The Limits of Numerical Flexibility: Continuity and Change

Abstract

Abstract In recent years, the European social employment model has come under increasing scrutiny for its relative inability, compared to its Anglo-Saxon counterpart, to generate sustained employment growth. The problem, for critics, has been that the European model provides too much employment security leading to too little numerical flexibility for employers to make adjustments to the size of their workforces. This criticism has not only come from outside Europe, but increasingly from within. In Germany, the challenge to rigid labor markets has come from the business lobby—now wishing to be freed, post-reuniflcation, from the constraints that had previously provided a useful institutional constraint on labor. This has found its way into the political arena. The 2005 general election was fought not on whether the government needed to dismantle established labor market rigidities; but at what speed. It seems likely that in France too, populist sentiment among elements within the Gaulist right, backed by business interests, may be preparing to challenge the fabled French social model, so long a focus of party consensus.