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Germanys Labour Market in Coronavirus Distress New Challenges to Safeguarding Employment

Author

Listed:
  • Alexander Herzog-Stein

    (Macroeconomic Policy Institute (IMK), University of Koblenz-Landau)

  • Patrick Nuess

    (Kiel University)

  • Lennert Peede

    (University of Muenster)

  • Ulrike Stein

    (Macroeconomic Policy Institute (IMK))

Abstract

We analyse measures of internal flexibility taken to safeguard employment during the Coronavirus Crisis in comparison to the Great Recession. Cyclical working-time reductions are again a major factor in safeguarding employment. Whereas during the Great Recession all working-time instruments contributed to the reduction in working time, short-time work now accounts for almost all of the working-time reduction. Short-time work was more rapidly extended, more generous, and for the first time a stronger focus was put on securing household income on a broad basis. Still, the current crisis is more severe and affects additional sectors of the economy where low-wage earners are affected more frequently by short-time work and suffered on average relatively greater earnings losses. A hypothetical average short-time worker had a relative income loss in April 2020 that was more than twice as large as that in May 2009. Furthermore, marginal employment is affected strongly but not protected by short-time work.

Suggested Citation

  • Alexander Herzog-Stein & Patrick Nuess & Lennert Peede & Ulrike Stein, 2021. "Germanys Labour Market in Coronavirus Distress New Challenges to Safeguarding Employment," IMK Working Paper 209-2021, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.
    • Handle: RePEc:imk:wpaper:209-2021
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    References listed on IDEAS

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    Cited by:

    1. Fackler, Daniel & Schnabel, Claus & Stegmaier, Jens, 2024. "Personnel adjustments during the Covid-19 pandemic: did co-determination make a difference?," Journal for Labour Market Research, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 58, pages 1-4.
    2. Peltonen, Juho, 2023. "On the efficiency of labor markets with short-time work policies," MPRA Paper 119165, University Library of Munich, Germany.
    3. Toralf Pusch & Hartmut Seifert, 2021. "Kombination von Kurzarbeit und Qualifizierung — ein gutes Konzept mit mäßigem Erfolg [Combination of short-time work and qualification — a good concept with moderate success]," Wirtschaftsdienst, Springer;ZBW - Leibniz Information Centre for Economics, vol. 101(8), pages 660-662, August.
    4. Herzog-Stein, Alexander & Nüß, Patrick & Peede, Lennert & Stein, Ulrike, 2022. "Germany and the United States in coronavirus distress: internal versus external labour market flexibility," Journal for Labour Market Research, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 56, pages 1-11.
    5. Peltonen, Juho, 2023. "Short-time work in search and matching models: Evidence from Germany during the Covid-19 crisis," MPRA Paper 119238, University Library of Munich, Germany.
    6. Ben Yahmed, Sarra & Berlingieri, Francesco & Brüll, Eduard, 2022. "Adjustments of local labour markets to the COVID-19 crisis: The role of digitalisation and working-from-home," ZEW Discussion Papers 22-031, ZEW - Leibniz Centre for European Economic Research.

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    More about this item

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies
    • J20 - Labor and Demographic Economics - - Demand and Supply of Labor - - - General

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