That's the view of Thomas Geoghegan, who is a very labor-friendly and Europe-friendly American writer (in fact he is a former labor lawyer):

German unions have had to keep wages down of late. But that's at least in part because in the early 1990s they pushed them up too high, even by my left-of-center standards.

But your point is well-taken, as I tried to indicate in the diary: eventually the strategy of growth through increased worker insecurity and labor cost reductions is self-defeating, as it helps destroy the very consumer confidence that is needed for long-term recovery.