Number of Short-Time Workers in Germany Drops Despite Slowdown

The number of short-time workers in Germany has fallen despite the economic slowdown. In August, 110,000 people were on short-time work, down from 150,000* in May, according to estimates by the ifo Institute based on the ifo Business Survey and figures from the German Federal Employment Agency. “Germany’s weak economy has had little effect so far. One reason for this may be that the regulations facilitating access to short-time allowances expired at the end of June,” says ifo labor market researcher Sebastian Link. As a share of the workforce, the figure fell from 0.4 to 0.3 percent.

Manufacturing accounts for about 80 percent of short-time workers. But there, too, the number declined from 118,000 to 89,000 – or from 1.7 to 1.3 percent of the work-force in this segment. Not all industries have seen a decline, however. The number of short-time workers increased in basic metals manufacturing (from 7,400 to 11,000) and among manufacturers of machinery and equipment (from 13,000 to 20,000). “Interestingly, short-time work has not played a role in construction, despite sentiment being extremely low,” Link says. In August, the estimated number of short-time workers there was 7,000, roughly the same as in May (8,000). In trade, the figure was 3,000, down from 6,200, and for all service providers combined, the figure was only 11,000, down from 18,000.

In August 2022, the number of short-time workers was lower in the economy as a whole: 76,000 people – 0.2 percent of the workforce – were on short-time work. At its coronavirus crisis peak, in April 2020, the figure was as high as 6 million, or 17.8 percent. Short-time work is a type of part-time unemployment that applies particularly when there is a temporary lack of orders. Employees receive a short-time allowance at the level of unemployment benefits for the hours lost.

* Revised figure.