scholarly journals Germany’s Labour Market Policies

2019 ◽  
pp. 283-303
Author(s):  
Florian Spohr

Germany has become one of the most competitive economies in the world. Only a decade and a half ago it was widely derided as stagnant, and ridden by political paralysis in reforming its labour market policies. However, in 2002, the discovery of manipulated statistics in the German Employment Agency opened a window of opportunity to break the stalemate in corporatist policymaking. In response, the government convened a commission to design labour market policy reforms: the Hartz Committee, named for its chair, Peter Hartz. Including experts, politicians, and members from interest groups in the commission enabled the government to promote the ‘Hartz Reforms’ on the basis of expertise and compromise. Their focus was on creating incentives for seeking employment. Job search assistance and monitoring gained importance, whereas ineffective job creation and early retirement schemes were abolished or reduced. These activating reforms successfully tackled structural unemployment and increased the overall employment rate. Their success in strengthening economic resilience was demonstrated during the 2008 economic crisis, when in combination with other measures such as the extension of short-time work, and controlled unit labour costs, they led Germany’s labour market through the deep recession.

Author(s):  
Patrik Vesan ◽  
Emmanuele Pavolini

The Italian labour market has been put under very strong pressure since the onset of the financial and economic crisis. After the 2011 sovereign debt crisis a new wave of reforms started in relation to labour market policies. Although it is not possible to detect a single trajectory of change in Italian labour market policies, we can observe an overall tendency toward a peculiar version of ‘welfare readjustment’, a pattern of reform in which governments curtail such policies as income or job protection for insiders, while adopting new social policies. This ‘readjustment process’ has been realised through the adoption of some provisions that favour ‘outsiders’ and, at the same time, the drastic retrenchment of labour rights for workers on open-ended contracts. As a result, the boundaries between ‘insiders’ and ‘outsiders’ now appear more blurred than they were before the outbreak of the Great Recession.


2010 ◽  
Vol 214 ◽  
pp. R38-R50 ◽  
Author(s):  
Jens Boysen-Hogrefe ◽  
Dominik Groll

This paper lays out the various reasons for the exceptional performance of the German labour market during and after the Great Recession of 2008/9. The reference point of our analysis is provided by an empirical model of both total hours worked and employment. We conduct dynamic simulations of the crisis period to assess how surprising the reaction of the labour market really was. We argue that the most important precondition for the minor reaction of employment during this crisis was the pronounced wage moderation observed in the years before, which constitutes a distinct difference to all other recessions in Germany. Beyond that, the flexibility of adjusting working time, which has increased considerably during the past ten years, facilitated a tendency to labour hoarding. In contrast, short-time work plays a minor role in explaining the difference from previous recessions, since this instrument has always been available to firms in Germany and its use has not been extraordinary compared with earlier recessions.


2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
José M. Arranz ◽  
Carlos García-Serrano ◽  
Virginia Hernanz

PurposeThis paper investigates whether short-time work (STW) schemes were successful in their objective of maintaining employment and keeping workers employed within the same firms after the onset of the financial and economic crisis in 2008.Design/methodology/approachSpanish longitudinal administrative data has been used, making it possible to identify short-time work (STW) participation not only of workers but also of employers and allowing to know the future labour market status of participants and non-participants. Accordingly, treatment and control groups are defined, and Propensity Score Matching models estimated. The dependent variable is measured as the probability that an individual remained employed with the same employer in the future (one, two and three years) after implementation of a STW arrangement.FindingsOur results suggest that treated individuals are about 5 percentage points less likely to remain working with the same employer one year later than similar workers, and this negative effect of participation increases over time. Thus, STW schemes would not have the assumed effect of preventing unemployment by keeping the participants employed relative to non-participants.Research limitations/implicationsAs our analysis is based on the comparison of the employment trajectories of participant and non-participant workers in firms that have used STW arrangements, our findings cannot be interpreted as the job saving effects of either macro or micro studies carried out previously.Practical implicationsThe analysis carried out in the paper is complementary to the country-level and firm-level approaches that have been used in the empirical literature.Originality/valueWe adopt a worker-level approach. This is novel since no previous study has focused attention on the impact of STW participation on the subsequent labour market status of workers.


2020 ◽  
Vol 30 (1) ◽  
pp. 59
Author(s):  
Martin Dietz ◽  
Michael Stops ◽  
Ulrich Walwei

As a consequence of the global financial crisis Germany experienced the deepest slowdown of its economy since World War II. However, given the sharp decrease of GDP the German labour market was quite stable compared to previous recessions when the labour market response was stronger. Therefore, there are empirical indications for temporary labour hoarding and it can be shown that the most significant factor for securing jobs was a reduction of working time. At the beginning of the crisis the conditions for short-time work became more attractive to firms. Therefore, non-subsidised forms of working time reductions or labour hoarding were complemented by public subsidies in the form of short-time work.


2021 ◽  
Author(s):  
Nadia Steiber ◽  
Christina Siegert ◽  
Stefan Vogtenhuber

Objective: This study investigates the impact of the COVID-19 pandemic on the employment situation of parents and in turn on the subjective financial well-being of families with children in Austria. Background: The pandemic had strong repercussions on the Austrian labour market. The short-time work (STW) programme covered a third of employees in the first half of 2020 and helped to maintain employment levels. We provide evidence on how an unprecedented labour market crisis of this sort and in particular the exceptionally wide use of STW had affected the (gendered) employment situation of parents and the financial well-being of different types of families. Method: The study draws on representative panel survey data that cover 905 families with underage children. The data include information on the employment situation and financial well-being of single and cohabiting parents before the onset of the crisis, three months and ten months after its onset. Results: In contrast to other countries, mothers were not more strongly affected by the labour market crisis of 2020 than childless women or fathers. About a third of couples with underage children experienced income losses. Despite the wide use of STW and government support to families, the share of families in financial difficulties has substantially increased, especially among those with many children and single parents, many of who were at risk of poverty already before the crisis. Conclusion: Substantial shares of dual-earner families that had low poverty risks before the crisis were in financial difficulties in 2020. Potential spill-over effects of financial shocks on children are discussed.


