Short-time work increases sharply – next 3 months extreme increase

Short-time work (here also the most recent data) is increasing strongly in German industry. For a very up-to-date picture, it seems to make sense to look at current data and concrete forecasts. These are based on surveys of industrial companies. For example, the ifo Institute has recently published data on this topic.

Short-time work will rise sharply

The situation is dramatic. Currently, more than 100,000 workers in German industry are on short-time work. Is it only a question of weeks that the Federal Government, as in the financial crisis, will significantly extend the period for which short-time workers are paid. As a result, tens of thousands of short-time workers will not have to be made unemployed directly. According to the ifo survey, 8.4% of industrial companies currently use short-time work. This is the highest level since 2010. The proportion of companies expecting to go into short-time work in the next three months has risen to 15.3 percent.

The situation is currently worst in the steel industry. 16% of companies currently use this instrument to avoid layoffs. According to the survey, 40% of steel companies will probably use short-time work in the next three months. That is violent! The chart shows how the use of this labor market instrument is currently skyrocketing.

ifo-Grafik zur Entwicklung der Kurzarbeit

Here is an extract of the wording of the ifo Institute:

“The recession in industry is leaving increasingly deep marks on the labor market. With short-time work, companies can bridge the order stagnation and retain their skilled workers. If the situation improves again, they can start their working hours again and save themselves the difficult search for employees.” According to the ifo survey, short-time work in German industry is currently concentrated in eight sectors. With a share of 16 percent, steel production and processing are the sectors most affected. In the next three months, as many as 40 percent of companies in this sector intend to introduce short-time work. Short-time work is currently being introduced primarily in Rhineland-Palatinate, Saarland and Bavaria. But also in Baden-Württemberg, Saxony and North Rhine-Westphalia a strong increase is to be expected in the coming three months.

Here is a comparison of the current situation with the expected development over the next three months.

ifo Grafiken Ist-Zustand und Prognose zur Kurzarbeit
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