German firms roll back shift reductions | Business| Economy and finance news from a German perspective | DW | 16.06.2010
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German firms roll back shift reductions

Manufacturers across the country are reinstating regular working hours as the pace of Germany's economic recovery picks up.

A man cleans a giant clock face. Next to it are other clocks.

Back on the big clock for German workers

In an interview with the mass-circulation Bild newspaper, Volker Treier, chief economist of the German Chambers of Industry and Commerce (DIHK), said that some 90 percent of workers put on reduced hours during the financial crisis would be back in full-time employment in the foreseeable future.

"At the most we anticipate 100,000 employees to be on reduced hours by the end of the year," Treier said, citing increased demand in many branches as the reason for the return to normality.

Companies in the metal and electronic sectors expect to be running back at full capacity by the close of 2010.

According to statistics released by the Federal Labor Agency (BA) more than 800,000 employees were working fewer hours at the end of March. At the peak of the crisis, the figure was even higher, with one and a half million on a working a reduced shifts.

The scheme, supported by Chancellor Angela Merkel's government, was introduced last year in light of dwindling exports and was designed to prevent large-scale nationwide lay-offs.

Companies that signed up to the system only pay their staff the hours they actually work, thereby significantly cutting their labor costs.

The government picked up the bill for workers' social welfare contributions and paid an allowance to compensate them for some of their lost income. Typically, the program sees workers without children receive 60 percent of their net salary, while those with children take home an extra 7 percent.

Author: Tamsin Walker (dpa/AFP)
Editor: Sam Edmonds

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