A Difficult Labor

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Ever since the wirtschaftswunder of the 1950s, labor unions have played a crucial role in Germany. By law, union members sat on company boards, contracts were negotiated with a "consensus" approach that avoided the kind of labor unrest that afflicts France and Italy, and unions exerted considerable political influence. But German union power is now showing real signs of fading. More than 30% of Germany's union members have stopped paying dues in the last decade because of unemployment and disenchantment with unions; even the labor-friendly government of Chancellor Gerhard Schröder often ignores their political suggestions; and last week, after the powerful IG Metall engineering union suffered a humiliating defeat in a monthlong strike in eastern Germany, its chairman Klaus Zwickel resigned three months earlier than anticipated. "It's the worst crisis for the union since World War II," says Uwe Hück, head of the works council at carmaker Porsche. "The leadership has lost touch with reality."

The apparent weakness of German labor comes at a time when French unions have recently shown remarkable solidarity, shutting down Parisian streets for several days this spring. And last week, British Airways workers on an unofficial strike turned Heathrow Airport into a holiday hell. To protest the introduction of a new electronic time-card system, staff failed to show up, leaving 80,000 customers stranded and more than 400 flights canceled.

No such enthusiasm among Germany's workers. Zwickel used his resignation to protest the future militant course of the union under his chosen successor, Jürgen Peters. Peters is known as a hard-liner in contract negotiations at a time when moderates would prefer a consensus approach. "Many members and functionaries, many people of trust, will not agree to this death-defying leap," Zwickel said. At the same time, Schröder's government reached a compromise agreement with the conservative opposition on a wide-ranging reform of the nation's health-care system, putting more of the financial burden on employees, and showing just how impotent the unions have become.

Despite being Europe's largest engineering union, IG Metall has been in trouble for some time. In the last decade, its membership has fallen by 809,000 to 2.6 million, almost a 25% drop. In just the first half of this year, the union lost 46,912 members, more than in the whole of last year. The union's current troubles stem from strikes in June at car-production facilities in eastern Germany. IG Metall called the strike to force employers to reduce working hours from 38 to 35 hours a week, making them equal to workers in western Germany. But employers like Volkswagen and DaimlerChrysler refused to budge. Instead, they closed plants in western Germany because of the shortage of parts made by the factories in the east.

As the car factories closed down, the union's popularity plummeted. In unprecedented scenes, workers began crossing picket lines to go back to work — they were more concerned about losing their jobs than about working less. Some workers even crawled under a fence to get back to the factory. As a result of this failed strategy, half of all Germans now believe that unions impede economic recovery, according to a poll for the German press agency DPA. Only 55% said they believe that unions have a future.

"It's clear that the political power and influence of trade unions is really cut down," says Reinhard Bispinck, an expert in collective bargaining at the Institute for Social and Economic Research in Düsseldorf, part of the giant D.G.B. union federation. Schröder's economic reform plans are a case in point; even though two-thirds of his Social Democratic Party in the Bundestag are union members, they overwhelmingly voted for the reform package, which cuts unemployment benefits and makes it easier to fire employees. The D.G.B. union federation was left sputtering about a "hot autumn" of protests.

Some unions are already willing to compromise. The public-service union Verdi recently agreed with the City of Berlin to cut the workweek and receive a no-firing guarantee for five years in exchange for a 12% reduction in pay. Deutsche Post reached a wage deal allowing the company to pay new hires less than workers already on the job, which should allow D.P. to increase its staff. Even Peters, the incoming chairman of IG Metall, once agreed to a wage cut at Volkswagen in exchange for a reduced workweek. He'll need that kind of flexibility again if he wants to regain some of the union's lost clout.