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Short-Time Compensation as a Tool to Mitigate Job Loss?

July 14, 2014 09:00 AM

During the recent recession only 17 states offered short-time compensation (STC)—pro-rated unemployment benefits for workers whose hours are reduced for economic reasons. New federal legislation will encourage the expansion of STC. In this paper, authors Katharine G. Abraham, University of Maryland, and Susan N. Houseman, Upjohn Institute for Employment Research, present new evidence indicating that jobs saved during the recession as a consequence of STC could have been significant in manufacturing, but that the overall scale of the STC program was generally too small to have substantially mitigated aggregate job losses in the 17 states. Expansion of the program is necessary for STC to be an effective counter-cyclical tool in the future.

Download and read the entire paper from APPAM's Online Paper Collection, a selected cross section of papers presented at the 2013 Fall Research Conference in Washington, D.C. last November.

Download the PDF.

 

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