Short-time work: current figures show the dramatic situation

Kurzarbeit steigt dramatisch an

Will the instrument of short-time work be used as much in the wake of the coronavirus crisis as it was in the financial crisis from 2008 onwards? Will short-time work probably take on much more dramatic proportions? We are currently getting the first taste of this. By mid-March we can see how extensively industrial companies want to use this instrument to keep their workforce in operation. This employment market instrument is certainly useful in order to prevent people from falling into a hole. So that production can be ramped up again immediately after the crisis!

Expectations of short-time work shooting up

The ifo Institute today published data on short-time work based on a survey. The data was collected until mid-March. So we have not yet seen the worst effects of the last two weeks. But the situation is already dramatic. For example, 25.6 percent of all industrial companies expect short-time work in the next three months. This is the highest level since 2010, whereas three months ago it was only 15.3 percent.

The key sectors of the automotive industry (41 percent), mechanical engineering (33 percent) and electrical engineering (32 percent) have been affected above average. Here are more details from ifo in the wording:

Smaller sectors that will also be heavily affected by short-time working are metal production and processing with 49 percent. Other vehicle construction with 43 percent, textile manufacturers with 41 percent. 35 percent of manufacturers of leather goods and shoes and 27 percent of manufacturers of metal products.

Some sectors are less affected

Some sectors hardly expect any short-time work in the next three months. In the chemical industry it was only 14 percent and in the food industry six percent.

“The full extent of the corona pandemic has probably not yet been taken into account in all these figures. Most answers were received by mid-March,” says Klaus Wohlrabe, head of the ifo business surveys.

According to the ifo survey, 9.3 percent of industrial companies have already introduced short-time work. 15 percent of manufacturers of electrical equipment were affected. In mechanical engineering the figure was 14 percent, in the automotive industry 11 percent. Smaller sectors were metal production and processing and the textile industry with 23 percent. And manufacturers of leather goods and shoes with 20 percent. Short-time work has not been an issue in the chemical or food industry so far.

When we have data for the middle of April next month, will the figure already exceed the high from the financial crisis?

ifo-Chart zeigt den aktuellen Anstieg bei der Kurzarbeit
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