Addressing the Employment Effects of the Financial Crisis : The Role of Wage Subsidies and Reduced Work Schedules

This note briefly reviews the experiences with wage subsidies and reduced work schedules in promoting employment and avoiding the depreciation of accumulated skills and knowledge due to a temporary downturn. These policies have been adopted by many high income countries as well as some middle income countries. It is to early o comment on their impact; to date, they have not been rigorously evaluated in the context of the financial crisis. And any results will also be difficult to generalize, since much depends on local conditions and the structure of the labor market. Wage subsidies and reduced work schedules show some promise as measures that can help countries to increase the employment elasticity of growth during the recovery and avoid the depreciation of skills associated with unemployment or informal work. Wage subsidies and reduced work schedules mainly benefit formal sector workers, which represent less than 50 percent of the labor force in most middle and low income countries.

Bibliographic Details

Main Authors:	Robalino, David, Banerji, Arup
Format:	Brief biblioteca
Language:	English
Published:	World Bank, Washington, DC 2009-09
Subjects:	ACTIVE LABOR, ACTIVE LABOR MARKET, ACTIVE LABOR MARKET POLICIES, ACTIVE LABOR MARKET PROGRAMS, AGGREGATE EMPLOYMENT, BORROWING, COLLECTIVE BARGAINING, CONTRIBUTION RATE, DISABILITY, DISABLED WORKERS, DISADVANTAGED GROUPS, ECONOMIC SLOWDOWN, ECONOMICS, EMPLOYABILITY, EMPLOYEE, EMPLOYEE BENEFITS, EMPLOYER CONTRIBUTION, EMPLOYER CONTRIBUTIONS, EMPLOYERS ORGANIZATIONS, EMPLOYMENT, EMPLOYMENT CREATION, EMPLOYMENT EFFECTS, EMPLOYMENT OUTLOOK, EMPLOYMENT POLICY, EMPLOYMENT SERVICES, EMPLOYMENT SUBSIDY, FORMAL SECTOR WORKERS, GOVERNMENT SUBSIDIES, HEALTH INSURANCE, HUMAN CAPITAL, HUMAN RESOURCES, HUMAN RESOURCES MANAGEMENT, INCOME, INCOME TAX, INFORMAL SECTOR, INFORMAL SECTOR WORKERS, JOB COUNSELING, JOB DESTRUCTION, JOB TENURE, JOBS, JOBS CRISIS, LABOR DEMAND, LABOR FORCE, LABOR MARKET, LABOR MARKET ADJUSTMENT, LABOR MARKET FLEXIBILITY, LABOR MARKET POLICIES, LABOR MARKET RIGIDITIES, LABOR MARKETS, LABOR ORGANIZATION, LABOR TURNOVER, LABOUR, LABOUR COSTS, LAYOFFS, LONG TERM UNEMPLOYMENT, LOW-WAGE EMPLOYMENT, MINIMUM WAGE, PAID WORKERS, PAYROLL TAXES, PENSION SYSTEMS, PRODUCTIVITY, PUBLIC WORKS, REGULAR JOBS, SELF EMPLOYMENT, SEVERANCE PAY, SHORT-TERM TRAINING, SOCIAL PROTECTION, SOCIAL SECURITY, SUBSIDIZED EMPLOYMENT, SUBSIDIZED TRAINING, TAX CREDITS, TEMPORARY EMPLOYMENT, TRAINING PROGRAMS, TRAINING STIPENDS, UNEMPLOYED, UNEMPLOYED PEOPLE, UNEMPLOYED WORKERS, UNEMPLOYMENT, UNEMPLOYMENT BENEFIT, UNEMPLOYMENT BENEFITS, UNEMPLOYMENT INSURANCE, UNEMPLOYMENT INSURANCE SYSTEM, UNFUNDED LIABILITIES, UNSKILLED WORKERS, WAGE EMPLOYMENT SUBSIDIES, WAGE INCREASES, WAGE LOSS, WAGE LOSSES, WAGE SUBSIDIES, WAGE SUBSIDY, WAGE SUBSIDY PROGRAMS, WAGES, WORK ORGANIZATION, WORK SHARING, WORKERS, WORKING, WORKING HOURS, YOUNG WORKERS,
Online Access:	http://documents.worldbank.org/curated/en/2009/09/12431151/addressing-employment-effects-financial-crisis-role-wage-subsidies-reduced-work-schedules http://hdl.handle.net/10986/11717
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