Has work-sharing worked in Germany?

Starting in 1985, (West) German unions began to reduce standard hours on an industry-by-industry basis, in an attempt to raise employment. Whether this "work-sharing" works is theoretically ambiguous. I exploit the cross-industry variation in standard hours reductions to examine their impact on actual hours worked, wages, and employment. Analysis of industry-level data suggests that "work-sharing" may have reduced employment in the period 1984-1994. Using individual data from the German Socio-Economic Panel, I substantiate the union claim of "full wage compensation:" the hourly wage rose enough to offset the decline in actual hours worked.