Friday, July 12, 2013


The Marx and Engels Monument, Berlin 2011
The Britisch magazine The Economist of half June had a Special Germany Report*. Very interesting stuff to read even if you take in account that The Economist is one of the leading promotors of neo-liberal thinking. If you as a trade unionist want to know, what your opponents think it is therefore perhaps especially wise to read the Economist. One of the interesting parts of The Special Report is the one called “the working parts”. It is about those characteristics that explain why Germany is not doing so bad during this European crisis. Another reason to read The Special Report.

One very interesting question especially for trade unionists, is why Germany has such a favourable employment record? “A decade ago Germany had one of the worst jobless rates in the rich world. Today its employment rate of 5,4% (using OECD figures) is one of the lowest in Europe. Youh unemployment, below 8%, is half that in America and a third of the European average. It is also the lowest Germany has een for 20 years.”

According to The Economist's Special Report this is not the result of booming growth. “Over the last decade Germany's economy has on average grown more slowly than American's and Britain's and barely faster than that of the euro zone as a whole. But Germany managed to avoid a surge of lay-offs after the financial crisis and has done far better than others at getting the young and the hard-to-employ into work.”

The Economist wonders how Germany did manage that? “Most explanations heap praise on the Mittelstand model and the system of vocational training. Firms take on apprentices, mixing practical training with classroom tuition. The German Government also points out that the country “did its homework”, introducing tough labour reforms from 2003 (known as 'Agenda 2010') that freed up the labour market. And the system of Mitbestimmung (which gives trade unions seats on company boards) encouraged wage restraint.”

But for the Economist this explanation is not sufficient: “a cheap currency, some dumb luck ( this sounds irrational especially for the neo-liberal Economist) and a fair amount of fiscal pragmatism also played a part.(....) Shocked by high joblessness and the hollowing out of German industry, the Social Democratic Government under Gerard Schröder introduced a set of sweeping tax, regulatory and labour reforms in 2003. The most important part of this package were the so-called Hartz reforms ( after Peter Hartz, who headed the commission that drew them up), which brought fundamental changes to the low end of the German job market. They eliminated payroll taxes on earnings of less than € 400 a month (recently raised to € 450 ), thus encouraging the creation of part-time 'mini-jobs'. “

The Economist finds that these 'mini-jobs' brought back into work the long-term jobless and gave employers an incentive to create low-skilled and temporary jobs and the jobless a reason to take them. “The also made Germany more Anglo-Saxon. Some 20% of Germans now work in “low-wage” jobs, about the same share as in Britain, not much lower than in America and almost twice as much as in France. Germany's employment boom had less to do with the Mittelstand than with this overhaul at the bottom, which pulled a lot of low-skilled people into work – though it also exerted a downward pull on overall productivity.”

The reforms had also what the Economist calls “big knock-on effects.”: “In conjunction with a move east by many German firms, they persuaded Germany's unions to accept years of tight wage restraint. Between 2001 and 2010 German wages rose by an average of just 1,1% a year in nominal terms, leaving them flat in real terms. Unit labour costs fell sharply relative to those in other countries.”

* The Economist, The Reluctant Hegemony, Special Report Germany, June 15th – 21st 2013, page 12.

Friday, July 5, 2013


Drinking a coffee and exchange information and experience during the iLO Conference. From left to right Martijn Hordijk, CNV representative for the Netherlands, Brorn van Heusden, WOW executive secretary, Bert van Caelenbergh, EUROFEDOP secretray general and Koffi Chrysanthe Zounnadjala, WOW Vice President, FPE secretary general, FENET secretary general Togo and deputy secretary CSTT Togo.

The question is how and what do you report about a Conference like the ILO Conference, held as usual in Geneva in the month of June, where nearly 5000 representatives discuss in several committees specific items, where there are daily meetings of the workers, employers and governments and where are held regularly plenary sessions? Without wishing to be without respect, I sometimes feel as being in a kind of circus with too many circus rings so I do not know where to look. May be the most important and interesting aspect of the ILO Conference is the opportunity to meet so many people from so many different corners of the world.

The following three partite committees (workers, employers and governments) were at work during the Conference: the Committe on Sustainable development, decent Work and 'Green Jobs', the Committee on Employment and Social Protection in the New Demographic Context (aging society), the Committee for the Recurrent Discussion on Social Dialogue and the usual Committee on the Application of Conventions and Recommendations that examined this year 26 countries.The ILO Director General presented two reports for debate: “Towards the ILO centenary: Realities, Renewal and Tripartite commitment” and “The situation of workers of the occupied Arab territories.” The observations and conclusions from each Committee as well as the results of the debates on the ILO Director's Reports have been published on the ILO website.

WOW executive secretary Bjorn van Heusden meets during the ILO Conference ILO Actrav staff member Amrita Sietaram.
The most 'political' Committee is the one on the Application of Conventions and Recommendations. The Conference examined 25 individual cases of problems in the application of labour rights and one case of progress (Miyanmar). The 25 cases concern the following countries: Bangladesh, Belarus, Cambodia, Canada, Chad, Dominican Republic, Egypt, Fiji, Greece, Guatemala, Honduras, Islamic Republic of Iran, Kenya, Republic of Korea, Malaysia, Mauritania, Pakistan, Paraguay, Saudi Arabia, Senegal, Spain, Swaziland, Turkey, Uzbekistan and Zimbabwe.The Committee drew special attention to three cases: Belarus, Fiji and Uzbekistan.

The other important topics of this year were the social dialogue, 'green jobs' and aging society. On paper, all Member States of the ILO endorse the importance of social dialogue. That this is not always the case in practice, is to be expected in undemocratic countries. But for example, there are EU countries in South and Eastern Europe, that due to the crisis do not respect anymore the social dialogue. Countries with emerging economies, particularly in Latin America, see the crisis as an opportunity to strengthen the social dialogue. Especially in established economies, the social dialogue is under attack. The ILO calls this global trend a race to the middle.

WOW vice president Koffi Crysanthe Zounnadjala (in the middle between 2 colleagues) is also the WOW coordinator of WOW delegates to the ILO Conference.
The trend that companies are increasingly less bound by national borders, is continuing. Production often stretches out over several countries. That makes companies also responsible to respect the labor conventions in the international 'production chain' and not only in the country where their headquarters stands. The ILO intends to cooperate more directly with multinational corporations and trade unions. This enables companies and their suppliers to establish the same labour standards in different countries. To ensure compliance with these standards, it is necessary to support the creation of a good system of control. The ILO should therefore do more research and develop more activities about this globalization of production.

An important outcome of the discussion in the Committee on Social Dialogue is that the ILO will focus more on the sustainability of international production chains. A decision that undoubtedly is linked to the recent disaster in Bangladesh.The impact of the flexibilisation of the labor market on the social dialogue and on collective bargaining were also subject of discussion.

This topic is also clearly reflected in the agenda for the future presented by the ILO Director General Guy Ryder on the eve of the conference. He stressed that the ILO will engage in discussions about the changing world of labour(flexibility). At the end of the Conference he said that “a forward-looking examination of the place of work in our lives and societies is needed. It will frame policy choices and it will be appropriate to the marking of the ILO’s 100th anniversary.” He added to this, that “there was widespread interest in defining and implementing an ILO role in respect of global supply chains and more generally in respect of corporate social responsibility.”

For this blog I used texts of the blogs produced by Martijn Hordijk from CNV Netherlands and who was the official workers' representative in the Dutch delegation.