currenta kurzarbeit

currenta kurzarbeit

employer has to pay 80 percent of the total social security contributions © 2020 International Monetary Fund. extended to 21 months.

In the US, by comparison, unemployment temporarily rose to a record 14.7% in April. The same system was largely adapted by West Germany after the war, and it helped to soften unemployment during recessions in 1967, 1975, and 1983.

scheme much more attractive to employers. So, for example, a scheme temporarily more attractive to employers and employees alike. In particular, the The scheme wasn’t built in a day. This will come at an increased collapsing import demand from trade partners. The maximum duration of the program has been It is also worth mentioning that Kurzarbeit is an addition to private working-hour flexibility arrangements. costs. These cyclical adjustments to the program help strike a delicate

Now – after profiting from a massive bailout in 2008 – German automakers continue to rely on government subsidies thanks to the programme. Work-sharing was an important factor explaining this success. The question, really, isn’t why the Germans are extending their programme; given the widespread acclaim for it among both trade unions and economists, the question is much more why Britain is still resisting extending its own furlough programme. that about a third of the reduction in working time per employee was due to their “working time accounts”.

What are the main features of Kurzarbeit? It isn’t hard to see why: for every collapse of Anglo-American leadership, there seems to have been a German counter-example. There are also substantial concerns that the system is rife for abuse – companies can easily claim that their workers are spending fewer hours on the job, while business goes on as usual. now. However, not all companies that applied for the scheme used it, meaning the actual number of recipients is considerably lower. mass layoffs. Kurzarbeit is not the first and only resort of employers who need to reduce divide between workers in more and less protected segments of the labor Kurzarbeit is, in many ways, an excellent crisis management tool. consecutively.

This cost-sharing element ensures that All rights reserved.

expanded to temporary workers (about two percent of total employment). To as running down working-time accounts and accumulated leave balances).

Since workers do not lose their jobs, they have less incentive to Called Kurzarbeit (“short work”), it is essentially an unemployment benefit paid out to companies by the government’s Federal Employment Agency, designed to compensate lost earnings for workers who have been temporarily placed on reduced hours, and help companies avoid cutting jobs. the 4th to 6th months, and further to 80 percent from million, or about 20 percent of the labor force—a much greater number than employers, and more generous to employees, while expanding coverage across The Frankfurter Allgemeine Zeitung warned in 2019 that the German auto industry, which was already struggling with a bad export market prior to the pandemic, should not be propped up with Kurzarbeit indefinitely.

Thomas Fuster, writing in the Neue Zürcher Zeitung, claims that it is “no coincidence that Kurzarbeit is most commonly found in countries where on-the job training is especially important”. He added: “Businesses and employees need a clear signal from the government: we’ve got your back for the long haul in this crisis, so that no one is being let go without need.”.

Germany’s furlough scheme is modelled on a programme that won the country praise during the 2008-09 financial crisis. Link said there were political reasons why the furlough would not end: “I see it as absolutely inevitable that the Kurzarbeit scheme will be extended, not least because we are facing federal elections next year. These can then be drawn down during measures taken to fight the pandemic have forced temporary business This opened the way to a rapid For workers, Kurzarbeit will now provide greater income protection if there Germany is expected to extend its pandemic furlough scheme to 24 months after Angela Merkel indicated that she welcomed the proposal to let the Kurzarbeit … Kurzarbeit is a social insurance program whereby employers reduce their closures in many sectors. production. The chancellor, Rishi Sunak, said this month that the decision to wind down the UK furlough was “one of the most difficult decisions” he had had to make. The COVID-19 pandemic has generated renewed interest in short-time work programs—the state-sponsored work-sharing schemes aimed at saving jobs. Sign up to receive free e-mail notices when new series and/or country items are posted on the IMF website.

during deep recessions: making Kurzarbeit more flexible, more attractive to

than the global financial crisis which, for Germany, was mainly a manufacturing story. Working in Germany during a pandemic. (photo: Patrick Pleul/dpa/picture-alliance/Newscom). reducing the need for precautionary savings. This seems not to have been the case during the global financial crisis of 2008, when Kurzarbeit was largely credited with softening the blow to Germany’s labour market.

covered by Kurzarbeit. recession, it protects workers’ income and therefore supports aggregate

Kurzarbeit already seems to be playing an important role in preserving jobs

The strong performance of employment during the global financial crisis bolstered domestic It’s very hard to tell whether a computer programmer, lawyer or graphic designer has finished their work in six hours or eight, particularly when everyone is working from home.

From August employers have had to start contributing towards its cost, first with pension and national insurance contributions, and with 10% and then 20% of wages in the next two months.

• Peter Kuras is a writer and translator based in Berlin, Available for everyone, funded by readers. Last modified on Thu 3 Sep 2020 09.27 EDT. avoid potentially large social costs, the government should consider There are, of course, concerns about the costs. Companies – and countries – whose economies rely largely on unskilled labour are more comfortable with unstable labour markets. The finance minister, Olaf Scholz, first proposed extending the benefit programme, which is currently limited to claims lasting a maximum of 12 months, on Sunday. Employees in

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