ABSTRACT
This chapter emphasizes important linkages between job and labour market structures, the type of skill and skill formation of the labour force, and the industrial relations system. Extensive standardized vocational training, regulated by law or collective bargaining, is seen as an important, though not exclusive, precondition for the development and prevalence of relatively homogeneous job and labour market structures in Germany compared to Japan or other developed industrial market economies. Hence, the German internal labour markets are different from internal labour markets in other countries which are primarily organized and shaped through extensive and rigid rules of internal worker allocation but less restriction on exit. Systematic worker versatility acquired through multiple and extended exposure to different work stations, goes a long way towards explaining the relatively high rates of productivity gains and the international competitiveness of both Japanese and German industry; a much discussed theme in recent years notably in Anglo-Saxon countries.
