EMPLOYERS ASSOCIATIONS AND LABOR MARKET POLICIES IN GERMANY AND ITALY

To what extent did globalization generate uniform employers' pressures for employment protection deregulation and welfare state retrenchment? Which institutional arrangements did employers support and how did they influence policy-making processes in comparative perspective? This work answers these questions by investigating the positions of peak employers associations in Germany and Italy with respect to the reform processes of employment protection legislation and unemployment insurance systems between 1990 and 2008. Building on a theoretical distinction of the policy preferences of different employers groups in postindustrial economies, this research finds that relevant intra-business divides emerged during key reform events mainly between employers in small firms and in the low-productivity sectors and core manufacturing producers. In both countries, the point of contention was not whether to change inherited 'industrial' institutions but rather how to change them. Everywhere, small-firm employers struggled to gain as low levels of job protection and contribution rates to unemployment insurance as possible, whereas core producers indeed tended to advocate for more moderate adjustments. Research findings emphasize the growing influence of small business demands as a consequence of postindustrial economic-structural changes, and suggests that dual reform outputs are intrinsically associated with the development of service-based economies. Two variables are however found shaping different policy arrangements mainly with respect to dismissal protection and unemployment insurance systems in Germany and Italy. On one side, the distributional outcomes of industrial policy structures spurred stronger discontentment with existing labor market institutions among German small-firm employers than among Italian employers. On the other hand, different peak associational systems were conducive to different capacities of employers to organize collective action. An encompassing system facilitated intra-business coordination and the predominance of a 'logic of influence' vis-à-vis other actors in Germany. By contrast, a fragmented associational system incentivized competing positions between different business segments in Italy and oriented them to pursue particularistic reform objectives, consistently with a 'logic of membership'.