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Some surprising facts about working time accounts and the business cycle in Germany

Author

Listed:
  • Almut Balleer
  • Britta Gehrke
  • Christian Merkl

Abstract

Purpose - Working time accounts (WTAs) allow firms to smooth hours worked over time. The purpose of this paper is to analyze whether this increase in flexibility has also affected how firms adjust employment in Germany over the business cycle. Design/methodology/approach - This paper uses rich microeconomic panel data and fixed effects estimations to compare the employment adjustment of firms with and without WTAs. Findings - The authors show that firms with WTAs show a similar separation and hiring behavior in response to revenue changes as firms without WTAs. One possible explanation is that firms without WTAs used short-time work (STW) to adjust hours worked instead. However, the authors find that firms with WTAs use STW more than firms without WTAs. Originality/value - These findings call into question the popular hypothesis that WTAs were the key driver of the unusually small increase in German unemployment in the Great Recession.

Suggested Citation

  • Almut Balleer & Britta Gehrke & Christian Merkl, 2017. "Some surprising facts about working time accounts and the business cycle in Germany," International Journal of Manpower, Emerald Group Publishing Limited, vol. 38(7), pages 940-953, October.
    • Handle: RePEc:eme:ijmpps:ijm-05-2017-0100
    DOI: 10.1108/IJM-05-2017-0100
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    Citations

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    Cited by:

    1. Ellguth, Peter & Gerner, Hans-Dieter & Zapf, Ines, 2018. "Arbeitszeitkonten in Betrieben und Verwaltungen: Flexible Arbeitszeitgestaltung wird immer wichtiger (Flexible working times become more and more important)," IAB-Kurzbericht 201815, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    2. Hutter, Christian & Klinger, Sabine & Trenkler, Carsten & Weber, Enzo, 2019. "Which factors are behind Germany's labour market upswing?," IAB-Discussion Paper 201920, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    3. Andrey Launov, 2021. "Working Time Accounts and Turnover," Scandinavian Journal of Economics, Wiley Blackwell, vol. 123(3), pages 1025-1056, July.
    4. Ghosh, Sugata & Mitra, Anirban, 2022. "Ethnic identities, public spending and political regimes," Journal of Comparative Economics, Elsevier, vol. 50(1), pages 256-279.
    5. Zapf, Ines, 2018. "Verbreitung und betriebliche Bestimmungsfaktoren von Arbeitszeitkonten [Distribution of working-time accounts and its establishment-specific determinants]," Industrielle Beziehungen. Zeitschrift für Arbeit, Organisation und Management, Verlag Barbara Budrich, vol. 25(1), pages 51-81.
    6. Balleer, Almut & Arabzadeh Jamali, Hamzeh & Gehrke, Britta, 2020. "Uncovering the mechanism(s): Financial constraints and wages," CEPR Discussion Papers 15585, C.E.P.R. Discussion Papers.
    7. Alexander Herzog-Stein & Patrick Nuess & Lennert Peede & Ulrike Stein, 2021. "Germanys Labour Market in Coronavirus Distress New Challenges to Safeguarding Employment," IMK Working Paper 209-2021, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.

    More about this item

    Keywords

    Business cycles; Short-time work; Working time accounts; E20; E24; J20; J30;
    All these keywords.

    JEL classification:

    • E20 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - General (includes Measurement and Data)
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J20 - Labor and Demographic Economics - - Demand and Supply of Labor - - - General
    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General

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