Qualified, Educated ... Yet Lacking a Good Job

The days have taken on a numbing sameness for Reinhard Dilsner, 47, a barrel-chested German construction worker: Get up. Buy the paper. Check out the want ads. Swing by the government unemployment office. Pick up printouts of the latest vacancies. Go home. Start working the phone.

And every day come the same discouraging answers.

“Either they say I’m too old, or too big to run this or that type of machinery, or I’m overqualified,” he says. “I can’t get a job.”

He’s been out of regular work now for six years. By all logic, though, Dilsner ought to be up to his hard hat in job offers. Berlin, his home, boasts a nearly unbelievable 10,000 construction sites as it hastens to become the seat of the German government by 2000. Armies of workers are everywhere, putting up new office buildings, apartment blocks, subway stations, traffic underpasses--even a vast new central train station is to be built from scratch.

Dilsner has experience with a number of construction machines and has managed labor teams. He is a meister, or certified expert, of machine maintenance. He is qualified to remove asbestos, run a warehouse, secure dangerous underground building sites and train apprentices. With his burly physique, he looks as if he could lift a bulldozer as easily as drive it.

And yet here he sits, day after day, alone in an apartment where the phone never rings and the only sound is the bubbling of a fish tank. “It’s humiliating,” he says.

Welcome to the unhappy world of Germany’s “structurally unemployed.” In recent years, a new social class has grown up here: They are experienced, well-educated, eminently employable men and women--many in the prime of their lives--who labor experts say will never work again. They sit at home, they garden, they help care for grandchildren, they consult, they draw from this country’s increasingly overburdened social benefits pot. And they seethe with frustration.

“Anybody who gets laid off at 40 today is worthless,” says Lothar Wittrin, a 60-year-old construction worker who was forced out of his job and now collects special early-retirement benefits from the state.

“I became redundant after 38 years on the job, 29 of them at the same company,” he adds bitterly. “As a thank you, they gave me five marks for every year of work [or about $90]. You can spit on it.”

The latest unemployment rate in the land of the “economic miracle” is 11.7%, down a bit since February but still comparable to the street-fighting, scapegoating, anti-Semitic days of the early 1930s. The unofficial rate is even higher, taking in as it does people in make-work programs, early retirement programs, training courses and other state-led attempts to get people off the unemployment rolls.

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Modern Germany has changed, of course, and the class hatreds that led to the rise of Adolf Hitler are so deeply buried that they are hard to find. Progressive labor laws ensure a decent living standard for even the lowliest German workers. They have been key to cementing this country’s enviable social harmony.

Still, observers note with concern that more than a quarter of today’s unemployed have been out of work for more than a year and that each new economic downturn produces more long-term unemployed. Never has postwar Germany had to cope with so many people, with such high expectations, out of work for so long.

“There is no magic number” at which the tension becomes unbearable, psychologist Horst-Eberhard Richter says. “But I observe, in our country, a sense of yearning for authoritarian solutions. A lot of people think that the increasingly difficult problems can be managed only with authoritarian means, as if an open society can’t manage capitalism, and only a hard hand and an iron broom will work.”

And increasingly it is clear that the labor laws themselves have become part of the problem. So far, though, the coalition government of Chancellor Helmut Kohl has found it politically impossible to make changes.

Meanwhile, here and there, one can see signs of the strain on the face of this quiet, stable society: A union demonstration suddenly changes from a sedate, banner-laden parade to a vicious rock-throwing spree; a right-wing extremist opens fire on a left-wing bookstore; a bomb explodes at a bank that is financing a corporate takeover; mainstream politicians call for the exclusion of low-wage foreigners from the labor market.

“I really hope it doesn’t go on like this, because the mood in this country has really deteriorated,” Dilsner said. “The hostility toward foreigners has grown, and what is even worse is the malaise toward politics. People don’t even go to vote any more, or if they do, they vote for extremists, from either the right or the left.”

Where did the Reinhard Dilsners of this country come from?

