Labour market flexibility: Are the reforms points in the right direction?

Changes in the working world call for new labour market regulations. For Dr. Ursula Engelen-Kefer, deputy chairperson of the DGB (German Labour Union Federation) the reforms that the government has implemented and plans to implement are pointed in the right direction: "We do not expect that job creation will be hindered, nor do we expect the competitive situation of firms to worsen such that they will be forced to reduce jobs." Dietmar Heise, managing director of the BDA (Federation of German Employers) fears that the government's reform package will lead to "a further inflexibility in the labour market and to a solidification of the high rate of hard-core employment". Prof. Norbert Berthold of the University of Würzburg argues for clear deregulation of the labour market. Prof. Jürgen Kromphardt of the Technical University of Berlin and member of the German Council of Economic Advisors doubts that "deregulation of the labour market will have positive effects on employment. To achieve higher employment, more demand for labour from improved demand for goods and services is necessary as well as a more even distribution of work between job holders and job seekers."