(Bloomberg) --
German companies' filings for state wage support suggest that about a fifth of the country's workforce will have its hours reduced.
The 55,000 applications already processed reveal plans to cut working time for over a million employees. If the same average number of workers per application is applied to the full 470,000 filings announced on Tuesday by the Federal Labor Agency, the reductions could affect around 9 million workers.
That's about 20% of the nation's workforce. In Germany, companies can apply for subsidies from the government in order to help pay staff when they have to cut or halt business activity.
“It is likely that additional applications will be received in April,” JPMorgan Chase & Co. economist Greg Fuzesi wrote in a note. “It is still difficult to say how large the reduction in hours worked is. But, it is clear that the economic hit is abrupt and large, and that short-time work is preventing millions of job losses.”
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