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From the Dual Apprenticeship System to a Dual Labor Market? The German High-Skill Equilibrium and the Service Economy

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  • Eichhorst, Werner

    (IZA)

  • Marx, Paul

    (University of Bonn)

Abstract

Different models of protection against labor market risks are associated with diverging models of economic performance. Historically established institutional complementarities between labor market regulation, unemployment protection, and vocational training tend to mirror specific national models of economic production. For example, the German dual apprenticeship system is a core feature of the corporatist model of "diversified quality production". This, in turn, is supported via skills-protecting, earnings-related unemployment insurance, skills-oriented active labor market policies and strong dismissal protection so that long-term productive employment relationships become viable. The paper explores the connection between structural change and the development of skill creation in the German case with a particular focus on the difference between manufacturing and services as well as between different types of service sub-sectors. The paper takes manufacturing, a sector dominated by standard employment, as a reference point but mainly addresses different segments of the service economy: traditional ones (banking and insurance), new high-skill sectors (IT and the "creative economy") and growing areas of low-skill services (hotels and restaurants, cleaning). We find that dynamic job creation in these segments of the service sector was possible due to a less regulated institutional environment.

Suggested Citation

  • Eichhorst, Werner & Marx, Paul, 2009. "From the Dual Apprenticeship System to a Dual Labor Market? The German High-Skill Equilibrium and the Service Economy," IZA Discussion Papers 4220, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp4220
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    References listed on IDEAS

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    7. Eichhorst, Werner & Marx, Paul, 2009. "Reforming German Labor Market Institutions: A Dual Path to Flexibility," IZA Discussion Papers 4100, Institute of Labor Economics (IZA).
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    11. Marco Mundelius, 2009. "Einkommen in der Berliner Kreativbranche: angestellte Künstler verdienen am besten," DIW Wochenbericht, DIW Berlin, German Institute for Economic Research, vol. 76(9), pages 138-143.
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    Cited by:

    1. Vera Šćepanović & Antonio Martín Artiles, 2020. "Dual training in Europe: a policy fad or a policy turn?," Transfer: European Review of Labour and Research, , vol. 26(1), pages 15-26, February.
    2. Konle-Seidl, Regina, 2010. "Make further vocational training pay : possibilities and limits of promoting transitions by Public Employment Services (PES)," IAB-Discussion Paper 201018, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    3. Werner Eichhorst & Michael J. Kendzia, 2016. "Workforce segmentation in Germany: from the founding era to the present time [Die Segmentierung der Belegschaft in Deutschland: von der Gründerzeit bis heute]," Journal for Labour Market Research, Springer;Institute for Employment Research/ Institut für Arbeitsmarkt- und Berufsforschung (IAB), vol. 49(4), pages 297-315, December.
    4. Niccolo Durazzi, 2023. "Engineering the expansion of higher education: High skills, advanced manufacturing, and the knowledge economy," Regulation & Governance, John Wiley & Sons, vol. 17(1), pages 121-141, January.
    5. Dingeldey, Irene & Kathmann, Till, 2017. "Einführung und Wirkmächtigkeit des gesetzlichen Mindestlohns in Deutschland: Institutionelle Reformen und gewerkschaftliche Strategien in einem segmentierten Tarifsystem," Schriftenreihe Institut Arbeit und Wirtschaft 21/2017, Institut Arbeit und Wirtschaft (IAW), Universität Bremen und Arbeitnehmerkammer Bremen.
    6. Indermit Gill & Johannes Koettl & Truman Packard, 2013. "Full employment: a distant dream for Europe," IZA Journal of European Labor Studies, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 2(1), pages 1-34, December.
    7. Kellermann, Kim Leonie, 2017. "Minimum wages and vocational training incentives in Germany," CIW Discussion Papers 3/2017, University of Münster, Center for Interdisciplinary Economics (CIW).

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    More about this item

    Keywords

    service sector; Germany; dual labor market; low-skilled work; atypical employment;
    All these keywords.

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J44 - Labor and Demographic Economics - - Particular Labor Markets - - - Professional Labor Markets and Occupations
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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