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date: 27 May 2017

Labor Politics in the Neoliberal Global Economy

Summary and Keywords

Labor in the global neoliberal economy is configured by overlapping networks of power in a manner that sustains imperial patterns between nations and the profitability of transnational corporations (TNCs) in many ways. New forms of institutional controls enabled by the World Bank and International Monetary Fund usher in new categories of workers—part-time, temporary, flexible—and precarious forms of work. The advancement of technology is increasingly interdependent on the exploitation of labor. This article critically explores the implications of neoliberalism in transnational labor involving women employees and the employees in the offshoring industry in general in the global South—the two workforce categories boosting profits for TNCs but remaining invisible for the most part and suffering precarity while driving global capitalism.

Keywords: neoliberalism, labor, offshoring, transnational feminism, precarity


With its increasing speed and penetrations of movements of capital and international migration of people across borders, globalization has significant consequences for labor conditions in the 21st century. The growth of transnational corporations (TNCs), along with new forms of production, is part of the process. The free market conditions or the reduction of state controls with the substitution of other controls and the potential commodification of almost everything are other aspects of present changes (Acker, 2004) that are redefining labor practices across the world. As a result of increasing privatization and decreased state control, gone are the protections toward local firms and public sectors and welfare state supports. Missing in action are the vibrant unions. These changes in the name of free trade and market economy impact workers’ health and safety and are detrimental to the environment. These are consequences of neoliberalism, the most dominant economic political thought in the global economy. The rules of neoliberal trade are established through the World Trade Organization (WTO) and International Monetary Fund (IMF) where nation-states globally abide by them or face penalties (Harvey, 2005). Establishing the neoliberal rules as a hegemonic set of practices, the WTO and IMF have played key roles in realigning national governments in the Third World with the international market-driven economy (Harvey, 2005). These institutional policies and power sustain colonial modes of development in the postcolonial Third World and have led to global economic, social, and cultural disparities (Banerjee, 2011; Dussel & Ibarra-Colado, 2006).

These new forms of institutional controls, on the other hand, usher in new categories of workers—part-time, temporary, flexible—and precarious forms of work. The rules of engagement as set by the WTO and IMF play a significant role in enabling further expansion of digital labor. Geographical expansion of the division of labor driven by capitalist expansion has new implications for the global environment as labor and other resources are being accessed mostly from outside the local area. There is growing interdependence between the exploitation of labor, advancement of technology, and degradation of nature (Maxwell & Miller, 2008). Organizational restructuring, downsizing, new forms of flexibility, and new forms of employment relations are parts of free marketization (Acker, 2004). Finally, the new economy based on technological innovations contributes to new labor conditions globally. Against this backdrop, this article critically explores the implications of neoliberalism for transnational labor, especially women employees, and employees in the offshoring industry in general in the global South—the two categories of workforce boosting profits for TNCs and driving global capitalism.

Labor in Offshoring

International outsourcing—offshoring of service work and digital labor—has grown exponentially in the neoliberal economy. Digital labor here refers to labor in the network of digital production—miners, processors, assemblers, and information workers—who stand in specific relation to production (Fuchs, 2016). Catering to Western corporations at a cheaper rate, the offshoring industry is a Third World phenomenon driven by technology, free capital movement, viable labor conditions, and altered temporalities and spatialities (Taylor & Bain, 2005). However, much of the labor in offshoring remains invisible.

“Who produces computers, laptops, mobile phones?” asks Fuchs (2013). This pertinent question touches upon the complex processes of digital labor involving extraction of minerals in African mines under slave-like conditions, information and communication technology (ICT) manufacturing, assemblage in China (Foxxcon) under poor working conditions leading to a number of suicides, and stressful information work, among other forms of digital labor. The consumer sees labels like Apple, Google, Motorola, Sony, and Samsung, even though these companies are mere actors in selling the products and are making profits from the sales. Fuchs argues that the complex global division of digital labor contains multiple production points and forms of labor that remain invisible to the user. Yet ICTs remain heavily dependent on this system. The multiple forms of labor are objectified in a single device obliterating the intricate spatial and temporal history of production of the device.

