According to a study by the Finnish Business Research Institute, the transition to company-specific agreements has not reduced wages in the forest industry or in the software industry.
Company-specific The transition to collective bargaining has not reduced wages in the forest industry or in the software industry, according to a study by the Norwegian Institute of Economic Research (Etla).
According to a study published on Tuesday, moving away from union-level bargaining had little effect on the level of wages or their dispersion. In the paper industry, the change even increased workers’ earnings.
“Concerns that moving away from union-specific bargaining would lead to a significant drop in wages were clearly exaggerated. The study published now shows that,” says Etla’s director of research who conducted the study Antti Kauhanen in the bulletin.
Metsäteollisuus ry and some of the member industries of Teknologiateollisuus ry started a few years ago, accompanied by heated debate, to move away from federal collective agreements.
Metsäteollisuus ry announced in October 2020 that it will no longer enter into federal collective agreements in the future. Teknologiateollisuus ry, on the other hand, announced in March 2021 that it would switch to a model where, in addition to the sector-specific collective agreement, there would also be company-specific agreements.
The changes in the bargaining system of collective agreements were predicted in some speeches to reduce wages significantly.
According to Etla’s research, the transition to company-specific bargaining increased the earnings of paper industry workers slightly and increased the internal wage dispersion of companies.
For white-collar workers in the paper industry, workers and white-collar workers in the mechanical forest industry, and the software industry, the effects are mostly in the same direction, but not statistically significant.
Research the income register was used in the implementation. The data from the income register is available from the beginning of 2019, and the data from the register was used as research material until December 2022.
In the study, statistical comparison groups were formed for the forest industry and the software sector, which were used to describe how wages would have developed if the sectors had remained in union-specific agreements.
The comparison group was formed as a weighted average from other industries, and the weights were chosen so that the explained variable develops in the target industry and the comparison group in the same way before moving away from union-specific bargaining.
The assessments were made separately for the paper industry, the mechanical forest industry and the software industry.
According to the study, the earnings of employees in the paper industry have increased by around 170 euros per month more than in the comparison group after the industry switched to company-specific bargaining. That’s about four percent of the industry’s average earnings.
The dispersion of earnings within the companies increased by around 230 euros. It can be compared to the industry’s average intra-company salary dispersion, which is around 1,340 euros.
Overall, according to the study, the effects of the transition to company-specific agreements on wages and wage dispersion have been moderate.
The study estimates that one interpretation of the results is that moving away from union-specific agreements does not really change the parties’ negotiating position.
“For this reason, the observed effects on the level and dispersion of wages are not very large,” writes Kauhanen in the study.
The results of the study are short-term results. In the longer term, the effects may be different, because the development of company-specific pay systems takes time.
The results are similar to the results obtained in similar studies conducted in Europe.
The research was funded by the Finnish Confederation of Industry and Employers Foundation.
HS show Etla’s research publication event live at 10 a.m. At the event, Etla’s director of research will present the results of the research Antti Kauhanen. The president of the Paper Association commented on the research Petri VanhalaCEO of employers in the technology industry Jarkko Ruohoniemi and a professor at the University of Helsinki Roope Uusitalo.
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