Seminar Series “Macroeconomics and Labor Markets” on 5 November 2024
We are pleased to invite you to the seminar series on “Macroeconomics and Labor Markets“ organized by the Chair of Macroeconomics at the Friedrich-Alexander University Erlangen-Nuremberg, Prof. Merkl, the Chair of Global Governance and International Trade at the Friedrich-Alexander University Erlangen-Nuremberg, Prof. Moser, and the Competence Field Macroeconomics of the Institute for Employment Research (IAB). Researchers of both institutions, as well as national and international guests, present their current work at the intersection of labor- and macroeconomics.
The next seminar will be held on Tuesday, November 5, 12 noon to 1.30 p.m. (German time).
The seminar will take place in person at IAB, Regensburger Str. 100, room E10.
Online participation is possible via Skype.
Christian Kagerl (IAB) will talk about “The Employment and Windfall Effects of Short-Time Work: Evidence from Germany”.
Abstract:
I study the ramifications of the German short-time work (STW) scheme using novel administrative data on STW and drawing on evidence from establishment surveys that are linked to the administrative data. I show that, besides financial reasons, firms value and use STW because it allows them to hoard labor in a tight labor market. During the pandemic, I document a strong negative selection into STW based on measures of firm quality and productivity, a pattern not observed during the financial crisis. This selection pattern is explained by the differing types of crises and their impact on establishments. Adjusting for selection, I then investigate the employment effects of STW in the pandemic and find 3-4% higher employment levels for firms utilizing STW. This relationship, however, vanishes quickly after firms exit STW, a result driven by outflows among STW firms being initially lower, but being higher after the end of STW. Partly due to eased access rules, I additionally find that the policy’s windfall effects, or deadweight losses, are large: While back-of-the-envelope calculations suggest that up to half a million jobs were saved by STW in 2020, millions of jobs were supported in total, indicating an insufficient degree of targeting.