Wage and Workforce Adjustments in the Economic Crisis in Germany and the Netherlands

TitleWage and Workforce Adjustments in the Economic Crisis in Germany and the Netherlands
Publication TypeJournal Article
Year of Publication2014
AuthorsTijdens, Kea, van Klaveren, Maarten, Bispinck, Reinhard, Dribbusch, Heiner, and Öz, Fikret
JournalEuropean Journal of Industrial Relations
Volume20
Issue2
Pagination165 - 183
Keywordscollective agreements, economic crisis, Germany, industrial relations, labor hoarding, Netherlands, workforce adjustments
Abstract

This study uses data from a continuous employee web-survey to investigate the trade-off between wage and workforce adjustments and the role of industrial relations in firm-level responses to the economic crisis in Germany and the Netherlands. Workforce adjustments seemed to be a continuous organizational strategy, but wage adjustments were less often reported. We found no large-scale evidence of wage concessions being traded-off for job protection in the two countries. Collective bargaining ensured that wage-setting was more robust than employment protection: employees covered by collective agreements reported workforce adjustments more often than wage adjustments. Low-educated and low-wage employees reported basic wage reductions more often: the economic crisis increased wage inequality. Labor hoarding was reported predominantly by young, male employees with a permanent, full-time contract.