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Short-time work: the German answer to the Great Recession

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Brenke, Karl ; Rinne, Ulf ; Zimmermann, Klaus F.

Institute of Labor Economics, Bonn

IZA - Bonn

2011

26 p.

economic recession ; short time working ; statistics ; unemployment ; labour market policy

Germany

Discussion Paper Series

5780

Unemployment

www.iza.org

English

Bibliogr.

"Short-time work was the "German answer" to the economic crisis. The number of short-time workers strongly increased in the recession and peaked at more than 1.5 million. Without the extensive use of short-time work, unemployment would have risen by approximately twice as much as it actually did. Short-time work has certainly contributed to the mild response of the German labor market to the crisis, but this is likely due to the country-specific context. Although the crisis has been overcome and employment is strongly expanding, modified regulations governing short-time work are still in place. This leads to undesired side effects."

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