The Heyday of Welfare States—A Window of Opportunity

Abstract

Two arguments are pursued in this chapter. The first and more familiar is that both the British and the German welfare states expanded dramatically from the mid-1940s until the 1970s. The two states provided welfare at the national level and the institution of the welfare state was seen as a sign of progress that brought about and arose from a mixture of positive economic, political and social conditions. Yet interestingly, neither state subsumed employee welfare. German health insurance schemes or British occupational pensions remained under the influence of companies. The second argument is that, through their expansion, the two welfare states consolidated employment as the main eligibility criterion for receiving welfare. The type of employment that took up a prominent position, however, was the Fordist type of lifelong, well-paid, skilled employment. This consolidation took place when welfare states began to address the risks facing this model such as reduced physical ability (through health care and pensions) and unemployment. In addition, the states had also become large employers by offering employment even more secure than the Fordist model (albeit with lower pay levels). In outcome, governmental welfare benefits outcompeted employee welfare benefits in the same areas. The chapter shows how the industrial employment model became ingrained in welfare systems and still affects contemporary institutions, while welfare aimed to render work available to the labour market.