The call center employees in the service industry providing customer service to a number of organizations answer phone calls or make calls to customers in other countries. They adopt foreign names, learn to speak in foreign accents, and work through the night to cater to different time zones. They lack identity as they lack a clear place in the hierarchy of workforce and social order. Not having developed any collective occupational identities to represent their work and their liminal position at the interface between the companies and customers—and the global and the local—poses difficulties for call center workers (Huws, 2009).

India is a leading destination for global outsourcing with a market share of 37% and revenues of $16 billion in 2012 (Nasscom, n.d.) and employment of 8.7 million employees. China, The Philippines, South America, and South Africa are alternate business process outsourcing (BPO) destinations. The United States accounts for 59% of the world’s spending on these back office functions. The attraction of India for U.S. firms is the large English-speaking, highly skilled, and inexpensive workforce. Moreover, countries involved in outsourcing are taking initiatives to facilitate this further by setting up infrastructure and offering tax exemptions. In India, industry associations lobbied for exemptions in state labor legislation so that call center workers can work at night (Poster, 2007). Most of this work is done for companies in the United States and the United Kingdom. General Electric, Dell Computers, and American Express are among these, hiring up to 12,000 workers in their call centers (Poster, 2007).

A growing scholarship on call centers examines the dynamics of this new workforce and raises important questions for our understanding of labor, service industries, and technology under globalization. A body of research has described call centers as “electronic sweatshops” (Fernie & Metcalfe, 1998) and “assembly lines in the head” (Taylor & Bain, 1999) that emphasize factory-like division of labor (Taylor & Bain, 1999; Van den Broek, 2004), with jobs being characterized as dead end, with low complexity, low control, repetition, and routineness (Knights & McCabe, 1998; Taylor & Bain, 1999; see also D’Cruz & Noronha, 2006). Simplified tasks, predesigned service specifications, scripted dialogues—all designed to minimize labor costs—are subjected to tight control and surveillance made possible by highly sophisticated computer technology (Deery & Kinnie, 2004). Routinized tasks and excessive control cause dissatisfaction among call center agents. Call centers alter the basic nature of interactive service work in terms of who is doing what work, for whom, and why. Services that used to be for locals by locals are now done by workers in the Global South for consumers in the Global North (Poster, 2007). Poster (2007) argues that nationality is therefore an integral part of the interaction, and this has many implications for classic theories of discipline and control.

Scripting for this group of transnational labor defines the conditions of the workers in many ways. These are sets of speech rules aimed at routinizing tasks for workers. Poster (2007) writes that the script may tell workers what to say, it may assign particular words to use, or it may outline the manner in which to use them—a practice of managerial control resonating with Taylorist managerial paradigm that removes all possible thinking from work. Drawing from Leidner’s work, Poster argues that scripting allows managers to regulate the behaviors of multiple actors (customer and employee) in the service relationship simultaneously.

Within the call center industry, this pattern of relations has now expanded manifold. As Poster (2007) describes, the groups now include the U.S. client firms, which contract the services of the call centers; the U.S. customers who phone into the call centers or who receive calls from them; the managers who run the call centers; and the agents who conduct the calls. What are the implications for control, authority, and agency among each of these actors in this context? This is now far more complicated than service work in local settings given the transnational nature of labor involved in this industry. Globalization also brings forth the nature of “emotion management” in interactive service work (Hochschild, 2003), where employees are required to suppress negative feelings and display emotions of niceness on the job. Because the central concern for the employers is the quality of the service interaction, managerial strategy rests heavily on the presentation of self (i.e., the way workers look, talk, and display feelings) (Poster, 2007).

