Unemployment and unemployment insurance
Unemployed, but not mediocre
Assistance is secured
Those who are affected by loss of work or become unemployed are helped by the welfare state. Employment promotion, of which unemployment insurance is the most important component, finances unemployment benefits, but also short-time allowances and many other benefits for integration into the labor market. Individuals who are not eligible for employment promotion benefits can apply for benefits under the basic assistance scheme for job seekers.
Employment promotion including unemployment insurance and basic benefits for job seekers not only help with job placement, but also increase the chances of finding a new job with further training and qualification courses. This is because the goal of labor market policy is to balance supply and demand on the labor market: On the one hand, jobseekers should be able to get back into jobs subject to social insurance contributions as quickly as possible. On the other hand, companies should be able to find enough workers to meet their demand for skilled labor.
But things are not perfect anywhere: in all modern societies, including Germany, people without a job have. This cannot be completely avoided. For example, because society and technology are changing and certain occupations are becoming extinct as a result: in recent years, for example, that of miner. For several years now, the unemployment rate in the Federal Republic has been falling, and in 2019 it was five percent. Due to the effects of the Corona pandemic, there are more unemployed people again. Unemployment is expected to fall again in the next few years, however.
Not all people without a job succeed in finding their way back into working life quickly and easily. The duration of unemployment varies greatly depending on age and qualifications. The longer people are out of work, the more difficult their situation usually becomes. Because they will lose their professional connection over time if they do not have the opportunity for further training. This also makes it more difficult to find a new job. For many of those affected, the emotional strain is great: Not only can the tighter cash flow mean painful changes. Some develop the feeling of being worth less and not being needed by society. According to medical studies, mental illnesses such as depression occur more frequently in the unemployed than in the employed.
Through the crisis with short-time work
Jobs lost and stores closed: the Corona crisis had a severe impact on the labor market. Many people suddenly had much less work in their companies – or in some cases no work at all. The government and the Bundestag had to act quickly. That’s why in the spring of 2020, the so-called short-time allowance was expanded. Short-time work means that employers are allowed to reduce the working hours of their employees. But only in consultation with the works council, or if there is no works council, in consultation with the workers themselves. Accordingly, they save the salary. What employees lose in income is largely covered by the Federal Employment Agency. This applies to all employees subject to social insurance contributions, since the so-called short-time allowance is paid from the employment promotion scheme.
The advantage: the job is retained. Once the crisis is over, companies and employees can resume work in full. As a result, the labor market in Germany has weathered the Corona crisis well by international standards. The Organization of Industrialized Countries (OECD) predicts that Germany will return to the pre-Corona pandemic workforce sooner than other countries.