Germany’s Once-Protected Workers Are Feeling Vulnerable
From assembly lines to retail counters, these are bitter and confusing days for the German worker.
Globalization, layoffs and a harsh corporate climate are weakening unions and threatening some of the most protected workers in the world. The economic troubles have triggered a barrage of cost-cutting measures by the nation’s biggest employers, including Siemens, DaimlerChrysler and Opel, the largest European division of General Motors Corp.
The cuts -- which may include 45,000 layoffs nationwide -- come as unemployment hovers around 10.5% and Chancellor Gerhard Schroeder overhauls generous welfare programs. Like U.S. steel and automotive employees in the 1980s, German workers are psychologically under siege.
“All the companies seem to be using the same slogan, threats of massive job cuts,” said Marco Dummer, a 15-year veteran at Opel’s factory in the western city of Bochum. “You feel bad. It’s already stressful to be working on the conveyor belt, and now there’s an added burden hanging over us that we could be laid off. We fear the future.”
GM said this month that it would cut 10,000 jobs at Opel, mainly from its plants in Bochum and Ruesselsheim. The move culminated a series of unsettling labor announcements that shook the middle class. Opel workers staged a six-day strike but have returned to their jobs as company and union officials negotiate other options to save nearly $640 million.
But analysts predict that large layoffs are unavoidable. A spokesman for Schroeder said Opel’s problems were the result of “severe management errors” by GM.
The crisis at Opel follows a labor agreement this month at KarstadtQuelle, Germany’s giant retail chain, to freeze wages and cut 5,500 jobs in coming years, which would save nearly $970 million. Last summer, Siemens and DaimlerChrysler revealed how vulnerable Germany’s unions had become by forcing employees to work longer hours for the same pay -- a move that would have been impossible a few years ago.
German workers once enjoyed short workweeks and company-paid spa vacations. But sluggish economic growth, Schroeder’s insufficient reforms and threats by companies to move plants to other countries have resigned workers to less coddling. Volkswagen is threatening to cut or relocate as many as 30,000 jobs unless German unions accept concessions on wages and other issues.
The recent expansion of the European Union has more German corporations looking east toward Poland, the Czech Republic and other lower-wage countries. An analysis by Der Spiegel magazine of wages and benefits paid by GM in Europe found that a worker in Poland costs 15% what his German counterpart does. A GM worker in Sweden costs 56% of the German rate and a worker in Spain costs 64%.
“The mental change has already taken place for the German workers,” said Holger Schaefer, a labor market analyst with the Institute for the German Economy in Cologne. “Most workers know in the long term they will lose their higher wage. Globalization cannot be stopped.”
The west German manufacturing worker is the third-highest-paid in the world, earning benefits and salaries totaling $34.51 an hour, compared with $35.86 in Norway and $34.82 in Denmark. But German companies pay the highest benefit contributions in the world. These costs have enhanced trade unions but have long troubled corporations that are now experiencing increased pressures from world markets.
“Unions are realizing their power is fading, and the public is realizing this too,” said Thomas Straubhaar, president of the Hamburg Institute of International Economics. He added that recent concessions by unions had signaled a rethinking of the German welfare state and the “beginning of a new Germany. We have thrown off the yoke.”
IG Metall union criticized GM for the “blunt” manner in which it announced the possibility of layoffs at Opel.
“GM never tried to understand the European culture of industrial relations,” said Oliver Burkhard, an IG Metall official, who blamed GM for not working closely with the union before announcing the cuts. “No one told the workers why these cuts are necessary. This makes people angry. At least DaimlerChrysler explained its reasons to the union. Europe has a different way of doing things than the U.S.”
GM rejected that characterization.
“I don’t find that to be true in any way,” said Tony Cervone, a spokesman for GM Europe. “The way in which we did this was very transparent. It didn’t have to do with the way we announced it. It has to do with the magnitude of what we need to do to cut costs.... There’s been an emotional reaction.”
Cervone would not say how long GM would negotiate with the union. “This isn’t like wine,” he said. “The situation is not getting better with age. There’s a sense of urgency.”
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Petra Falkenberg in The Times’ Berlin Bureau contributed to this report.
