ABSTRACT

Centering on Coronavirus: Could Germany's Kurzarbeit Come to America?   [open pdf - 0B]

From the Document: "Shouldn't this historic government response from Washington buy us something better than the worst unemployment crisis since the 1930s, with millions of workers unsure when or if they 'll be able to go back to their old jobs? It should, and it could, if America was committed to a more robust program to keep workers connected to their jobs. Like, for example, in Germany, whose response to the economic crisis brought about by the COVID-19 [coronavirus disease 2019] pandemic has largely relied on a program called Kurzarbeit. Translated as 'short-time work,' this government program directly pays workers 60-70% of their salary while maintaining their employment status during periods of reduced working time. This alternative furlough scheme has proven successful in reducing unemployment in previous economic crises and is doing so once again now. In Germany, the unemployment rate as of May 2020 was 6.3%, significantly lower than the 13.3% rate experienced in the U.S. Even though some of that disparity can be explained by Germany being able to more effectively stem the spread of COVID-19 and avoid the ruinous lockdowns that were required in the U.S., Kuzarbeit has unquestionably played a role in helping prevent layoffs of German workers. Other European countries, including the UK, Denmark, and the Netherlands, have implemented similar models after recognizing Germany 's success in recovering from the 2008 recession. In this paper, The New Center explores how the U.S. might embrace a Kurzarbeit-like program to protect American jobs in future recessions."

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2020-06
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The New Center
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The New Center: https://newcenter.org/
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