicity and place of residence of workers establish hierarchies in labour markets, link people to specific positions and condition their expectations and demands. The bargaining position of those low in the hierarchy (the ‘unskilled’, the ‘seasonal’, the ‘part- timers’) remains poor so long as differentials continue to be a means of defence of those high in the hierarchy and no collective practices that would bridge the gap are sought by organized labour.

V

In our analysis we have focused on the flexibility of local labour markets in northern Greece which has been crucial for the regional dynamism observed in

Beyond theoretical obstacles and political marginalization?


the last decade. This flexibility, we have argued, derives from the variety of productive and cultural traditions of the region which are integrated and reproduced in the process of restructuring. The example of Poles who come to work in the peach harvest in Pella and Imathia is perhaps extreme but illustrative. people from a (supposedly developed) socialist country travel to a (supposedly peripheral) capitalist southern European region to work as part-time agricultural labourers for the lowest possible pay: They thus contribute to excess profits of local, small, usually family-run businesses. The latter, subsequently, dump half or more of the peaches and further increase their profits from the high ‘withdrawal’ prices that the EEC pays to producers of such crops. So the price of peaches in European markets is kept high, making them inaccessible to large numbers of people.

Seen from a macroperspective, such processes and relationships can be explained as typical examples of the irrationality of the world capitalist system that is able to integrate supposedly distinct social environments under the single profits rule.

This, however, is only part of an answer in that it does not touch upon how restructuring affects working and living conditions in particular places, nor how these can be changed by the social practices of those involved. Looking at the workings of local labour markets, in our view, permits a better understanding of such place-specific manifestations of global processes. Moreover, it allows us to include in the analysis relations which usually lie outside the concern of regional development analyses but have proved to be an important feature of the restructuring and reproduction of capitalist social relations.

These observations highlight two theoretical problems which this paper attempts to elaborate. On the one hand, there is the difficulty of developing a theoretical framework which allows explanatory links to be made between macrorestructuring trends and the microfoundations of social phenomena at the local level. On the other, there is the difficulty of understanding the present inability of the left to conceptualize current transformations, resulting in its limited political intervention. We do not share the views of those who ultimately reduce social phenomena to macrorestructuring processes. Nor do we accept a microbehavioural analysis that ignores the international division of labour. Prioritizing one or the other of these is not an adequate basis for understanding the questions raised here. Microlevel accounts are important in explaining social phenomena, while macrolevel accounts cannot be reduced to these micro-explanations.

The intraregional differentiation that our research on northern Greece reveals is not directly derived from the fundamental contradiction between capital and labour, nor from choices made by capital alone. Gender, ethnicity, place of residence, etc. acquire importance as discriminatory criteria for the valuation of the work of individual agents, thereby structuring local labour markets in specific ways. They enable various segments of the workforce within the same regional economic structure to be isolated from each other and assigned to different positions in an hierarchical power structure.

In the course of restructuring a triple tendency may be observed: a tendency


to intensify existing forms of subordination (class, gender, ethnic or other), thereby increasing the advantages of divisions and the possibilities of surplus value and surplus labour extraction; a tendency to decompose such forms of subordination and enlarge the labour market by incorporating groups of people previously excluded; a tendency to recompose new forms of subordination, whereby the work of some parts of the workforce (e.g., women, ethnic minorities) is valued as inferior, thus retaining the advantages of low cost and division and curbing resistance.

Such processes and relations have been inadequately grasped by the left in Greece and in other European countries. In the past the Greek left has been mobilized on the basis of an anti-capitalist rhetoric challenging all forms of private property and all kinds of bourgeois traditions, led by the industrial male workforce, construction workers and segments of the peasantry. Today, the left and the trade unions, facing a variety of social demands, are experiencing a crisis, trapped as they are within outdated analyses and theoretical cliches. For example, while exploitation of local differences seems to have been an integral part of the locational choices of capital in Macedonia and Thraki, it has been left out of the analysis and strategies of the local unions and leftist parties which continue to analyse in terms of homogeneous categories of capital and labour. This has retarded, if not prevented, an adequate understanding of divisions and hierarchies within the working class and the development of policies meaningful to those low in the hierarchy; women, ethnic and religious minorities, the unskilled and the lowest-paid, those living in marginalized places - who form an increasingly important part of the potential social base of the left, but remain beyond its concerns.

In this paper we have purposefully stressed differences and specificities of place, rather than homogeneity and the logic of global strategies of capital, not least because it is at the local level that ‘noncapital’ - all those whose labour is appropriated by capital under many work relations and conditions - can organize and oppose or simply cope with pressures deriving from global strategies.

In a contradictory way, by advocating ‘unity’ and ignoring divisions (theoreti- cally, practically and prospectively) the left itself has contributed to deepening divisions. Its homogeneous, national working class has for a long time been in reality little more than the male, full-time wage workers in the formal economy. This limits the credibility of left-wing politics and perspectives among the majority of workers who do not conform to this image.

It seems that the way out of this political crisis of necessity has to be to contest such generalizations and to incorporate in analyses the conflicts and contradic- tions raised by a wealth of social relations which are created, exploited and reproduced in the course of capitalist restructuring. ‘Unity’ must be gradually built up upon the articulation of differences and individual experiences.

University of Thessaloniki, Greece National Technical University, Athens, Greece


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Flexible labour markets and regional development in northern Greece

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