Industrial Relations as a Source of Solidarity in Times of Welfare State Retrenchment

Abstract

Within the literature on retrenchment policies, the ‘solidarity-decline thesis’ is discussed. It is argued that current welfare state restructuring leads to a decrease in the actual social cohesion of society because redistributive public benefits are cut. The article addresses this thesis by presenting empirical evidence on social security based on collective bargaining. In Denmark, France, Germany and the Netherlands, collective agreements are increasingly used to regulate and finance social benefits. These collectively negotiated benefits may compensate to a certain degree for solidarity losses caused by retrenchment policies. The article reviews concepts of solidarity used in the literature and develops a two-dimensional scheme of four different concepts. The conclusion for comparative welfare state research is twofold. First, when viewing policies of welfare state retrenchment, the research should systematically include industrial relations in its frame of reference. Second, further studies should analyse the politics as well as the outcomes of collectively negotiated benefits more systematically. Under certain conditions, which are worth specifying, collective bargaining may lead to complex public–private mixes that shift welfare states in other directions than outright market liberalisation, not only in factual but also in normative terms.