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The root of their problem, economists agree, is the high costs associated with German labor, particularly in an increasingly global economy. German manufacturing labor is the costliest in the world when such employer-paid benefits as pension premiums are figured in, and in recent years the temptation for German businesses to create new jobs in cheaper places has been irresistible.

Atop the wage issue, regulations making it costly to lay workers off here are religiously enforced. These hard-won rules are a boon to those who already have jobs--but these days, they are making employers think long and hard before hiring any more Germans.

And now, with the end of the East Bloc, an army of well-educated, needy former Communists is standing just over a newly open border with Germany. Virtually overnight, workers here have been exposed to the same wage pressures that unions in the United States have long faced from Mexico and Central America.

Dilsner’s field, construction, presents a clear case study of all this.

Although contractors here aren’t supposed to bring in citizens of former East Bloc countries or other European nations and put them to work on the cheap, it happens every day in Berlin. Walk onto any of this city’s booming construction sites and it sounds likes a Babel of Portuguese, Russian, Polish, Serbo-Croatian or English with an Irish brogue.

Union leaders saw what was coming early on and began demanding restrictions on foreign labor. For almost two years, officials debated. Finally, they came up with a compromise: Workers from low-wage European Union countries such as Ireland and Portugal could come, but their bosses had to pay them the mark equivalent of about $10.60 an hour, plus room and board.

Sounds good--but construction workers say all the new regulation has done is drive down the German pay scale.

“The minimum wage has been like a boomerang that came back and hit us,” Wittrin said. “The unions wanted to set a minimum wage for foreigners, and now everybody has to get the minimum wage.”

Worse yet, as things have turned out, the minimum wage has done nothing to keep the other bargain-basement laborers from flocking in illegally from such non-European Union nations as Poland and Russia. They’ll work off the books for a fraction of the new minimum.

“The day before yesterday, the city did a raid on Potsdamer Platz,” Dilsner said, naming the biggest construction site in Berlin. “They found Poles working for three marks an hour,” or about $1.90--an unthinkable wage in Germany.

The Berlin Labor Office has a team of 140 inspectors who each day comb the city’s 10,000 construction sites, looking for off-the-books foreigners. Every day they find some, deport them and fine the subcontractors who gave them work.

But the subcontractors then go straight to court to file for bankruptcy, thus dodging the fines and freeing themselves to reincorporate under other names. They bring in new foreign crews and promptly get back to business. There’s nothing the Labor Office can do about it.

“We can never find anybody to collect the fines from,” says Peter Hielscher, a 19-year Labor Office veteran. “The companies know this. It’s like a roulette game, but it works well for them.”

But it is not just the huge wage disparities between Germans and foreigners that are fueling Germany’s structural unemployment. So are social customs, habits of mind, even seemingly progressive state policies--all of which are conspiring to keep the jobless on the dole.

The most pronounced of these may be the way unemployment insurance itself works here. The payouts aren’t that much more than those in U.S. unemployment compensation plans.

But the difference that really counts is this: German unemployment assistance can go on forever. The rationale lies with German history and a unique unwillingness here to make society’s weakest fend for themselves.

Consider: An unemployed American typically gets checks that amount to half of his most recent wages--the actual percentage varies from state to state--and the benefits generally end after six months.

But an unemployed German starts out with compensation of 60% to 63% of his most recent wages for a little more than two years at the outside--the duration depends on age, length of service and additional training courses taken.

Then, if he has exhausted those benefits and still doesn’t have a job, he qualifies for “unemployment assistance.” It pays 50% to 53% of his most recent wages and is open-ended. All workers must do is show, every three months, that they are still willing to work.

“Theoretically, you can get unemployment help for 30 years,” Hielscher admits. “It’s not unusual to find people in Germany receiving it for 10 or 12 years.”

Thus, for all the horror stories about the sink-or-swim American system, with former six-figure bank managers being forced to work as parking-lot attendants, the kinder, gentler German system turns out to have cruel side of its own: It warehouses the unemployed in a velvet fog of genteel poverty that, once they are in it, is nearly impossible to escape.

