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

At the height of the economic crisis in mid-2009, the number of Germany's short-time workers peaked at 1.5 million. Unemployment would otherwise have increased by approximately twice as much as it did. But while short-time work certainly helped to cushion the labour market impact of the crisis, the authors caution that the country's specific circumstances preclude simple generalizations regarding its global effectiveness. Moreover, they argue, subsequent amendments to the regulatory framework made the scheme vulnerable to abuse, as reflected in the significant numbers of short-term workers in industries unaffected by the crisis and the emergence of a pattern of long-term short-time work.