Workshare programs to retain skilled workers during downturns and impact

An article in Bloombergbusinessweek (January 28, 2013) describes the impact of work share programs that enable access to Federal funds to support a fraction (70 % or so) of a worker’s wages when the employee works at least 40 % or more of usual hours. An example company cited is Saint Gobain, a producer of plastics, whose employees availed of the program by working 70% of usual hours temporarily until the economy improved. Will such rollbacks of working hours supported by Federal support generate the estimated $1.64 for every $1 invested ? Or will it just postpone the hard capacity reduction decisions that are necessary because of the distortion caused by the government subsidy ?

About aviyer2010

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