Job Security in America: Lessons from Germany
With the onset of the recession in 1990, job security has moved to the forefront of labor market concerns in the United States. During economic downturns, American employers rely heavily on layoffs to cut their work force, much more than do their counterparts in other industrialized nations. The hardships imposed by these layoffs have led many to question whether the U.S. workers can be offered more secure employment without burdening the companies that employ them. In this book, Katharine Abraham and Susan Houseman address this question by comparing labor adjustment practices in the United States, whether existing policies arguably encourage layoffs, with those in Germany, a county with much stronger job protection for workers. From their assessment of the German experience, the authors recommend new public policies that promote alternatives to layoffs and help reduce unemployment. Beginning with an overview of the labor markets in Germany and the United States, Abraham and Houseman emphasize the interaction of various labor market policies. Stronger job security in Germany has been accomplished by an unemployment insurance system that deters layoffs. In the U.S., the unemployment insurance system has encouraged layoffs while discouraging the use of work-sharing schemes. The authors examine the effects of job security on the efficiency and equity of labor market adjustment and review trends in U.S. policy. Finally, the authors recommend reforms of the U.S. unemployment insurance system that include stronger experience rating and an expansion of short-term compensation programs. They also point to the critical link between job security and the system of worker training in Germany, and advocate policies that would encourage more training by U.S. companies.
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Overview of the Book
Industrial Relations in the United States
The Effects of Institutions on Labor Market Adjustment
An Overview of Labor Market Performance in Germany and the United States
Macroeconomic Trends in the 1970s and 1980s
The Causes of High German Unemployment
The Distributional Effects of Labor Adjustment Policies
Distributional Effects by Demographic Group
Lessons for US Policy
Trends in US Policy
New Directions for US Policy
Technical Appendix to Chapter 4
Employment Protection Laws as a Cause of Unemployment
The Effects of Job Security on Labor Adjustment
Movements in Employment Hours and Shipments
Employment and Hours Adjustment
ShortTime Work versus Temporary Layoffs
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addition advance notice allow apprenticeship associated average benefits changes chapter collective companies compared compensation costs council countries cyclical decline demand differences discussion dismissal distribution downturns early retirement economy effects elasticities employed employers employment employment adjustment equations establishments estimates evidence expect experience female figures firms foreign German greater groups growth higher hiring important increase individuals industries institutions job security labor adjustment labor force participation labor market least less male manufacturing measure ment models months negotiated Nonproduction workers older percent period persons policies practices production employment Production workers programs protection quarters reasons receive recent reduce relatively reported response sector seniority sharing shipments short short-time significant social Statistics STC programs suggest survey temporary layoffs trend typically unemployed unemployment insurance unemployment rate unions United wages weeks women
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