Globalisation’s assault on the labour market: a German perspective

Abstract

In the 1980s, globalisation was much vaunted as offering the Western world a dazzling new array of business opportunities. In the 1990s, however, the negative impact on the labour market has become all too evident. A look at Germany’s labour statistics shows a frightening picture of massive job destruction in the wake of globalisation. As firms contend with heightened international competition and incomparably low wages in the former Eastern bloc and Asia, they have turned almost ubiquitously to cost‐cutting through shedding labour inside Germany itself. Jobs either disappear altogether or are relocated. Karl Marx’s predictions about capitalism are eventuating in a process by which firms become ever more profitable, but at a cost of large‐scale unemployment. Through computerisation, strategic alliances, the manipulation of trade unions and so on, the process of rationalisation and wage reduction proceeds at an alarming pace. If grave social consequences are to be averted, the problem needs to be tackled on several fronts simultaneously. Attitudinal changes on the part of both management and workers, a modified taxation regime, better public relations about Germany as an industrial location and various other strategies offer some hope to a country that is clearly undergoing a globalisation crisis.

Citation

Bloch, B. (1998), "Globalisation’s assault on the labour market: a German perspective", European Business Review, Vol. 98 No. 1, pp. 13-24. https://doi.org/10.1108/09555349810195510