Precarising Formality: Understanding Current Labour Developments in Chile

Abstract

More than forty years ago, the Chilean economy led the way in a process of flexibilising and privatising a wide range of areas: finance, pensions, education, work and so on. In 1990, with the end of Pinochet’s dictatorship, Chile continued to pursue neo-liberal economic policies and maintained the liberal conception of collective labour rights (imposed in 1979). By 2017, labour informality in Chile was among the lowest in South America. Taking these two factors into account (labour regulation that benefited business spending cuts and only “moderate” informality), this article explores the following questions: What are the features of current forms of labour formality in a paradigmatic neo-liberal context like Chile’s, and what space does informality occupy? Is labour formality far removed from the kind of vulnerability usually associated with informality? How have formality and informality related to each other in Chile in recent years? We address these questions with mixed methods: a literature review, development of a conceptual proposal, processing of statistical data and case studies. We conclude that a particular kind of labour formality currently prevails in Chile, which we call precarising formality. This concept disputes the traditional idea of labour formality, both because labour regulations lack substance and because they are ineffective, which is, of course, politically produced. We consider it precarising based on an analysis of multiple dimensions of precarity in contexts of theoretical labour formality. The article also describes forms of struggle and resistance by workers’ organisations that protest against capitalist action from within this new configuration of labour. KEYWORDS: formality; informality; labour precarity; Chile