Nationwide protests as unemployment reaches new record high

At the end of January 1998, German unemployment reached a new post-war record high, with 4.8 million people registered as unemployed. The announcement of the latest unemployment figures were accompanied by nationwide protests by jobless people all over Germany.

At the end of January 1998, German unemployment reached a new post-war record high, with more than 4.8 million people registered as unemployed. The announcement of the latest unemployment figures on 5 February was accompanied by nationwide protests of unemployed people all over Germany. The protests were organised by independent organisations of jobless people, self-help groups and trade unions' jobless committees and groups. The unions played an important role in coordinating, organising and supporting the protests.

This feature summarises the latest developments in the German unemployment crisis, provides an example of how unemployed people are organised within trade unions, and then gives an overview of the protests and the reactions in political circles.

The German unemployment crisis

On 5 February 1998, the Federal Employment Service announced that a total of 4,823,200 people were registered as unemployed at the end of January 1998. This is an increase of about 164,900 on January 1997 levels, and of 301,600 on December 1997 levels. According to calculations by the Federal Employment Service, 12.6% of the civilian labour force (14% of the dependent civilian labour force) is now unemployed. This is a rise from 12.2% in January 1997 and 11.8% in December 1997. In the west, the unemployment rate is now at 10.5% (3,235,000 people) while the figure for the east is 21.1% (1,587,000 people). Across the German states (Bundesländer), the unemployment rates (on the basis of the civilian labour force) varies between 8% in Baden-Württemberg and 23.2% in Saxony-Anhalt.

Unemployment rates in Germany, January 1998
Germany 12.6%
Western Germany 10.5%
Eastern Germany 21.1%
Baden-Württemberg 8.0%
Bavaria 8.7%
Berlin 17.0%
Brandenburg 20.6%
Bremen 16.1%
Hamburg 12.3%
Hesse 9.9%
Lower Saxony 12.6%
Mecklenburg-Vorpommern 22.2%
Northrhine-Westphalia 11.5%
Rhineland-Palatinate 9.2%
Saarland 12.7%
Saxony 20.1%
Saxony-Anhalt 23.2%
Schleswig-Holstein 11.3%
Thuringia 21.1%

Source: Federal Employment Service (basis: civilian labour force).

However, there are two major problems associated with these figures. First, they do not include the many unemployed people who are on unemployment schemes (an average in 1997 of 1.12 million people, down from 1.42 million in 1996). Second, they do not include the people who might be searching for a job but are not eligible for benefits or not registered.

Unemployed people in trade unions - the case of ÖTV-Berlin

As in France (FR9708157F), the organisation of unemployed people within trade unions is nothing new in Germany, where the first initiatives date back to the mid-1970s. Today, most German trade unions organise unemployed people, some to a considerable extent, and also have special committees for their unemployed members. The metalworkers' union IG Metall alone organised more than 370,000 unemployed people in 1997 (DE9802147F). Here we look at the example of the committee of jobless people (Erwerbslosenausschuß) in the Berlin regional branch of the public services, transport and traffic union, ÖTV.

The historical development of the committee of jobless people inÖTV-Berlin started in 1977, when a "commission for temporary contracts and unemployment" (Fachkommission Zeitverträge und Arbeitslosigkeit) was created - one of the first of its type in Germany. In 1984, the existence of committees of jobless people was officially recognised by the ÖTV, which meant the first step of a structural integration into the trade union. Since 1990, unemployed people have been allowed to join ÖTV, and members of the committees of jobless people became delegates at higher levels in the union in 1992. In 1994, the general assembly of the ÖTV changed the union's constitution and allowed for the inclusion of unemployed members in its internal decision-making procedures at district level. In 1995, the first of the now regular annual assemblies of the committees took place. Since then, a committee of jobless people within ÖTV-Berlin has been elected and jobless members are represented on the regional union board.

The main tasks of the jobless people committee are as follows:

  • representation of unemployed members within the ÖTV and the DGB union confederation;
  • evaluation of local, regional and national social and labour market policies;
  • information on labour market policies and the unemployment benefits of unemployed members; and
  • cooperation with other organisations of jobless people.

