Home » Verdi, GDL, farmers: The consequences of the German “permanent strike”

Verdi, GDL, farmers: The consequences of the German “permanent strike”

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Verdi, GDL, farmers: The consequences of the German “permanent strike”

The demands are diverse: more wages, less working hours, better conditions. This often means a strike, and not just for train drivers. The Verdi union has just called for the next action. This time local buses and trains will remain at a standstill.

Flight crews, train drivers, farmers and freight forwarders had previously protested. Sometimes with major restrictions for the public – and so far almost always without any significant progress in collective bargaining.

The many actions by trade unions and interest groups also raise economic questions for Germany. Costs, salaries, consumption – experts provide answers to the most important questions.

How much does a strike cost?

The costs cannot be quantified precisely because the exact consequences are difficult to understand, even for experts. Sebastian Dullien, scientific director for macroeconomics and economic research at the trade union-affiliated Hans Böckler Foundation, estimates the costs for taxpayers and companies to be low.

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“Past experience is that limited strikes in Germany have no overall economic consequences,” says the economist. Companies would usually make up for the lost production in special shifts when work goes back to normal. “When it comes to services, other companies often step in,” says Dullien: “If the train drivers go on strike, more flights are flown.”

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Age of labor disputes

Especially when it comes to the consequences of longer strikes by the train drivers’ union GDL for the economy as a whole, the German Economic Institute (IW) assesses it differently: If strikes last three days or longer, “experience from previous GDL strikes shows that the daily damage can be up to 100 “can be millions of euros,” says an IW report from 2021.

Deutsche Bahn estimated the damage to the company in the current collective bargaining dispute at 25 million euros per day of strike. And: the unions also have costs. They pay striking employees a meal allowance of around 70 euros per day. However, these are negligible. They are covered by membership fees.

Is the protest actually good for the economy?

This view is represented by the IG Metall union, which fundamentally sees collective bargaining as an “important contribution to reliable future prospects for companies and employees and the economy”.

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But it is also a fact: in many cases there have been no deals for months. In the case of the GDL, the union broke off the talks without any results; in the current Verdi strike, the Berlin transport company rejected new collective bargaining. The strike continues.

Michael Fratzscher, President of the German Institute for Economic Research (DIW), is therefore skeptical about the development: “All too often, citizens are the biggest losers. A strike is ultimately an admission that social partnerships don’t work.”

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At least the expert sees no danger of a wage-price spiral, which could lead to a further increase in inflation. “The danger is low. Unlike in the 1970s, wages today are no longer linked to inflation.”

Marc Tenbieg from the German Mittelstands-Bund (DMB) points to existing problems in Germany: “It is forgotten that the German economy is currently not in a good overall condition.” The high demands of the unions therefore put employers under disproportionate pressure and could even lead to job cuts.

Is Germany now becoming a strike country?

In a global comparison of strike frequency, the Germans are traditionally in the middle of the field. The ten-year average fell from 2012 to 2021 In Germany, 18 working days per 1,000 employees are caused by strikes. For comparison: in the statistics, Belgium takes the top spot with 96 days lost, followed by Denmark (53), Spain (48), Norway (42) and the Netherlands (22).

So Germany is not yet a strike country. However, the Verdi union tells WELT that a “further expansion of the strikes” would be conceivable if there is “no progress” in the negotiations.

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DIW economist Fratzscher estimates the unions’ sphere of influence to be rather small compared to previous years. “Only a good half of all jobs in Germany are covered by collective agreements,” said the expert. Nevertheless, from his point of view, strikes in Germany could increase. “We will see more frequent strikes and wages will also rise significantly to catch up with inflation.”

Should I also negotiate my salary now?

“The best time to negotiate your salary is when there are good reasons for it. The strike of others is not a good reason,” says expert Jochen Mai from the job advice platform Career Bible. More effective arguments for more money are better performance, more responsibility or a higher market value after further training.

At the same time, Mai considers the fact that the unions argue that they want to make professional fields more attractive to be “extremely clever”. “But it’s still about the strikers’ own salary and their own working conditions.” According to Mai, we can learn from the actions of the unions: “Self-confidence always pays off in negotiations. But only in connection with substance.”

How did the strike change consumption?

An influence can hardly be proven, even if industry associations suggest it. When asked by WELT, the Association of Organic Food Manufacturers (AÖL) writes: “When people take to the streets, it creates awareness among the population.” This also applies to the farmers’ protests: “People are craving good food again, and the protests have definitely contributed to that.”

However, the increase in sales has been observed since 2019. According to Bioland, sales of organic food have increased by 47 percent in the past four years. A connection between rail strikes and the use of other means of transport can only be assumed.

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According to an online survey by the opinion research institute YouGov on behalf of the German Press Agency, 32 percent of the 413 participants said they would switch to other means of transport because of the rail strikes at the beginning of the year. The ADAC automobile club sees cars in particular as an advantage: “If there is no train service, there is often no alternative to the car,” said a spokesman. In the survey, 32 percent also stated that they would forego leisure appointments because of strikes, and 24 percent canceled work appointments.

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What do the strikes mean for “Made in Germany”?

The right to strike is enshrined in the Basic Law and has therefore long been part of the German working world. Nevertheless, industry associations such as the DMB see the risk of further disruption in Germany’s already tense economic situation.

“So far there has been no major loss of trust in German companies,” says Marc Tenbieg, managing director of DMB. However, he believes that far-reaching demands from employees could change that. “The current wave represents an unusual challenge,” says Tenbieg: “It ultimately damages the reputation of Germany as a business location and the competitiveness of companies.”

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