"Kurzarbeit" is a German expression that essentially means, "We're cutting your hours, but we're not laying you off." It's an imperfect solution to a nagging problem in a world beset by economic stagnation, flagging manufacturing, and, in the US, massive layoffs and the waste of "human capital."
Rather than sacking loyal, trained workers, many struggling German companies simply cut the hours of all employees in order to preserve jobs and, ultimately, the enterprise. On days when they don't work, employees attend training sessions. German workers are treated as assets, not "overhead," and German managers are making a bet -- sticking out their necks -- in hopes that new orders will come in, and an economic recovery will indeed come.
Everyone is in the same boat. Labor-management negotiations are sometimes contentious, but both sides know they must live with the other. The result is consensus. While work weeks are reduced under the German system, few lose their livelihoods. Everyone has a reason to get out of bed each morning and go to work.
Especially for US engineers, it's grim to contemplate the sheer amount of expertise and wisdom lost as companies have shed thousands of skilled workers during the Great Recession of 2008. Despite the bottom-line mentality of managers, American engineers and workers remain the most productive in the world.
One thing is clear: Any nation that wishes to remain competitive in global technology and manufacturing must nurture its workforce. In our 40th anniversary year, this publication is championing the revival of US manufacturing. We can learn from the Germans and their enlightened policies for treating skilled workers with respect while preserving jobs and the dignity of work. The result there has been the nurturing of German industries, most of which have survived and prospered in the middle of a European sovereign debt crisis.
Some readers will counter: What? Adopt a German system just this side of socialism? True, labor costs may be higher in Germany, but Deutschland remains perhaps the only growing economy in Europe, a bastion of stability on a continent wracked with economic angst. And German manufacturing quality remains superior because workers are well-trained and maintain a largely optimistic view of the future. Job security makes workers more productive.
Still, notes a friend of EE Times who survived the worst days in Germany after World War II and prospered under its post-war vocational system, "there is no free lunch in Germany."
I suppose I risk being lumped in the "socialist" category when I say I'm all behind this idea of Kurzarbeit, whether it's following the German's lead or just applying some basic common sense. My husband owns a small business and a couple of years ago when things got tight, he put into play a similar practice and had all existing employees go to an abbreviated work week obvioulsy with a reduced pay scale. Difficult for all, but better than seeing some of their trusted colleagues hit the chopping block. When business improved, the hours were reinstated and the team moved on from there.
I would hope in this day and age of economic and job uncertainly, employees would value this philosophy and make it their goal to be as productive and loyal as possible. Then it can be a win-win for both sides.
During a recession in the 1970s, Hewlett-Packard cut the employee work week and pay by 10% to save jobs. When the economy improved, the work week and pay were restored to 100%. It worked for HP; most employees preferred to "tighten their belts" and keep their jobs.
Employees have a right to view this concept with a bit of skepticism; the concept is almost unheard of in this country. Labor is one of the highest costs to a business; axing people when times get tight is the easiest, if not smartest, thing to do to maintain that bottom line.
Workers would seem to be just another commodity, managers can always get more.
One way companies might improve their image is to not seek H-1B visa workers any more. This concept (training during slow times) is an honest approach, H-1B is not.
The concept proposed would be a breath of fresh air.
There is one trusim that I have never found not to apply: Management always does what is easy. There are probably a hundred different things that management can do when business begins to fall off, the easiest one is the layoff. It doesn't really take a lot of effort for a layoff, in fact, most of the time I've detected a randomness to the selections as if management took no time to discover who contributes. Generally the pattern is who makes the most money or who's the oldest.
Given past experience, this German method is way past the intelligence level of US management. It's way too much effort.
True, but not in such a destructive way as management. When we do our processes that create the product, we try to make things as simple as possible but we don't compromise performance. We examine the impact of our changes, I've rarely seen management do that. I cannot count the number of times I've heard "We'll monitor the situation" or "We'll see what happens." After that point, action is never taken.
TJ, I agree with you on this one. While the concept seems to have appealing aspects, it could add to an underlying resentment among some workers. The drive to achieving productivity and excellence is also not completely linked to time worked.
Great example, Beth. I have recently heard stories about fewer workers leaving their jobs because they know how tough the job market has become. One report called them "disgruntled" workers, read: unproductive. It seems to be any business owner worth his/her salt can determine whether or not to keep a productive worker in good times and bad.
The H-1B issue is a separate can of worms in this debate. While I understand that we don't want to lose engineers trained in the U.S. at great expense, I still find it very hard to believe that employers can't find at least some of the same skills within the existing U.S. workforce.
I tried to do something like this at a previous job. I had an extremely highly skilled technician who I had been training to take on more and more responsibility. Unfortunately, he also had the least amount of seniority, so when it came time to make layoffs, he was the first on the list. It seemed to like a bad idea to lay him off after investing so much time in training him, so I thought perhaps I could work out some kind of Kurzarbeit scheme. This was a mistake. Upper management thought I was being soft-hearted, and the union thought I was trying to screw them. In the end, I had to lay him off. As I had suspected, by the time the company started recalling laid-off workers, he had found another, better job.
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