However, these rules extend beyond managing emotions to managing identity and nationality in the global outsourcing industry. These corporations in the outsourcing business impact the concept of selfhood of employees. Cultural-ideological control asks employees to redefine themselves (D’Cruz & Noronha, 2006) through locational masking. The practice of changing one’s national identity for the job has immense implications for the employees, where many complain of not liking this “identity crisis” (Pal & Buzzanell, 2008).

Finally, call center work in the Third World is inextricably linked to imperialist patterns of neoliberalism, with TNCs defining the norms of the work. What sustains these patterns is the construction of outsourcing industry as an opportunity leading to prosperity in Third World nations. Such rhetoric of benevolence is a hallmark of neoliberal hegemony that masks the power of market actors, such as TNCs over the Third World (Banerjee, 2008). Offshoring has been predominantly studied as a site of domination that sustains domination-subordination patterns. However, Pal and Buzzanell (2013) demonstrate how it also offers resistance in the cracks of global capitalism. The authors argue that the conversations between the employees in the developing world and the clients in the developed world force alternative knowledge into global capitalism and somewhat defeat the imperial agendas of the TNCs.

Powerful forces are driving offshoring in the English-speaking developing world, particularly the central capitalist agenda of cutting costs and maximizing profits and shareholder value (Taylor & Bain, 2005). The different levels of difficulties bring forth precarity as a key phenomenon with respect to digital labor (Brophy & de Peuter, 2007). Precarity is “the financial and existential insecurity arising from the flexibilization of labor” (Brophy & de Peuter, 2007, p. 180). Precarity marks the worker’s life with immense uncertainty, where the part-time worker is consumed by possibilities of being called for work at non-work time, and the self-employed worker cannot refuse any contract for fear of a future drop in the flow of income. The flexible schedules are precarious for digital labor as workers are anxious about lack of money on the one hand, and excessively preoccupied with prospects of work on the other. Hence, labor precarity affects one’s relationship with time and is also social precarity (Brophy & de Peuter, 2007).

Moreover, the harsh conditions of work involving excessive pressure to deliver, continuous surveillance, long shifts, and night shifts take a toll on workers’ health and social life, leading to a high attrition rate. Neo-imperialist demands of locational masking (to hide where they are calling from) by way of adopting Western pseudonyms or speaking with foreign accents in the service industry put significant psychological strain on the employees. Denial of identity at the command of overseas clients deepens worker dissatisfaction and often prompts them to exit. Women, who constitute half the workforce, are affected more by the conflicting demands of working hours and social responsibilities and experiences. The next section discusses the relevant issues surrounding women and labor in the global landscape.


Globalization—the process of cultural convergence and divergence occurring on a transnational level—is much about class, race, and gender relations (Acker, 2004). But gender is often invisible in the dominant discourse on globalization. Acker (2004) argues that globalization is presented as gender neutral, even though some theorists do pay attention to women’s employment (see Castells, 2010). Gender neutrality reinforces the masculine standpoint implicit in the macro-structural models and, hence, perpetuates patriarchal functioning of social relations in general (Freeman, 2000). For example, boundaries, such as those between the public (male) and the private (female) contribute to practices of power that maintain the dominance of men (see Acker, 2004). Acker also argues that conceptual boundaries may also maintain the dominance of globalizing, gendered capitalism. In this regard, transnational feminism provides an important theoretical lens for recognizing a complex logic of patriarchy, where global connections and disconnections continually shape gender. In other words, transnational feminism engages with concerns of women around the world as they stand in relation to multiple patriarchies and economic hegemonies (Grewal & Kaplan, 2006). It invokes the location of the organization within asymmetrical relationships of nations and cultural and economic inequities of globalization (Shome, 2006).

