The Kurzarbeit model and the sustainable development of Romania Is Romania ready for this model?

Abstract

The Kurzarbeit model was applied by several European governments during the previous crisis of 2008-2009 and involved the design of small state-funded work schemes. Governments have supported subsidized companies to compensate for the loss of revenue. Adapting the model to the crisis has been much easier in countries where regulation already exists, compared to the countries that adopted it for the first time. The efficiency of the model was different, with the best results being obtained by countries that had robust economies before the crisis. Overall, at the level of countries that have applied this model, it can be said that the model provided job stability during the crisis, not the certainty that workers will keep their jobs even after the crisis. Given the recent decision of the Romanian Government to apply the Kurzarbeit measure in our country as well, in the current study we considered the analysis of those issues that affected the countries that adopted this model for the first time, in the previous crisis, at which we added the unprecedented impact of the recent pandemic and the particular aspects that characterize today’s Romanian economy. The results show that, without analyzing the particularities that differentiate Romania from the countries that have successfully applied the model, the Kurzarbeit model will not ensure the sustainable development of the social factor and the employment rate assumed for 2020, and social inequalities and poverty will continue to deepen.