GERMANY has taken the decision to extend its furlough scheme for 12 months, notwithstanding the reservations by a number of German politicians at the potential bill of €30 million.
The job support scheme, which has assisted workers whose income had been adversely affected by the coronavirus pandemic and subsequent lockdown, will continue in an effort to shore up the German economy which shrank by 9.7 per cent in the second quarter of the year. This being a much lower figure than that of the likes of the UK who saw their economy contract by 20.4 per cent.
At the peak of the pandemic approximately 10.1 million workers were furloughed in Germany.
Further economic measures will include an extension of government loans for short and mid-sized businesses until the end of the year.
Finance Minister, Olaf Scholz, praised his countries handling of the economic repercussions of the pandemic, stating, “The fact that we acted fast and big has resulted in Germany weathering the crisis much better than others.”
At the same time as Germany extends its furlough scheme, the UK government is in the stages of winding its own furlough scheme down. At its height, the scheme saw four million people receiving assistance. This has prompted the Labour party to challenge the UK governments decision.
There are deep seated fears that a swift blanket withdrawal of the furlough scheme in the UK will see a sudden rise in unemployment and put unnecessary pressure on its already struggling businesses and the economy as a whole.