A government short time working scheme set up to help companies that saw their monthly turnover and orders plummet since October reduce salary costs without redundancies was opened this Sunday and already has 64 companies applying, including the steel manufacturing giant Corus. Under the scheme a company introduces mandatory worktime reductions for its staff, with the shortfall in salary paid for by unemployment benefits. For any company hit hard by the growing recession but still viable it’s a good way to cut salary costs without compulsory redundancies of employees it might very well be hardpressed to replace if the crisis proves to be only temporarily, as economists are predicting for the Netherlands.
Unfortunately however the scheme is strictly limited in both duration and resources. It ends on the first of January and it only has a budget for 200 million euros. What’s more, to be eligible for the scheme a company has to have had a thirty percent loss of turnover for at least two months, leaving a lot of other struggling companies out in the cold. Compared to the lavish treatment the banks got in the last few months, billions spent with little oversight, this seems remarkable stingy. Yes, you need banks to keep the rest of the economy in capital, but that doesn’t mean we can let other parts of the economy go to waste.