2020 ◽  
Vol 69 (11) ◽  
pp. 749-770
Author(s):  
Ulrich Walwei

Zusammenfassung Der Beitrag beleuchtet die Herausforderungen der sich gerade vollziehenden „transformativen Rezession“ für den Arbeitsmarkt. Nach Jahren eines scheinbar unaufhaltsamen Aufschwungs hat die Corona-Krise den Arbeitsmarkt schwer getroffen. Erwerbstätigkeit und sozialversicherungspflichtige Beschäftigung bewegten sich erstmals seit Jahren wieder nach unten und die Arbeitslosigkeit schnellte nach oben. Zusätzlich erreichte die Nutzung der Kurzarbeit ein immenses Allzeithoch. Gleichzeitig vollzieht sich eine Transformation der Volkswirtschaft. Es zeichnete sich schon seit längerem ab, dass Demographie, Digitalisierung, Klimaschutz und Verschiebungen in der internationalen Arbeitsteilung größere Veränderungen für die Wirtschaft und den Arbeitsmarkt nach sich ziehen werden. Theoretisch-konzeptionelle Überlegungen zeigen, dass aus heutiger Sicht Wirtschaft und Arbeitsmarkt noch längere Zeit benötigen, bis wieder Vorkrisenstände erreicht werden können. Dabei liegt der Schlüssel für die Erholung nicht wie sonst üblich vorwiegend im Spielfeld der Wirtschafts- und Finanzpolitik, sondern auch und gerade im Bereich des Gesundheitsschutzes. Die Pandemie wird zudem dafür sorgen, dass sich die Transformation der Wirtschaft teilweise beschleunigt. Dies gilt insbesondere für die Digitalisierung, deren wirtschaftliche Vorteile während der Krise besonders zum Vorschein kamen. Andere dringliche Aufgaben wie etwa der Klimaschutz bestehen unabhängig von der Pandemie weiter fort. Vor diesem Hintergrund wird es aus arbeitsmarktpolitischer Sicht in der nahen Zukunft darauf ankommen, sowohl die Krise als auch die wirtschaftliche Transformation zu adressieren, am besten durch eine möglichst geschickte Kombination aus einer gleichermaßen konjunkturorientierten und investiven Arbeitsmarktpolitik. Abstract: The Labour Market Facing Old and New Challenges: The Covid-19-Pandemic, what’s Next? The paper discusses the challenges of the current “transformative recession” for the labour market. After years of an almost unstoppable upswing, the corona-crisis smashed the labour market. Employment went down significantly and unemployment increased. In addition, short-time work reached an all-time-peak. At the same time, the economy is confronted with a process of continuous transformation. In recent years, it became clearly apparent that demography, digitization, climate protection and changes in the international division of labour cause fundamental changes for the economy as well as the labour market. Conceptual and theoretical considerations show, that both, economy and the labour market, will take a long time to reach pre-crisis levels. However, the key for the recovery is not mainly located in the playing field of economic and fiscal policy but in the area of health protection. In addition, the pandemic will accelerate the economic transformation. This is obvious regarding digitization, which reveals its economic advantages during the pandemic. Other urgent challenges such as climate protection will definitely remain. Against this background, it will be decisive for labour market policies to address the crisis and the transformation at the same time, preferably by an intelligent combination of measures oriented at short-time impacts and long-term investment.


2020 ◽  
Vol 55 (6) ◽  
pp. 375-380
Author(s):  
Werner Eichhorst ◽  
Paul Marx ◽  
Ulf Rinne

AbstractThe unprecedented COVID-19 pandemic has a severe impact on societies, economies and labour markets. However, not all countries, socio-economic groups and sectors are equally affected. Part of this disparity can be related to the different role and extent of short-time work, which is now being used more widely than during the Great Recession. Furthermore, unemployment benefits have been made more generous in many countries. While it is still too early to assess the relative success of national strategies to cope with the pandemic and to revitalise the labour market as well as to evaluate the medium-term fiscal viability of different support measures, a few policy directions become apparent. These include the use of digital tools to increase resilience against economic shocks, the longer-term perspective of short-time workers in the current crisis, social protection for self-employed workers that is robust to economic crises and resilient models for school-to-work transitions of younger workers.


2020 ◽  
Vol 36 (2) ◽  
pp. 200-216
Author(s):  
Hyejin Ko ◽  
Eunchong Bae

AbstractThis study seeks to determine the effectiveness of the active labour-market policies (ALMPs) of employment-oriented welfare states contribute to the financial soundness of welfare states. Even if they are insignificant, overall, the results show that ALMPs lead to higher employment rate and sounder public finances as could be expected by the central idea of employment-oriented welfare states. However, extending ALMPs does not always create a virtuous circle among government interventions, employment rate and fiscal soundness. That is, the results for employment and public finances depend on how the government intervenes in the labour market. We argue that the critical point goal should be to improve employability, not just to increase the employment rate.


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