The main objectives of the committee are to:

  1. achieve joint action by jobless and employed people in the fight against the social and economic causes of unemployment;
  2. improve the social and financial situation of unemployed people;
  3. fight discrimination against jobless people, and
  4. maintain autonomous collective bargaining.

The protests by unemployed people...

On 5 February, the day that Bernhard Jagoda, president of the Federal Employment Service, announced the new unemployment figures, there were a number of demonstrations held across Germany. Whereas the press reported more than 10,000 participants in 100 cities, the organisers of the protests speak of 40,000 to 50,000 demonstrators in around 200 cities. In Berlin, 2,000 jobless people demonstrated at the Brandenburg Gate, demanding Chancellor Helmut Kohl's resignation. In Nuremberg, between 100 and 200 unemployed people protested at the headquarters of the Federal Employment Service and declared the city the "capital of unemployment".

The protests were initiated and coordinated by the "trade union coordination committee of groups of jobless people" (Koordinationsstelle gewerkschaftlicher Arbeitslosengruppen) and many self-help groups of unemployed people. The demands of the trade union coordination committee were to repeal the latest changes in the Employment Promotion Act (Arbeitsförderungsgesetz), to reform the social security system, and to bring about working time reductions and a just distribution of work for all.

The initiators and organisers of the protests were rather disappointed by the low level of participation. According to the trade union coordination committee and the president of the association of unemployed people in Germany (Arbeitslosenverband Deutschland), until the general elections in September protests will be repeated each month on the day when the new unemployment figures are announced. The next such protest will take place on 5 March 1998.

... and the reactions

The actions were supported by the DGB and its affiliated trade unions. The DGB and IG Metall called upon their local and regional branches to support the unemployed people with their local actions.

Church organisations declared their solidarity with the protesting people, while representatives of most political parties stated that they understood the intention of the protests.

In the Bundestag, the latest statistics and the protests in the run-up to the general elections gave rise to a fierce debate on labour market policy and and exchange of the well-known arguments and accusations. The liberal-conservative Government came up with another "initiative for more employment" which, among other items, includes commitments to employ more people on welfare and the introduction of low entrance wages for long-term unemployed people. The initiative was immediately dismissed by the opposition parties and the trade unions as "half-baked".

Commentary

According to the Government, the German unemployment crisis is "the primary challenge facing all responsible - labour, management, trade, industry and the political sector."

Bernhard Jagoda has stated that the possibility of German unemployment hitting the psychological level of 5 million is still remote. Nevertheless, some observers fear that the awful 5 million mark may be crossed before long.

Many observers were surprised by the peacefulness of the protests of jobless people in Germany. It does not seem as if German unemployed people will become violent, and frst comparisons have already been made with the recent French protests (FR9801189F). One of the hypotheses brought to the fore as to why the Germans did not make use of "strong-arm tactics" was that Germans are "orderly souls". A more valid reason may be that the welfare benefits in Germany, which can amount to more than two-third of a person's last net wage, are far more generous than in France.

However, what can be done about unemployment, the "Achilles' heel" of the German economy? First, the causes of the crisis have to be clearly identified. As regards the labour market and labour relations, the specific set of institutions that has been developed to steer the German labour market (whether it be labelled the "German" or "Social Democratic" model, "social market economy" or "Rhineland capitalism") seems no longer capable of adjusting to changing conditions and of achieving good labour market performance. Should this phenomenon turn out not to be only temporary, there may by a need for institutional changes. Second, policy recommendations to solve the crisis have to be developed and implemented. In Germany, Reformstau("reform jam") was chosen as the "word of the year" in 1997: in other words, the current constellation of power in the German political system seems to prevent many of the necessary reforms from being decided on, not to speak of implementation. For example, reforms of the tax and social security systems as well as further product market deregulation and the introduction of competition in regulated sectors are badly needed. Many of the reforms seem to be stuck in a jam. As regards the social partners, further wage restraint and more flexibility seem to be necessary for better labour market performance.

It is to be hoped that all actors involved will be successful in their fight against the German unemployment crisis. There are not yet any signs of social instability in Germany, though this may change. As the Economist put it: "No, the pudding will not explode - for the moment. But it would be unwise to assume it never will." (Stefan Zagelmeyer, IW)

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