Consider the ecological struggles of the rural poor (for conservation of resources) across the world that are also considered to be gender struggles. As Escobar (1995) explains, many aspects of the destruction of production conditions that arise from a Western model of development initiatives of state-backed corporations are reflected in increasingly difficult access to food, water, and fuel, all of which are women’s tasks in many parts of the world—they affect women particularly and contribute to restructuring class and gender relations. Women sometimes are able to seize these conditions to struggle for the defense of production conditions and their identities. Generally speaking, women’s struggles against the capitalization of nature and patriarchal control have largely remained invisible. Transnational feminism makes such subordination of women visible by incorporating gender and women’s struggles into the theorization of capital and nature (Escobar, 1995).

Its emphasis on geopolitical arrangements of nations also allows transnational feminism to explore the impact of intersectional politics of gender, global technology, and the informational economies. Such intersectionalities are staging new digital borders and boundaries of contemporary modernities (Shome, 2006). Consider the outsourcing of hi-tech, info-centered labor and its implications. Carla Freeman’s work (as cited in Shome, 2006) shows how Caribbean women’s identities are shaped by their incorporation into this newest form of transnational labor. It shows the complex ways in which relations between global economy, race, gender, nation, and ideologies of modernity shape identities of Caribbean women who work in such global electronic spaces. The organizations become sites of colonial surveillance as well as sites for local women repositioning their identities as modern in relation to their traditional local contexts. Such frameworks help us revisit the issue of feminization of labor, where the transnational flow of technology and information-centered labor stage new gendered modernities (Shome, 2006).

Drawing attention to the gendered nature of globalization exposes the discontinuities between the realities of women’s and men’s lives and mainstream scholarly work about global processes (Acker, 2004). Gender as used here, following Acker, is defined as inequalities, divisions, and differences socially constructed around assumed distinctions between female and male. Gender consists of material and symbolic aspects of existence, constantly reconfigured in the course of ongoing social activities and practices. Most feminist analysts of gender and globalization use the notion of gender as socially produced and highly variable while recognizing the predominant subordination of women within gender relations. The changing roles of women in transnational subcontracted work illustrate the phenomena.

Transnational subcontracted work has targeted vast numbers of women. Salzinger (2003) has noted the overrepresentation of women in export-processing industries. Women are the lower-paid half for all offshore work in developing countries (Ong, 1991). They are concentrated in a few industries: textiles, apparel, electronics, and footwear. These sectors provide the largest amount of manufacturing employment for women globally. An estimated 40 million workers, most of them women, work in global garment production, and the industry is set to grow year by year. The garment industry was one of the first to relocate manufacturing to Asia and elsewhere in the 1970s, when improvements in transport and communication made geographical distance less significant (Hale & Wills, 2007). Feminist economists drew attention to the gendered nature of this division of labor. They pointed out that the profitability of the textile and garment industry has always relied on the exploitation of female labor. Women are preferred to men in the garment industry in both Asia and Europe for strikingly similar reasons. Following patriarchal norms, women are not expected to earn a living wage and are regarded as docile (Elson & Pearson, 1984).

Mirchandani (2005) also points out that women are considered to be well suited for these jobs in ideological terms, such as natural dexterity. For example, women are preferred to men for Mexican maquilas as femininity is linked to productivity and masculinity to disruption (Mirchandani, 2005). However, more recently, scholars have noted defeminization of offshore work in the apparel and microelectronics industries. Nanda (2000) argues that information-centered labor, computer-aided manufacturing, and flexibility in production techniques are changing the skill requirements and gender composition of the workplaces. Women face the risk of being replaced by men as these jobs are considered better and more skilled. Recruitment of men is growing in maquiladoras that typically employ equal number of men and women. The workers are not ungendered but masculinized (see Mirchandani, 2005). Minor increases in pay and shop-floor autonomy have made men appropriate for these jobs (Salzinger, 2003).

