Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/58993
Year of Publication: 
2011
Series/Report no.: 
IZA Discussion Papers No. 6250
Publisher: 
Institute for the Study of Labor (IZA), Bonn
Abstract: 
The mild response of the German labor market to the worst global recession in post-war history appears as an economic miracle. In response to the crisis, Germany has shown to be a strong case of internal flexibility. We argue that important factors that have contributed to this development include the strong position of the German economy due to recent labor market reforms, the nature of the crisis affecting mainly export-oriented companies in Germany, the extension of short-time work, the behavior of social partners, and automatic stabilizers. Among these factors, we emphasize the key role of the interaction between short-time work and long-term shortages of skilled workers in sectors and regions that were particularly affected by the crisis. Although the German experience is in stark contrast to that in the United States, we identify and discuss three challenges that will be at the center of debate on both sides of the Atlantic in the future.
Subjects: 
economic crisis
Germany
short-time work
unemployment
labor market institutions
internal flexibility
JEL: 
J68
J21
P52
O57
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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