Cluster-Seminar Public Finances and Living Conditions

In the recent economic crises, Germany has made use of job retention schemes and in particular short-time work benefits ('Kurzarbeit') to tackle shocks in labor demand. Under these schemes, workers have not been laid off and received unemployment benefits, but reduced their working hours (or stopped working) for a limited amount of time while receiving short-time leave benefits. While the effect of short-time work on an individual's working hours is similar to involuntary unemployment, the financial effect is not: workers on short-time work know that after a limited amount of time, they will return to their previous job and hence do not face the same economic uncertainties as unemployed individuals do. The negative effect of unemployment on individual career trajectories has been widely established in the literature. However, this literature has focused almost exclusively on the experience of men. In this project, we evaluate and compare the impact of unemployment and short-time work on the careers of men and women and on the gender division of unpaid care work within families. We apply an event study design to track women and men before and after their labor market shock. For our analysis we use the German Socio-Economic Panel (GSOEP). We also plan to use the survey link to administrative-matched employer-employee data (GSOEP-ADIAB). This provides the unique opportunity to account for the full employment history of the individuals and to consider firm-specific characteristics, going forward. Our preliminary findings align with existing literature, indicating a more challenging labor market recovery for women compared to men following abrupt unemployment events, alongside a temporary increase in fathers' engagement in care work that diminishes upon re-employment. While especially women with children experience a persistent long-term increase in care responsibilities, we observe comparable employment stability between men and women under short-time work arrangements and no discernible impact on unpaid care work.