In other words, if jobs are considered better in terms of pay and skill requirements, men are preferred to women. Such practices demonstrate how gender has always been a resource for globalizing firms for low-wage labor. In a number of countries, women and often children have been drawn into production for the world market and into wage labor in transnational organizations (Acker, 2004; Ong, 1991). Although such employment often adds to the income of poor families, it is exploitative in nature. Multinationals set up production units in locations where labor laws and unions are weak and women workers are still attached to peasant families for profit-making (Acker, 2004). Another predominant aspect of this profit-making drive is establishment of free trade zones (FTZs). In addition to food and crops developing countries would produce, Ong (1991) provides an excellent analysis of FTZs. To attract foreign capital, local governments offer tax-free privileges, buildings and utilities, and ease of repatriation. The initiative coincided with the green revolution sponsored by the World Bank and IMF. Ong writes: “The two-pronged strategy for developing poor countries was elegantly simple. The commercializing rural economy would supply and feed the labor released for work in the free-trade zones” (1991, p. 281). Host governments thought that this was an opportunity to address unemployment and hoped that off-shore industries would employ the huge number of male migrants. Instead, as Ong (1991) points out, foreign companies investing in FTZs sought young single women.

While all these examples originate from developing countries, labor from immigrant populations constituting primarily women continues to be a resource for employers in the rich Euro-American nations (Acker, 2004). Gender is particularly a resource for offering multiple support services needed for transnational business in “global cities” (Sassen, 2001). In global cities the work of provisioning, cleaning jobs, childcare, and other such care work must be done so that the global elite can go easily about their business (Acker, 2004). These tasks, Acker argues, are performed disproportionately by women from Third World countries and show how transitional gender relations inform caring work. For example, Filipinas and Guatemalan women migrate to the United States to become domestic workers for affluent women whose professional careers are thus facilitated. All these phenomena demonstrate how gender relations in work coupled with class and race relations are intertwined with global processes and capitalist production.


This article highlights how neoliberalism relies on various gender and race relation patterns across borders for the production of labor power. The conditions of transnational labor involving women and in the offshoring industry in general—the driving forces of global capitalism—illustrate that the struggle between capital and labor in any country is facilitated by the state. The colonial-neocolonial state is instrumental in transferring the surplus to advanced countries by organizing conditions of production attractive to foreign capital (Ong, 1991). For instance, export-industrialization, offshoring of services, and gendered work in the Global North have been made possible by state interventions at the behest of TNCs and global financial institutions. These initiatives have been central to generating profits. Concomitantly, in order to sustain the disciplinary mechanisms of the workplace, the various modes of control operate through interconnected networks of power in the workplace. The state not only intervenes to weaken labor movements and ensure peace at the workplace but regulates daily social life, promotes certain norms, practices, ideologies, and identities while marginalizing others to produce ideal labor force.

The information and communication technologies, English-speaking skills, and cheap labor pool have led to the growth of the offshoring industry in the developing world that managed to compress time and space. Successful transaction between the employees and clients in the call centers depends on linguistic skills and cultural knowledge. Offshoring work is intricately connected with race relations as individuals from different parts of the world interact with each other. Negotiation of identity, navigation of cultural boundaries, health hazards due to night shifts, routinized and scripted work, and continuous monitoring are pressing issues for call center employees. But this work is immensely successful in generating profits for the circuits of capital.

Similar to relying on race relations and geopolitical arrangements, the neoliberal economy exploits gender patterns for profitability. Gendered images and ideologies of femininity and masculinity are used to construct desirable workforce and desired behaviors (Acker, 2006). Women are considered naturally appropriate for certain jobs, believed to be submissive and compliant, and paid substantially less than men. Feminization of labor and defeminization of labor are used strategically by TNCs to serve international capital. In contrast, in the rich developed countries images of successful female professionals are sexualized and gendered in the media and presented as smart, competitive, and examples of feminine success. While this discussion has not been included in this essay, it is important to recognize, Acker (2004) argues, that such images suggest the changing class configurations of gender in the centers of capitalist global power. Overall, labor in the neoliberal economy is configured by overlapping networks of power in a manner that sustains imperial patterns between nations and the profitability of TNCs.


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