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German labour relations now worse but not bad

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Olaf Storbeck
Last Updated : Jul 22 2015 | 10:08 PM IST
In May, combative train drivers brought German railways to a near standstill. In June, millions of letters remained undelivered when postal workers followed suit. In the same month, kindergartens closed their doors as teachers went on strike. Lufthansa pilots may resume industrial action soon.

There is a whiff of strike-struck Britain in the late 1970s about Germany in 2015. During the first seven months of the year, 26 workdays per 1,000 employees were lost due to labour unrest, new data by the Cologne Institute for Economic Research shows. That's more than in the previous seven years combined. It is the highest level since 1992.

It is worse than in the recent past. But labour relations in Germany are not that bad. In Spain, the toll per 1,000 employees stands at 61 days. In France, the figure is 139, according to the Cologne Institute. In 1984, when German metal workers went on strike in support of a 35-hour working week, nine times more working days were lost than today.

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Competition among different unions also plays a role. A landmark 2010 ruling of the Federal Labour Court strengthened the prospects of smaller players and seems to have encouraged the newer entrants to flex their muscles. The train driver strike is a case in point. Still, a new law agreed by the Bundestag in May means such walkouts will soon be a thing of the past. It decrees that only the biggest union in a company can go on strike.

The core of the German economy - manufacturing - is largely spared the pain. International competition and outsourcing have made industrial workers less antsy. Over the last decade, more than three out of four strikes happened in the service sector. Meanwhile, greater productivity gains than in the service sector make it easier to reach deals that please all sides.

Cooperation between unions and employers has driven Germany's economic success. Unions usually give short shrift to companies that deviate from the desire to maintain an overarching consensus. Sure, the headline-grabbing recent walkouts darken the picture. But in manufacturing, the economy's core, employees and employers seem to appreciate that economic prosperity flows from crafting peaceful industrial relations.

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First Published: Jul 22 2015 | 9:31 PM IST

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