“Kurzarbeit” has had a positive employment effect during the crisis beneficial especially for the employment of workers on permanent contracts, typically older workers Whereas labour input adjustment has been made through the reduction of (temporary) workers in many countries, in Germany the adjustment has been made largely in hours per worker with the so called “Kurzarbeit” short time working scheme.
In this programme, firms temporarily reduce the hours of their workers and the loss in wages is partly compensated by the public funds. This short time working scheme has had a positive employment effect during the crisis.