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Take Dilsner. Although he has been jobless since 1991, he has taken so many state-sponsored training courses since then that he still hasn’t exhausted his eligibility period for the initial type of unemployment compensation. He continues to receive 60% of his old wages, or about $1,200 per month. His wife, also unemployed, receives about $1,100.

Living on this money in a big, expensive city like Berlin isn’t fun, but the Dilsners aren’t starving, either.

The obvious problem is, under the standard German 35-hour work week, Dilsner’s $1,200 comes to about $8.50 per hour--much less than what he made when he was working, true, but still better than four times what those $1.90-an-hour Poles beavering away down on Potsdamer Platz earn. This is the calculation Dilsner must make every time he considers a new opening.

“This looks like more vacancies than it really is,” he says, holding up a handful of computer-printed slips from the Labor Office, each describing a job opening in Berlin. “It often happens that the pay is less than my unemployment compensation. And I can’t work for less than that. I’m already collecting so little.”

Also destructive are the rigid prevailing attitudes about work and education in Germany.

“This state was preaching for decades that a good education is the best prevention against unemployment,” the Labor Office’s Hielscher says. “Germany isn’t like the United States, where a lot of people get their training on the job. Here, people go to a lot of trouble to get qualifications before they enter the labor market, and they think they have a certain right to a job within their level of qualification.”

What this means today is that an unemployed German who takes a job beneath his official qualification level is gambling with the status he will need to get a better job once the economy improves.

“It sounds better in a job interview to say, ‘I’m trained in electronics but at present I’m unemployed,’ than to say, ‘I’m trained in electronics but at present I’m filling orders for a mail-order house,’ ” Hielscher explains.

The result: People stay on unemployment.

German policymakers aren’t blind to these unintended consequences--or to the pressures that the current 4.3 million jobless impose on the public purse. Bonn has been tinkering on the margins of its unemployment benefits system, raising the age at which people can apply for certain benefit categories and trying to make it harder for people to go on collecting if they reject jobs beneath their educational level.

“But it’s a rubber law,” Hielscher says. “It’s very hard to stop somebody’s benefits just because they refuse to take a job. We keep hoping that the economic system will get better so that we won’t have to take such draconian measures.”

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Not long ago, Dilsner says, he had his quarterly meeting with the caseworker handling his file at the Labor Office. They sat down to comb through her computer files. Say, why not take a special course to become an assistant construction-site leader? the caseworker asked Dilsner. The state would pay, and while he was in training he would be off the unemployment rolls.

But Dilsner had already worked as an assistant site leader, he reminded her, pulling out his resume. Why should he take a course on something he had already done?

Then how about a course in heavy machinery operation? she suggested, scrolling farther down the screen. Dilsner reminded her he had already taught young apprentices how to drive heavy machinery.

Finally the caseworker found something. In a couple of weeks, Dilsner will start a janitorial course.

“Sometimes, when I open the newspaper, I see that they’re looking for a janitor,” he says. “And if I call now, they won’t take me because I’m not qualified.”

He hands over a brochure from the janitorial school: “The janitors of today are true specialists!” it announces. “They are in short supply, and they earn a lot.” It goes on to list all the skills the aspiring janitors will study, everything from elevator maintenance to landlord-tenant law. The course lasts seven months.

Across town at Labor Office headquarters, Hielscher puts his hands over his face and laughs. “At the present,” he says, “we’re training so many janitors, maybe one out of 10 will ever get a job.”

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Jobless Germans

Unemployment is a persistent, growing problem not only for millions of German workers but also for Germany’s policy-makers. They have not found solutions for figures like these:

Unemployment rates, yearly ...

1991: 7.3%

1992: 8.5%

1993: 9.8%

1994: 10.6%

1995: 10.4%

1996: 11.5% (3,965,064)

Dec. 1996: 12.5%

Jan. 1997: 13.5%

Feb. 1997: 13.5% (4,671,908)

Note: The percentage of all registered Germans considered capable of employment--except those who are self-employed and soldiers--who were not working.

Source: German Federal Statistical Office