Is the Erosion Thesis Overblown? Evidence from the Orientation of Uncovered Employers

John Addison, Paulino Teixeira, Katalin Evers and Lutz Bellmann
Additional contact information
Katalin Evers: Institut für Arbeitsmarkt- und Berufsforschung, Bundesagentur für Arbeit
Lutz Bellmann: Friedrich-Alexander-Universität Erlangen-Nürnberg and Institut für Arbeitsmarkt- und Berufsforschung, Bundesagentur für Arbeit

No 2012-07, GEMF Working Papers from GEMF, Faculty of Economics, University of Coimbra

Abstract: It is sometimes claimed that the coverage of collective bargaining in Germany is considerably understated because of orientation, a process whereby uncovered firms profess to shadow the wages set under sectoral bargaining. Yet importantly, at a time when collective bargaining proper has been in retreat, little is known of corresponding trends in the frequency of indirect coverage, still less of the degree to which wages are aligned in practice. Using nationally representative data for 2000–2010, this paper charts the extent of orientation in the uncovered sector, and tracks average wages across bargaining regimes as well as changes in wages from switches in regime. It is reported that orientation is growing with the decline in sectoral bargaining and that orienting firms do pay higher wages than their counterparts in the collective bargaining free zone. Yet in neither case – frequency nor remuneration – is the degree of ‘compensation’ recorded other than partial.

Keywords: Orientation; Erosion of Collective Bargaining; Uncovered Sector; Sectoral Bargaining; Wages; Regime Shifts. (search for similar items in EconPapers)
JEL-codes: J31 J5 (search for similar items in EconPapers)
Pages: 36 pages
Date: 2012-06
New Economics Papers: this item is included in nep-bec, nep-lab, nep-lma and nep-ltv
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

Forthcoming in Industrial Relations.

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Working Paper: Is the Erosion Thesis Overblown? Evidence from the Orientation of Uncovered Employers (2012)
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