German unions & the Great Recession: positions & responses

Transcription

1 WSI Summer School, Berlin September 2012 German unions & the Great Recession: positions & responses Dr. Heiner Dribbusch, WSI

2 Overview Union identity and culture The tradition of corporatist crisis management Responding to the Great Recession 2 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

3 I Union identity and culture 3 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

4 Richard Hyman s triangle Society DGB Market Class 4 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

5 Union party links Historical link with Social Democratic Party unions motor of Social Democratic reformism Marginalisation of communists with start of Cold War Socialist tendencies survived as minorities 5 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

6 The privileged partnership with SPD crumbled with the neoliberal turn of SPD the severe cuts in social security (Agenda 2010; extension of pension age) Social democratic dissidents from within the unions help to establish new Left Party (Die Linke) With SPD in opposition since 2009 new approachment 6 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

7 German unions and globalisation Acceptance of the paradigm of national competitiveness Belief that competitive advantage can best be won through investments in education to improve productivity and via the pacifying effects of the welfare state with its integration of the unions 7 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

8 At its 3rd congress in 2005 IG BCE adopted a motion on globalisation: [...] through access to new markets, globalisation offers additional opportunity, particularly to the export-driven German industry. [ ] This also benefits and strengthens industrial locations in Germany. 8 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

9 And it continues: [...] To make sure this does not lead to a ruinous competition for ever lower standards and wages, global minimum social and ecological standards are required. 9 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

10 These views are broadly shared by many within the union movement Differing views between DGB affiliates whether and how to co-operate with critics of neo-liberal globalisation (e.g. ATTAC et al.) 10 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

11 II Tradition of corporatist crisis management 11 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

12 Preconditions Significant union presence Disruptive potential of workers A shared interest of employers and unions that a consensual restructuring helps to avoid costs and proves to be more effective 12 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

13 Pattern Productivity coalition (Windolf) / coalition for competitiveness (Rehder) Unions mediate restructuring in exchange of limited job guarantees Red line: forced redundancies Instead: so-called socially acceptable job reduction, i.e. early retirement, voluntary redundancy with compensation interest of employers in young workforce in conflict with legal protection against dismissal incentive for negotiated job cuts Legislation to support negotiated crisis management Adjustment of collective agreements to support these efforts 13 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

14 A long record 1960s onwards: coal mining 1970s and 1980s: steel industry 1980s until mid 1990s: ship building 1992/93 onwards: Alliance for Jobs and Competitiveness at company level: negotiation of so-called Pacts for Employment and Competitiveness (PEC) 2008/2009: Great Recession 14 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

15 III Responding to the Great Recession 15 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

16 Shared analysis The financial and economic crisis which escalates in autumn 2008 is largely analysed by German unions as a result of a deregulated financial market frequent: dichotomy of real economy ( good capitalists) versus financial economy ( bad capitalists) employers and employees both victims of greedy investment banks and hedge funds 16 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

17 Different consequences of crisis Unions were differently affected by the crisis ver.di financial services only mildly affected in terms of employment mostly affected in transports and logistics not directly affected in public services, health care and commerce IG Metall massive drop in incoming orders and production fear of deindustrialisation crisis regarded as threat to its very existence IG BCE chemicals heavily hit by slump in car industry 17 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

18 Common goals Major political demands: the crisis shall not be solved on the backs of employees to this end it is necessary to protect in various ways the industries concerned re-regulation of the financial markets further democratisation of the economy 18 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

19 Competing demands Neither joint reaction nor joint approach by all DGB affiliates ver.di: public investment program to strengthen public service strengthen domestic demand, diminish export dependency IG Metall: public equity fund to stabilise manufacturing the fund shall be financed by an excise tax on large fortunes the fund shall be publicly controlled IG Metall finds common ground with IG BCE in aim to stabilize export oriented manufacturing sector 19 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

