Labour Market Regulation and Gendered Outcomes

At the end of the 1990s, the flexibilization of the German labour market was still considered modest. With respect to the standard employment relationship, consistently high dismissal protection was maintained with minor exceptions. However, the foundation was laid for subsequent flexibilization with respect to temporary work agencies and fixed-term contracts. The first Social Democratic/Green coalition introduced a policy of limiting flexibility, which included the reintroduction of full dismissal protection for employees in small enterprises. Marginal part-time employment was partly covered under social security. In 2001, a law on parttime work and temporary employment (Teilzeit- und Befristungsgesetz) was passed to restrict the use of fixed-term contracts and to increase the acceptance and facilitation of the switch from full-time to part-time employment (Eichhorst and Marx 2009b).

A turnaround towards activation and flexibilization became relevant when the so-called modernizers around Gerhard Schroder became influential within the Social Democratic Party (Dingeldey 2011). The so-called Hartz reforms consisted of four subsequent legislative acts advanced by the Commission for Modern Labour Market Services between 2002 and 2005. While all flexible forms of employment were deregulated, the (re) regulation of marginal part-time employment in the form of so-called ‘mini-jobs’ was crucial with respect to the family model and increased the lower earnings limit by up to 400 euros per month. It also abolished an existing working time limit (Eichhorst and Marx 2009b).

The reforms were backed by an economic upswing after 2005 and a rather brief downturn during the economic crisis in 2007-2008. Employment rates rose to 77 per cent of the working age population in 2011.[1] As the number of standard employees has remained constant, employment growth since 2004 seems to be strongly related to an increase in flexible employment. A gendered reflection of this development shows that male employment (all men of working age) grew slightly to 85 per cent in 2008, while employment of men holding a standard employment relationship increased to nearly 64 per cent. By 2011, the slight decrease was compensated for by a rise in flexible forms of employment. Labour market integration of women grew steadily in the period before 2005 but increased significantly after, rising to 73 per cent in 2011. However, the majority of women did not hold a standard employment relationship but were employed in non-standard employment forms. Nearly a third of all women had part-time employment liable to social security and about 5 per cent had a mini-job (see Fig.10.1).

The gendered distribution of employment forms is accompanied by an unequal distribution according to different sectors.[2] The standard employment relationship is still prevalent in male-dominated sectors like manufacturing and the construction industry and in services dominated by big enterprises such as banking and insurance. Even in IT services and consulting, the majority of employees hold a standard employment relationship (Eichhorst and Marx 2009a). These trends contrast with developments in other, mainly female-dominated services. The standard employment relationship has been crowded out by part-time employment in social and personal services. In education, other than part-time employment, fixed-term employment is most common. In hotel and catering more than a quarter of employees hold a marginal part-time job, and in cleaning more than half do, while the beauty business is characterized by a high share of solo self-employment (Eichhorst and Marx 2009a).

Labour market structures thus reflect the different stages of the female life course according to the dominant gender and family model. In 2010, full-time work was at 68 per cent among women without children and 29 per cent among mothers (with children younger than 18 years), whereas part-time work was at 32 and 71 per cent, respectively (Knittel et al. 2012). Thus, part-time employment became the standard form of employment for mothers.

A slight backlash against labour market flexibilization came under Conservative rule in 2011 when, for example, the re-employment of former employees as agency workers by the same employer was prohibited. This development was closely related to a campaign by the metal workers’ union to demand equal pay (Bispinck and Schulten 2011). In contrast, the attempt to hinder a further expansion of the marginal part-time limit to 450 euros per month in 2013 failed. This employment form remains highly attractive due to the payment of a lump-sum tax, and social security and liability allow married couples to maintain tax splitting advantages (Dingeldey 2001). At the same time, the various employment forms comply with employers’ demands for a flexible labour force (Arbeitgeberverbande 2013).

Altogether, the dualization of labour market regulation can be confirmed because the standard employment relationship is granted high social protection at the same time that flexible forms of employment have been deregulated and have therefore increased. This unequal protection, however, cannot be easily interpreted as a dualization of the labour market structure; rather, labour market regulation has developed a patchwork approach to flexibility that is highly gendered and varies according to sectors and branches (Eichhorst et al. 2015).

  • [1] The data source for the following numbers and Fig. 10.1 is the German Socio-Economic Panel(GSOEP). The calculations are based on working age population, excluding apprentices. Fixed-term part-time and part-time employees are summed up as part-time. Calculations were generouslyperformed by Tim Schroder.
  • [2] The following proportions of atypical employment are relatively higher than in figure 10 becausethey do not relate to persons of working age but only to employed persons.
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