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Short-time work on the rise

Hubertus Heil (Federal Minister of Labour) and Detlef Scheele (Chairman of the BA) on the state of the German labour market in March
31 Mar 2020 | Press Release No. 19

Ever since the population was told to remain indoors to combat the current pandemic, the number of short-term working arrangements reported to the Federal Employment Agency (BA) has reached a record high. The BA has now published its initial evaluation for March in collaboration with the Federal Ministry of Labour and Social Affairs (BMAS), according to which around 470,000 short-time working arrangements were reported to the BA throughout Germany in March.

By way of comparison, an average of around 1,300 companies reported short-time working arrangements each month in 2019. Only 1,900 short-time working arrangements had been reported by February 2020. There is a high demand in all federal states. The reports are being sent from almost all industries – unlike in the financial crisis of 2008/2009, which mainly affected the manufacturing sector. Some of the most affected areas include trade, hotels and catering. The 470,000 reports indicated above were measured as part of a special evaluation carried out by the BA. The figures include all reports submitted to the BA by 27 March 2020, but they do not represent the official statistics.

Hubertus Heil, Federal Minister of Labour:

“Overcoming the corona pandemic will be a historic effort. We may be exposed to this crisis, but we will not surrender. Despite our many concerns and uncertainties, we also have reason to be hopeful. We have one of the strongest welfare states in the world, and we’ve built up reserves for hard times during our good years. Our democracy is strong enough to withstand a crisis and has already launched comprehensive protective measures in the shortest possible time. And we have millions of heroes who continue to excel themselves at this difficult time – not only in our hospitals, but also in our local neighbourhoods. Together, we will guide our country safely through the crisis. We’re supporting our citizens as much as possible with economic aid, short-time working allowance, continued wage payments for parents whose children cannot currently be looked after at schools or nurseries, and our welfare package for the self-employed and other people. Our aim is to ensure everyone’s health and safety, prevent redundancy and guarantee social security”.

Detlef Scheele, Chairman of the BA:

“Short-time work will be our weapon of choice when tackling this historic challenge for the economy and labour market. We’re safeguarding people’s jobs and helping companies keep hold of their employees, highlighting the importance of the Federal Employment Agency as an anchor of stability for our economy and welfare state. Although we’re not yet in a position to reliably predict how many people will be affected by short-time working arrangements, we expect the number to be much higher than in the economic crash, when 1.4 million people had reduced working hours at the peak of the crisis. We have already fast-tracked a request for an additional 10 billion euros from our Administrative Board and the Federal Ministry of Labour. Nobody has to fear they might be left behind, as short-time working allowance is a standard benefit paid out to anyone who meets the requirements”.

The BA has restructured its organisation to quickly and comprehensively process applications and respond to all enquiries. It is currently focusing on offering advice on short-time working arrangements and quickly granting short-time working allowance, unemployment benefits and basic security benefits.

The teams responsible for short-time working arrangements have been reinforced from 800 to around 4,500 employees – with more measures set to follow. In addition, approximately 18,000 members of staff are now working on the telephone helplines – there are usually around 4,000 call centre operators. The BA’s telephone network has been significantly expanded; the usual service hotlines have been supplemented with local numbers for anyone affected by the crisis.

The BA is now asking employers to make greater use of its online services. Employers can report short-time working arrangements and apply for short-time working allowance online – it’s quick, safe and flexible.

Employers and employees can also find more information on short-time working arrangements and the relaxed regulations on the BA and BMAS websites: www.arbeitsagentur.de and www.bmas.bund.de.