BARMETAL: Digitalisation, Automatisation and Decarbonisation: Opportunity for Strengthening Collective Bargaining in the Metal Sector: Hungary Policy Report

This report sets out to explore first, which processes, derived from the ongoing technological changes, in particular, digitalization, automation and decarbonization (DAD), have had an impact on the labour market, employment, working conditions and the quality of jobs in the Hungarian metal industry. Second, it explores the current situation – the scope and agenda of collective bargaining and social dialogue-, and more generally, opportunities and main challenges with respect to DAD in the Hungarian metal industry, with a greater focus on automotives. Special attention was devoted to highlighting trends or novel methods for strengthening social dialogue and collective bargaining in the metal industry within the conditions of technological change. The first two sections outline national and sectoral economic trends and labour market developments as well as the main characteristics of Hungarian industrial relations in metal manufacturing. Section three maps the overall developments of DAD in Hungarian metal manufacturing, how it impacts production, employment, skill formation and to what extent it enriches social dialogue and collective bargaining. As it is argued, technological change occurs with a structural delay in the country, with more significant changes occuring only recently. For employers, technological change occurs both as an investment and cost issue, but also as a pressure and requirement to stay afloat. Such pressure is especially felt by domestic small and medium enterprises (SME), typically lower in the production chain, especially in subsectors with high energy intensity production. Larger companies are leading the change, and have also established social dialogue structures, mirroring the Hungarian industrial relation structure. Social dialogue and collective bargaining is only indirectly affected by these changes. The issue of training and qualifications appears as a very important issue for both employers and trade unions, but skill formation is extremely decentralised, and company based. As the brief case studies in section 4 indicate, even in large companies with established industrial relation structures, aside from information sharing, collective bargaining does not, or has not yet dealt with issues of re-qualification, working time and training, or job redesign. The report builds on available statistical data, online reports, media sources and other documents as well as interviews with main stakeholders of industrial relations in metal manufacturing. In total, 15 interviews with 18 interviewees were conducted for the purpose of this study between June and November 2023. Respondents included representatives of general and specialised employer associations (2), trade union representatives on both regional (3) and plant levels (6), including works council members (3), white (1) and blue collar (3) employees as well as expert-consultants (2) to social partners. Interviews lasted between 40 minutes and 140 minutes, and were conducted mostly online. All but one of the interviews were recorded, transcribed and analysed1. Most interviewees were promised anonymity. For this reason, interviewees quoted in the text are only introduced in general terms. During the case selection period, additional inquiries and unrecorded conversations occurred with various plant level trade union representatives. The main purpose of these discussions was to assess the level and extent of technological changes in companies. Thus, valuable information was collected on all scales of sectoral development, regional characteristics, as well as at plant level developments with union presence and collective bargaining coverage.