Generous furlough schemes in France and Germany have attracted crooks, such as claims being made for more than employees earn
economists, the model for a covid-19 furlough scheme has been Germany’s. It already had a good record, managing to avoid big job losses during the global financial crisis of 2008-09. Then, the German government paid the bulk of wages of people who had temporarily stopped working, rather than letting their employers fire them altogether. It did not prevent a nasty recession, but remarkably few jobs were lost.”—both yes and no. First of all, is being tested on an unprecedented scale.
The German scheme has been doing the trick. The registered unemployment rate rose to 6.3% in May, up from 5.8% in April. But mass lay-offs have been avoided. The same goes for furlough programmes in France, Italy, the Netherlands and Spain. France’swas benefiting 8.6m workers at the end of April. The state pays up to 84% of net salary, to a ceiling of €4,608 a month. Employees on the minimum wage still get the full amount.
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