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Financial Times: US should learn from Germany on jobs

»The German unemployment rate has remained consistently below that of the US since 2008 while, at the same time, the participation rate has increased slightly due to the increased presence of women and elderly workers. How did Germany do this and what are the lessons for the US? The roots of Germany’s transformation go back to 2003 when Chancellor Gerhard Schroder introduced the “Hartz reforms”. Forced to act by a sluggish economy at the beginning of the decade, and an unemployment rate of 10 per cent in 2002, Germany implemented bold measures. The objectives of the new measures can be summarised as encouraging the search for jobs rather than providing generous benefits that would discourage the acceptance of offered positions; providing incentives to employees to retrain and acquire skills more in demand; and reducing the social security burden on employers.«

 

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