Sustainable measures to stabilise labour markets during the crisis: the role of short-time work in Germany

In: Labour and sustainable development: north-south perspectives, S. 401-409

Abstract

"In the Federal Republic of Germany too, international speculation on financial and subprime markets coupled with the economic crisis has caused severe problems. Nevertheless, the spill-over-effects of the current crisis on labour markets have been mitigated by various initiatives and measures to combat unemployment, and especially by the implementation of short-time work. If short-time work is also implemented in those economic sectors (mechanical and electrical engineering, automotive industry etc.) which have to cope with empty order books, this might be a means of stabilising employment and labour markets in a sustainable way. We say that short-time employment is sustainable because (a) it safeguards jobs for workers and employees, and is backed by transfer payments from public employment services (short-time allowances) that secure an acceptable income level, and because (b) it can offer companies a secure supply of qualified and trained workers for the future. Furthermore, as a certain part of the wage costs remain in the company, these residual costs of short-time labour also offer a certain inducement to companies to renounce layoffs and bridge the crisis through temporary reductions of working hours. Thus it also offers a means of avoiding labour mobility and migration." (publisher's description)