Documents Gehrke, Britta 11 results

"Short-time work is a labor market policy that subsidizes working time reductions among firms in financial difficulty in order to prevent layoffs and stabilize employment. Many OECD countries have used this policy in the Great Recession, for example. This paper shows that the effects of discretionary short-time work are strongly time dependent and non-linear over the business cycle: it may save up to 0.8 jobs per short-time worker in deep economic crises. In contrast, in normal times and expansions, the effects are smaller and may even turn negative. Our results demonstrate that the policy becomes more efficient as the recession deepens. We disentangle discretionary short-time work from automatic stabilization in German data and estimate time-varying employment effects using a smooth transition VAR."

"Working time accounts (WTAs) allow firms to smooth hours worked over time. This paper analyzes whether this increase in flexibility has also affected how firms adjust employment in Germany. Using a rich microeconomic dataset, we show that firms with WTAs show a similar separation and hiring behavior in response to revenue changes as firms without WTAs. One possible explanation is that firms without WTAs used short-time work instead to adjust hours worked. However, we find that firms with WTAs use short-time work more than firms without WTAs. These findings call into question the popular hypothesis that WTAs were the key driver of the unusually small increase in German unemployment in the Great Recession."

"In the Great Recession most OECD countries used short-time work (publicly subsidized working time reductions) to counteract a steep increase in unemployment. We show that short-time work can actually save jobs. However, there is an important distinction to be made: While the rule-based component of short-time work is a cost-efficient job saver, the discretionary component appears to be completely ineffective. In a case study for Germany, we use the rich data available to combine micro- and macroeconomic evidence with macroeconomic modeling in order to identify, quantify and interpret these two components of short-time work."

"This paper analyzes Germany's unusual labor market experience during the Great Recession. We estimate a general equilibrium model with a detailed labor market block for postunification Germany. This allows us to disentangle the role of institutions (short-time work, government spending rules) and shocks (aggregate, labor market, and policy shocks) and to perform counterfactual exercises. We identify positive labor market performance shocks (likely caused by labor market reforms) as the key driver for the 'German labor market miracle' during the Great Recession."

"This paper investigates whether the effects of structural labor market reforms depend on the business cycle. Based on search and matching theory, we propose an unobserved components approach with Markov switching to distinguish the effects of structural reforms that increase the flexibility of the labor market in recession and expansion. Our results for Germany and Spain show that reforms have substantially weaker expansionary effects in the short-run when implemented in recessions. In consequence, reforms are unlikely to mitigate the impact of crisis in the short-run. From a policy perspective, these results highlight the costs of introducing reforms in recessions."

"Kurzarbeit ermöglicht es Firmen, die von einem vorübergehenden Nachfrageausfall betroffen sind, die Arbeitszeit ihrer Beschäftigten temporär zu reduzieren. Gleichzeitig kompensiert der Staat einen Teil des Lohnausfalls. Kurzarbeit ist somit ein zielgerichtetes arbeitsmarktpolitisches Instrument zur Flexibilisierung des Arbeitsinputs, das Kündigungen vermeidet und die Beschäftigung stabilisiert. Während der Wirtschafts- und Finanzkrise der Jahre 2008 und 2009 hat eine Vielzahl der OECD Länder Kurzarbeit genutzt. Dabei war der Anteil der KurzarbeiterInnen an der Beschäftigung in Deutschland etwa fünf121 43. Jahrgang (2017), Heft 1 Wirtschaft und Gesellschaft mal so hoch wie in Österreich. In diesem Beitrag stellen wir die Ergebnisse unseres aktuellen Forschungsprojektes zum Thema Kurzarbeit vor. Darin trennen wir diskretionäre Kurzarbeitspolitik von der regelgebundenen Komponente und fokussieren uns auf mögliche zeitvariierende Effekte. Unsere Ergebnisse für Deutschland zeigen, dass die Effekte von diskretionären ad-hoc Politikmaßnahmen stark zeitabhängig sind: In tiefen Rezession wirkt diese Politik deutlich beschäftigungsstabilisierend. Im Gegensatz dazu sind die Effekte in normalen Zeiten oder in Wirtschaftsaufschwüngen wesentlich geringer und können sogar negativ werden. Demnach ist diskretionäre Kurzarbeitspolitik umso effektiver, desto tiefer eine Rezession ist. Eine Analyse der Wirkungskanäle zeigt, dass die Beschäftigungseffekte durch eine signifikante Reduktion von Kündigungen zustande kommen.
Short-time work (STW) allows firms that face a temporary shortfall of demand to reduce the working hours of their employees. The employees are partly compensated by the government for their net wage loss. As such, STW is a targeted labor market policy with the aim to enable firms to adjust their labor input without dismissing workers. During the Great Recession the majority of OECD countries used STW schemes, however, countries differ widely in their STW usage. The share of short-time workers in Germany, for example, was five times higher compared to Austria. In this article, we present the results of our current research project on STW. We disentangle discretionary and rule-based STW policy and focus on possible time-varying effects of ad-hoc policy changes. Our results for Germany show that the employment effects depend crucially on the state of the business cycle: In deep recessions, discretionary STW policy stabilizes employment, whereas in normal times and expansions the effects are less clear and may even turn negative. We find that the deeper the recession, the more jobs can be saved with discretionary STW policy. An analysis of the underlying mechanism illustrates that the employment effects are caused by a significant reduction of lay-offs."

"Short-time work is a labor market policy that subsidizes working time reductions among firms in financial difficulty to prevent layoffs. Many OECD countries have used this policy in the Great Recession. This paper shows that the effects of short-time work are strongly time dependent and non-linear over the business cycle. It may save up to 0.8 jobs per short-time worker in deep economic crises. The policy becomes more efficient as the recession deepens. In expansions, the effects are smaller and may turn negative. We disentangle discretionary short-time work from automatic stabilization in German data using smooth transition VARs."

"This paper analyzes Germany's unusual labor market experience during the Great Recession. We estimate a general equilibrium model with a detailed labor market block for post-unification Germany. This allows us to disentangle the role of institutions (short-time work, government spending rules) and shocks (aggregate, labor market, and policy shocks) and to perform counterfactual exercises. We identify positive labor market performance shocks (likely caused by labor market reforms) as the key driver for the "German labor market miracle" during the Great Recession."

"Die Corona-Krise trifft Wirtschaft und Arbeitsmarkt schon jetzt deutlich härter als die Finanzkrise von 2009. So sind heute wesentlich mehr Branchen betroffen als damals. Gleichwohl hält sich die Zahl der Entlassungen im Vergleich zur Kurzarbeitsnutzung bislang in Grenzen. Die Tatsache, dass alle Branchen bis dato sehr viel stärker auf Kurzarbeit als auf Entlassungen setzen, zeigt, dass die Betriebe bisher ganz überwiegend gewillt sind, ihr Personal zu halten."

"In the Covid-19 crisis, most OECD countries use short-time work schemes (subsidized working time reductions) to preserve employment relationships. This paper studies whether short-time work can save jobs through stabilizing aggregate demand in recessions. We build a New Keynesian model with incomplete asset markets and labor market frictions, featuring an endogenous firing as well as a short-time work decision. In recessions, short-time work reduces the unemployment risk of workers, which mitigates their precautionary savings motive and aggregate demand falls by less. Using a quantitative model analysis, we show that this channel can increase the stabilization potential of short-time work over the business cycle up to 55%, even more when monetary policy is constrained by the zero lower bound. Further, an increase of the short-time work replacement rate can be more effective compared to an increase of the unemployment benefit replacement rate."