(Bloomberg) — Almost half a million Germans applied for financial aid under a government support program in March, when factories and other businesses were forced to shut because of the coronavirus outbreak, the Labor Ministry said on Tuesday.
The pandemic sparked thousands of furloughs in Europe’s largest economy, a development echoed across the continent. Figures published Tuesday showed 470,000 sought kurzarbeit, a form of state wage support, this month.
The measure allows businesses to reduce workers’ hours or halt production while still paying them with the help of government salary subsidies.
Carmakers Volkswagen (DE:) AG and Daimler AG (DE:) and sports-apparel maker Puma SE are among those planning to idle tens of thousands of staff. Even financial institutions like Deutsche Bank AG (DE:) are considering such moves.
Figures published earlier on Tuesday showed little change in the number of people officially out of work in March. However, that report was only based on data available through March 12 and fails to capture the impact of the lockdown.
Economists warn that a recession in Germany is unavoidable. Even if most measures aimed at containing the virus are lifted in mid-May, allowing the economy to recover through the summer, output is expected to shrink by 2.8% this year, according to a report published by government advisers on Monday.
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.
Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.