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Germany’s Job Miracle in the World Recession—Shock-Absorbing Institutions in the Manufacturing Sector

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  • Joachim Möller

Abstract

This paper aims at analyzing the Germany’s so-called job miracle in the aftermath of the World Recession. The massive downturn mainly affected export-oriented manufacturing industries. These industries have shown an astonishingly moderate employment response. Hence there is strong evidence for substantial labor hoarding. By analyzing different branches of manufacturing one can shed some light on the buffering processes that took place at the firm level. It is shown that measures of within-firm flexibility—supported by labor market instruments like short-time work schemes—prevented Germany from major dismissals and a sharp increase in the unemployment rate.

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  • Joachim Möller, 2010. "Germany’s Job Miracle in the World Recession—Shock-Absorbing Institutions in the Manufacturing Sector," Applied Economics Quarterly (formerly: Konjunkturpolitik), Duncker & Humblot, Berlin, vol. 61(Supplemen), pages 9-28.
  • Handle: RePEc:aeq:aeqaeq:v61_y2010_is_q5_p9-28
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    Cited by:

    1. Povilas Lastauskas & Julius Stakenas, 2015. "Global Perspective on Structural Labour Market Reforms in Europe," Cambridge Working Papers in Economics 1534, Faculty of Economics, University of Cambridge.
    2. Antje Mertens & Miriam Beblo, 2016. "Self-Reported Satisfaction and the Economic Crisis of 2007–2010: Or How People in the UK and Germany Perceive a Severe Cyclical Downturn," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 125(2), pages 537-565, January.

    More about this item

    Keywords

    World Recession; labor market adjustments; labor hoarding; labor market institutions; labor market reforms; business cycle; short-time work schemes;

    JEL classification:

    • J2 - Labor and Demographic Economics - - Demand and Supply of Labor
    • J6 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers

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