The Role of Short-Time Work Schemes during the 2008-09 Recession

Alexander Hijzen · Danielle Venn

238 citations0/0 files storedOECD social employment and migration working papers

No readable copy stored yet — this record is metadata only.

No open-access location is known for this record yet.

Literature note Cite in a project Citation map

Labor market dynamics and wage inequality Employment, Labor, and Gender Studies Employment and Welfare Studies

Abstract

The present paper provides the most comprehensive assessment to date of the impact of short-time work (STW) schemes during the 2008-09 crisis. The analysis covers 19 OECD countries, 11 of which operated a short-time work scheme before the crisis, five countries introduced a new scheme during the crisis period and three countries never had a short-time work scheme. In order to identify the causal effects of short-time work, a difference-in-differences approach is adopted that exploits the variation in labour-adjustment patterns and the intensity with which STW schemes are used across countries and time. The estimates support the conclusion that STW schemes had an economically important impact on preserving jobs during the economic downturn, with the largest impacts of STW on employment in Germany and Japan among the 16 countries considered. However, the positive impact of STW was limited to workers with permanent contracts, thereby further increasing labour market segmentation between workers in regular jobs and workers in temporary and part-time jobs. The estimated jobs impact is smaller than the potential number of jobs saved as implied by the full-time equivalent number of participants in short-time work, suggesting that STW schemes end up supporting some jobs that would have been maintained in the absence of the subsidy. However, the estimated deadweight is less than that usually estimated for other job subsidy measures. As the OECD area is only just starting to emerge from the crisis, it is still too early to assess the impact of STW schemes in the longer term. Indeed, the main concerns about STW schemes relate to their potentially adverse impacts on the vigour of employment growth during the recovery and economic restructuring in the longer run.

Paper brief

Loading…

Cite this work

Citation unavailable for this work.

BibTeX RIS CSL-JSON

No public copy is stored for this record, so only the metadata is cited.

Citations in this library

Citation map →

Stored only when both papers are in the corpus — 238 citations exist upstream.

References

1990An Illustration of a Pitfall in Estimating the Effects of Aggregate Variables on Micro Units 2002What Works and for Whom: A Review of OECD Countries' Experiences with Active Labour Market Policies 2001What works and for whom: a review of OECD countries' experiences with active labour market policies 2009Legislation, Collective Bargaining and Enforcement

Cited by

2011Short-time work benefits revisited: some lessons from the Great Recession 2013Society at a Glance 2014 2015Does short-time work save jobs? A business cycle analysis 2014Fiscal Policy and Income Inequality 2011Transitions in the German labor market: Structure and crisis 2020Job retention schemes during the COVID-19 lockdown and beyond 2015Active labor market programs - employment gain or fiscal drain?2010European Economic and Social Committee

Explore the map →

Papers that cite the same references — the relational fallback while embeddings are still backfilling.

Imported from OpenAlex (CC0) — nothing here is generated.