Hiring, Firing, Atomizing; Manpower Agencies and Precarious Labor in Kazakhstan's Oil Sector

Abstract

This paper analyses the influence that manpower agencies have on hiring practices and employment in Kazakhstan's oil sector. While influenced by the literature on transition from planned to market economy, this article's main argument is rooted in the understanding that labor precarization is produced through transnational capitalist practices. The influx of foreign capital through the investments of transnational companies (TNCs) also transplanted into Kazakhstan's labor market their antilabor policies and practices. This welcomed the presence of a new, dedicated actor for the establishment and curation of labor relations, namely manpower agencies, especially in the oil-rich region of Atyrau. This article argues there, the rationale for the presence of manpower agencies and the absence of trade unions is directly linked to the activities of TNCs. Manpower agencies have a decisive role in making employment and labor increasingly precarious in the oil sector. Manpower agencies function as a disaggregation force in the oil industry. Their presence stimulates a race to the bottom among workers, who have no other option but to accept precarious, unsafe, and underpaid jobs. Against this backdrop, the paper also offers a peek into “industrial gossip,” gathered during fieldwork in the Atyrau region. This more anthropological side of the argument highlights how the world of manpower agencies helps TNCs thrive by creating an atomized workforce.

Governing the Extractive Sector: The Politics of Authoritarian Neoliberalism and Labor Resistance in Kazakhstan

“…Moreover, recent research has found that working in the oil sector has little appeal to the local population. This may be due to tough working conditions, which often require 14-to 28-day shifts away from the family, working in harsh weather conditions, and living in labor encampments which often do not meet sanitary standards (Sorbello 2023;Kesküla 2018;Trevisani 2018;Yessenova 2015;Jäger 2014). That revulsion may also be linked to the restructuring measures in the employment sector, initially introduced and enforced by the transnational oil companies, but tacitly supported and defended by the local state.…”

“…That revulsion may also be linked to the restructuring measures in the employment sector, initially introduced and enforced by the transnational oil companies, but tacitly supported and defended by the local state. One such policy concerns the strategy of the employer company to split labor between regular companies and subcontractor companies that provide goods and services for the main operation company (Sorbello 2023;Totaro 2023;Trevisani 2018). According to some estimates, the oilfield sector is represented by more than 2000 service companies at the moment that have different ownership forms and affiliations (Economic Research Institute 2021).…”

“…The practice of splitting work between regular workers and subcontractors has grown particularly since Zhanaozen and is infamously known as the "optimization policy" (Totaro 2023). Officially the policy was justified on the grounds of increasing competitiveness, but, as growing research shows (Sorbello 2023;Totaro 2023;Trevisani 2018), the practice generates a lot of injustice and harbors the seeds of conflict (Trevisani 2018). This is because the policy affects both working conditions and wage distribution, which are not equal between workers in regular companies and those in subcontractors.…”

“…Foreign service companies are companies run by foreign companies. As Sorbello reports, the transnational oil companies often favor foreign service companies over local Kazakh ones, which in turn outsource labor to local service companies (Sorbello 2023). Quasi-state companies include service enterprises that are partially or fully controlled by the state but operate like private companies.…”