The Crisis of Labour Relations in Germany

It is generally agreed amongst academic commentators that the combined pressures of increased international product market competition, market deregulation and unification have severely strained the German ‘model’ of industrial relations (e.g. Goodhart, 1994; Carlin and Soskice, 1997; Gall, 1997; Streeck, 1997). Employers’ fear of the relative decline of German industrial competitiveness have prompted some rethink of the continued value of regulated collective bargaining. A fragmentation of previous patterns of collective bargaining is taking place which can usefully be described as a process of regulated decentralisation of pay determination. Active neoliberal economic agendas, associated as they are with market deregulation, have entered German Realpolitik somewhat later than competitor nations, with some commentators (e.g. Marsh, 1996) suggesting that the difficulties of unification acted to delay an overdue process of restructuring of German industry. Restructuring, however, is now very much in evidence in the German case, as witnessed by large scale job losses, permanently high levels of unemployment and moves to introduce Anglo-Saxon ‘shareholder’ values at the expenses of traditional ‘stakeholder’ values associated with the German ‘consensus’ model. The Crisis of Labour Relations in Germany