Germany to extend short-time working scheme

23rd November 2009, Comments 0 comments

The state-subsidised programme, which encourages firms to place workers on shorter shifts rather than fire them, has held back unemployment in Germany even as the economy struggles with its deepest recession in six decades.

Berlin -- Germany will extend by 18 months a scheme that allows firms to reduce employees' working hours, which has done much to cap jobless in Europe's largest economy, a spokesman said Sunday.

Labour Minister Franz Josef Jung announced the extension to the scheme at a party meeting on Saturday, the spokesman said.

The state-subsidised programme, which encourages firms to place workers on shorter shifts rather than fire them, has held back unemployment in Germany even as the economy struggles with its deepest recession in six decades.

Under the scheme, the government pays a part of the employee's salary for a set time while he or she is working fewer hours. In September, slightly more than one million people were on the programme.

Prior to Jung's announcement, firms that wanted to claim the scheme had until the end of this year. Chancellor Angela Merkel had already hinted the scheme would be extended without giving concrete details.

Unemployment in Germany posted a surprise fall in October, bolstering hopes that Europe's economic powerhouse, could lead the continent out of recession in decades.

AFP/Expatica

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