What Is Business Waiting For?
By JOE NOCERA
NYT
When the German economy turned south after the 2008 financial crisis, the pain was mitigated by a program known as “Kurzarbeit.”
The word means short work. Instead of laying off workers, German companies cut back their hours. The government then used money set aside during good times to pay the workers around 60 percent of their lost wages. The labor unions went along because they believed it was better to keep people employed even at reduced pay. This is the German social compact.
As we suffer through our own economic hard times, the German approach is something we can only envy. Here, companies quickly lay off workers, many of whom never find their way back into the full-time labor force. Corporations shy away from investing for the future, even though investment is what will turn the economy around. The government, for its part, invariably starts talking about “job creation,” but rarely does anything that makes a difference.
This downturn is no exception. What are the latest unemployment figures? Some 25 million people — more than 16 percent of the work force — are looking for full-time work. Companies are hoarding cash while reporting record profits.
(More here.)
NYT
When the German economy turned south after the 2008 financial crisis, the pain was mitigated by a program known as “Kurzarbeit.”
The word means short work. Instead of laying off workers, German companies cut back their hours. The government then used money set aside during good times to pay the workers around 60 percent of their lost wages. The labor unions went along because they believed it was better to keep people employed even at reduced pay. This is the German social compact.
As we suffer through our own economic hard times, the German approach is something we can only envy. Here, companies quickly lay off workers, many of whom never find their way back into the full-time labor force. Corporations shy away from investing for the future, even though investment is what will turn the economy around. The government, for its part, invariably starts talking about “job creation,” but rarely does anything that makes a difference.
This downturn is no exception. What are the latest unemployment figures? Some 25 million people — more than 16 percent of the work force — are looking for full-time work. Companies are hoarding cash while reporting record profits.
(More here.)
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