Controversy over working time

In June 2003, Germany’s minister for the economy and work, Wolfgang Clement, sparked a debate on working time by saying that Germans should work longer hours in order to help the economy. The comment came at a time when metalworkers are taking strike action in eastern Germany to reduce their working week from 38 to 35 hours. Meanwhile, recent research indicates that the 35-hour week is not as widespread in Germany as is often thought, though another study finds that German workers have the shortest annual working hours in the industrialised world.

In June 2003, the Cologne Institute for Business Research (Institut der deutschen Wirtschaft, IW) published a report which finds that a 40-hour working week (or longer) is still a reality for 44% of all employees in eastern Germany. Moreover, only slightly more than one-fifth of all west German employees have a 35-hour week, while over half work 38 hours a week or more. The figures - see table 1 below - indicate that the 35-hour week is less common in Germany than is commonly thought.

Table 1. Weekly working hours of employees in Germany in 2002 (% of all employees)
Weekly working hours West East
35 to 35.9 31.8 0.3
36 to 36.9 3.5 0.7
37 to 37.9 21.6 3.1
38 to 38.9 36.0 31.4
39 to 39.9 14.1 20.8
40 2.7 43.7

Source: Cologne Institute for Business Research 2003.

Table 2 below sets out the IW figures for collectively agreed regular weekly working hours in different industries.

Table 2. Collectively agreed regular working weekly hours at the beginning of 2003
. West East
Private banking 39 39
Construction 39 39
Public service 38.5 40
Wholesale and foreign trade 38.5 39*
Insurance 38 38
Chemicals industry 37.5 40
Retail 37.5* 38
Textiles 37 40
Print 35 38
Metalworking and electrical industry 35 38

* Wholesaling and foreign trade - East Berlin 38.5 hours, Mecklenburg-Vorpommern 40 hours; retail - West Berlin 37 hours.

Source: Cologne Institute for Business Research 2003.

Annual hours and holidays

Despite the fact that agreed weekly hours are not as low as sometimes thought, a recent study by the Confederation of German Employers’ Associations (Bundesvereinigung der Deutschen Arbeitgeberverbände, BDA), based on figures provided by the European Commission, found that western Germany has the lowest average collectively agreed annual hours out of 19 industrialised countries examined, at 1,557 hours (1,685 hours in the east). Japan (1,955 hours), the USA (1,904) and Switzerland (1,844) have the highest average annual agreed hours.

In June 2003, members of the German Metalworkers' Union (Industriegewerkschaft Metall, IG Metall) in the metalworking and electrical industry are on strike in eastern Germany, demanding that their working week be reduced from 38 hours to the 35 hours worked by their colleagues in the west. However, on 18 June the minister of the economy and work, Wolfgang Clement, stated that German employees enjoy too much time off and should work longer hours if the country is to be rescued from recession. In 2003, a number of public holidays will fall on weekends, he pointed out, and as a result economic analysts estimate there will be increased growth of 0.5%. 'If you compare our calendar of public holidays with other countries, it is something that could make you start worry,' the minister said, and suggested cutting public holidays (TN0303103U) in order to spur economic growth by decreasing wage costs.

Reactions

Trade unions unsurprisingly reacted angrily to the minister’s suggestions that Germans should work longer hours. Klaus Zwickel, the resident of IG Metall), Germany’s largest industrial union, stated that 'not a single job will be created by the scrapping of holidays and public days off, or bringing in longer working hours.', Minister Clement has received support, however, from some quarters, including Dieter Phillip, the president of the Central Association of German Crafts (Zentralverband des deutschen Handwerks, ZDH) and Michael Rogowski, the head of the Confederation of German Industries (Bundesverband der Deutschen Industrie, BDI), who claimed that extending working hours might provide the impetus that the German economy needs.

Commentary

As the 35-hour working week for most employees in Germany is a myth, it is difficult for IG Metall to argue its case in favour of shorter working hours for eastern Germany. It is obvious that the introduction of the 35-hour week in the east cannot be justified by the example of western Germany, as the 35-hour week cannot be regarded as the rule in the west. More than one third of employees in western Germany have to work about 38 hours per week - ie they have to work as long as employees in the metalworking and electrical industry in the east. Therefore, it is questionable if a gap in justice exists, in particular as a reduction in working hours in eastern metalworking from 38 to 35 hours per week without loss of pay will most likely destroy jobs.

According to economic theory, compulsory reduction in working hours could create more employment only if pay and benefits were also cut - a move that would normally be opposed by most workers' representatives above the firm level. Fixed costs such as, for example, recruitment, training and extra office space mean that it costs more for firms to have large workforces. Hence, pay may have to be cut more than proportionally to avoid unit labour costs rising.

Therefore, it is helpful that the minister for the economy and work supports longer working time to improve the competitiveness of Germany's companies, even if this particular proposal will by no means solve the economy’s unemployment and economic growth problem alone. (Lothar Funk, Cologne Institute for Business Research)

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