Still Seeking Coordination? Assessing German Employers’ Interests in the Digitalized Social Market Economy

Abstract

Do German employers in metal and electrical (M+E) sector still want to support core institutions of a coordinated market economy, and are capable of doing so? Based on evidence collected in a series of expert interviews conducted in 2017 and 2018 with employers’ associations, we argue that social partnership, collective bargaining, and strategic coordination via organizations are still part of the preferred modus operandi of these employers. Moreover, we argue that new forms of associational membership that enable firm-based, yet often collective, solutions, which have stabilized rather than eroded the organizational capacity of employers’ associations. As such, we provide supportive evidence for several core premises associated with the Varieties of Capitalism approach. Yet we also identify trends toward more flexibilization, decentralization, and systemic volatility in this system, as many small and medium-sized enterprises, especially in East Germany, remain without any associational membership.

Membership in employers’ associations and collective bargaining coverage in Germany

“…Employers' associations (EAs) represent the labor-market interests of firms (Behrens, 2016(Behrens, , 2018Demougin et al, 2018;Jacobi and Sadowski, 1991;Silvia, 2013;Silvia and Schroeder, 2007;Weckwerth and Weishaupt, 2019). Compared to EAs in other European countries, a unique feature of German EAs is that they are 'pure' associations solely representing labor market-related interests.…”

“…They also provide opportunities for direct communication among members. For example, an EA may implement circles in which HR or production managers of different firms regularly meet to discuss specific topics (Weckwerth and Weishaupt, 2019).…”

“…Such networking also offers opportunities to managers for socializing. Case study evidence suggests that managers value EAs as platforms for their local social life (Weckwerth and Weishaupt, 2019). Membership in an EA may be viewed similar to the membership in a golf club, Rotary Club or Lions Club.…”