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| Details |
| Case Code: CLIBE008 |
| Case Length: 3 pages |
| Period: -- |
| Pub Date: 2005 |
| Teaching Note: Not Available |
| Subject :Business Environment |
| Price:Rs.50 |
| Organization :-- |
| Industry :-- |
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Globalization and its affect on the German economy * |
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| This caselet explains the effect of globalization on the German economy, especially its labor market. It delves into the issues of job cuts and employee concern over job security. It details the reasons for the decline of the German economy. |
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Issues: |
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- Job cuts and reduced wages in German companies.
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- Is the economic turmoil a result of globalization?
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- Slow economic growth in Germany.
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| Introduction |
Globalization seems to have hit Germany, especially its labor market. Many automakers like General Motors (GM), Volkswagen, and DaimlerChrysler, have been hinting at reducing labor costs. On October 19, 2004, thousands of workers of GM in Germany marched through the streets of Russelsheim to protest the company's proposal to cut 12,000 jobs across Europe.
The US-based GM, had been incurring losses in its European operations since 2000 and its total losses were estimated at around $2 billion (1.6 billion euros). The firm, which has about 63,000 employees in 11 factories across Germany, the United Kingdom, Belgium, Poland, and some other countries, has been seriously contemplating cutting down its costs to make up for the losses.
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| Questions |
1. Do you think globalization is responsible for the present condition of the German economy? Explain.
2. Discuss the reasons for the slow economic growth in Germany.
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Keywords |
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General Motors (GM), Volkswagen, DaimlerChrysler, job security, Siemens, GDP, deutsche mark, EU limits, German economy, globalization
* This caselet is intended for use only in class discussions.
** More comprehensive case studies are priced at Rs.200 to Rs.700 (US $5 to US
$16) per copy.
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