Germany: Short-time work helps labour market but raises costs

Research published in October 2009 finds that short-time work has been used massively in Germany during the recession to prevent redundancies, but the cost for employers has been high.

The statutory short-time working scheme (Kurzarbeit), which has been progressively widened in scope in recent months, has been regarded as a key means for holding back the growth of unemployment and enabling firms to retain skilled workers during the manufacturing recession.