20 Corporatist crisis management: the case of metal working 20 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

21 M+E industries incoming orders 2008/ Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

22 IG Metall December 2008: No dismissals Three levels of crisis intervention: state / government action industry / collective bargaining establishment / works councils & management 22 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

23 State IG Metall and employers in M+E demand government intervention: a car scrap bonus to stimulate demand extension of short time work from 12 to first 19 then 24 months 23 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

24 Short-time work in M+E by month Oct 2008 Dec 2010 (in 1,000) Oct 08 Nov 08 Dec 08 Jan 09 Feb 09 Mar 09 April 09 May 09 June 09 July 09 Aug 09 Sep 09 Oct 09 Nov 09 Dec 09 Jan 10 Feb 10 Mar 10 April 10 May 10 June 10 July 10 Aug 10 Sep 10 Oct 10 Nov 10 Dec Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

25 Production & registration of new cars Domestic production of vehicles Registration of new vehicles 6,500,000 6,000,000 5,500,000 5,000,000 4,500,000 4,000,000 3,500,000 3,000,000 2,500,000 2,000, Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

26 Establishment level re-negotiation of PECs aims: cost savings and internal flexibility in exchange for maintaining limited job guarantees reduction of working time wide spread use of working time accounts concessions of the past now instrumental IG Metall organises expert consultancy for SMEs in some cases: union brokers state credits to avoid bankruptcy 26 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

27 Industry level New collective agreements in 2010 in M+E with special clauses for extended short-time working schemes 27 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

28 Why this revival of corporatism? Fear of social unrest on the side of government and employers Union as mediating and stabilizing factor IG Metall is still a power to be recognized the disruptive potential of auto workers is substantial Grand coalition government faces national election in Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

29 Overlapping interests Employers, employees and union share interest in avoiding mass dismissals labour hoarding is a viable option as employers want to be ready if crisis is only temporary slump short-time work and working time accounts minimise costs employees want to keep jobs Union wants to stabilise its membership strongholds 29 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

30 Outcome 30 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

31 Employment in M+E industries in 1,000 by quarter 3,706 3, or - 7,4% or +5,9% 3,665 3,641 3,642 3,633 3,609 3,574 3,528 3,499 3,465 3,483 3,509 3,548 3,437 3, Source: destatis; IG Metall; figures include self-employed and exclude agency workers 31 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

32 A comparatively mild dip in employment Employment M+E (W. Germany) annual changes Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

33 Favoured by a relatively quick recovery M+E industries incoming orders 2008/2009, change to previous year Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

34 A win-win situation? 34 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

35 Who paid the bill? Employees with fixed term contracts and temporary agency workers both quickly lost their jobs Not only internal flexibility work time accounts etc. but also external flexibility was instrumental in stabilising core workforces Core workforces paid with various concessions All employees are hit in so far as the success of the crisis management is a stimulus for employers to expand non-standard precarious employment 35 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

36 Temporary agency workers in M+E , in 1.000, as of 30 June each year ,4 % Source: IAB, establishment panel; IG Metall 36 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

37 Limits None of the more far reaching political demands of neither ver.di nor IG Metall made it on the political agenda the mobilisation for these demands remained weak not all employees felt affected by crisis for some employees the crisis had begun long before 2008 crisis as daily experience 37 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

38 Outlook 38 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

39 Facing the Euro crisis 2012: The economic imbalances within the EU remain Trade unions face the challenge to deal with their differences and to find a coordinated answer to the current crisis 39 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

40 Economic recovery GDP, adjusted for prices, 2008q1=100 Source: Eurostat, calculation IMK. 40 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

41 Employment 2008q1=100 Source: Eurostat, calculation IMK. 41 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012

42 Thank you for your attention! Dr. Heiner Dribbusch Institute of Economic and Social Research (WSI) Hans-Böckler-Stiftung Düsseldorf, Germany 42 Heiner Dribbusch, WSI Summer School, Berlin Pichelssee September 2012