The duration and amount of short-time work and unemployment benefits in Germany should be reduced in order to speed up job transitions, the ifo Institute has said.
The institute made the call in a briefing paper for the Chamber of Industry and Commerce of Munich and Upper Bavaria.
It called for efforts to shorten maximum period for receiving short-time work benefits from 24 months to 12 months, or even six months, which would give employees affected by structural change in their industry more incentive to change jobs quickly.
New employment
“Higher benefits and longer deadlines hinder those affected in their search for new employment,” commented ifo expert Volker Meier.
At the same time, the institute stressed that in order to make these changes fair and effective, access to retraining and accelerated qualification programs must be expanded.
These accelerated training programmes for those wishing to change career could help prevent or at least shorten unemployment, it added.
‘The ifo experts base their assessment on recent studies that have shown that higher or longer benefits increase the duration of short-time work and unemployment,’ the ifo Institute said. ‘They also point out that the transition from unemployment benefit II to citizen’s income has led to a significant expansion of benefits.’ Read more here.
