Exit Bismarck, Enter Dualism? Assessing Contemporary German Labour Market Policy

Abstract

Between 2003 and 2005, German labour market policy was subjected to the most far-reaching reform since the 1960s. Some commentators have interpreted the changes introduced as signalling a departure from the traditional ‘Bismarckian’ paradigm in German social policy. For others, the new legislation has contributed and consolidated an ever-more pervasive trend of dualisation within the German welfare state. In this article, we contest both interpretations. First, we demonstrate that traditional social insurance principles remain a dominant element within unemployment protection. Second, we show that German labour market policy is less rather than more segmented today than it was a decade ago.

Practices of activation in frontline interactions: Coercion, persuasion, and the role of trust in activation policies in Germany

“…Unemployment insurance traditionally rests on the principle of status protection, reflected by benefits which are proportional to previous earnings and employment integration in accordance with qualifications and work experience. Also, in the post‐reform system of social security, the insurance principle remains a significant element of unemployment support in Germany (Clasen & Goerne, , p. 801). Nonetheless, incremental policy changes have, overall, weakened the principle of status protection (Betzelt & Bothfeld, ; Bothfeld & Rosenthal, ).…”

Benefit dependency: The pros and cons of using “caseload” data for national and international comparisons

“…One reason for the paucity of comprehensive national data on claimant numbers is certainly the complexity of national social security arrangements, with distinctive benefit programmes at times catering for the same needs and similar social groups. Some governments have begun to address this problem by combining what are functionally similar systems, as in Germany for example, where the so‐called Arbeitslosengeld II (unemployment benefit – UB II) has been created as a basic income security scheme for all employable persons outside of unemployment insurance (Clasen and Goerne, ). The United Kingdom is in the process of merging several programmes within the forthcoming Universal Credit, which is heralded as a “single working‐age benefit system”, even though this is to some extent a misnomer since parallel programmes, such as contributory unemployment and disability transfers, will remain in place.…”

“…In Belgium early retirement and sabbatical leave systems are part of the unemployment insurance system (and hence form a considerable part of this expenditure category in the OECD's Socx database or Eurostat's ESSPROS database ). In Germany, unemployment assistance (UB II) can be claimed not only by those who are registered as unemployed but by those who are “employable”, even in a minor capacity, as well as those in low‐paid work (Clasen and Goerne, ).…”

“…Plotting trends separately Figure , Panel B, indicates that means‐tested unemployment assistance became increasingly important during the 1990s to the extent that overall unemployment protection in Germany became increasingly “dualized” in terms of caseload numbers, or rather heterogeneous if unemployed social assistance claimants are included (see Clasen and Goerne, ). However, in 2005 this changed fundamentally when, in the context of the most important reform in German labour market policy since the 1960s, unemployment benefit provision was administratively and institutionally reformed.…”

The Rise of Precarious Employment in Germany

“…At the same time, the heightened conditionality of welfare benefits raised the pressure on jobseekers to accept "bad" job offers and contributed to an increase in precarious employment (Clasen and Goerne, 2011;Eichhorst and Marx, 2011;Streeck, 2009). Unions fiercely opposed these reforms, and therefore, the implementation of the reforms may have further weakened unions' role in German political economy (Streeck, 2009).…”