Are Germany’s `Minijobs’ a Poverty Trap?

[marmar]

(Bloomberg) Germany’s jobless rate has fallen to a two-decade low of 6,7 percent. Meanwhile, across the border in France, “President Francois Hollande ended his first two weeks in office with a thud,” Helene Fouquet and Mark Deen report, after jobless claims rose to the highest in 13 years.

Angela Merkel has been calling on other euro-zone countries to follow Germany’s example in reforming labor markets. One of the reasons for Germany’s success has been the so-called minijobs, Merkel says — they allow companies to take on workers at 400 euros a month for a maximum of 15 hours work per week.

Spanish newspapers haven’t been very sympathetic. El Pais entitled one of its reports “Wages of One-Euro-an-Hour in Germany’s Labor `Miracle.’” Criticism of the model has also been forthcoming in Germany. Sueddeutsche Zeitung pointed out that minijobs contribute so little to the social security system that a person working 45 years serving tables will entitle a worker to a monthly pension of just 139.95 euros. ................(more)

The complete piece is at: http://go.bloomberg.com/euro-crisis/2012-05-31/are-germanys-minijobs-a-poverty-trap/

[kcass1954]

1. We're doing the same thing with temp jobs.

A temp job used to be just that - something temporary. Twenty years ago, I temped between jobs. I spent 7 or 8 weeks at a manufacturing company, filling in for admins who were on vacation in various departments. Once everyone came back, I was gone.

Now companies (the one I work for included) routinely hire temps to avoid paying for benefits and other expenses associated with permanent workers. We have temps who have been with us for 6-8 months. They leave when they realize that there is no path to permanent status and benefits. Or when someone else offers that to them.

[Franker65]

2. Good

I mean, this has to be considered a good thing. Not ideal by any means but certainly good. Some of these jobs might be very beneficial to students, young people in summer, etc. If you look at youth unemployment statistics, Germany has the lowest in Europe. And this must be the way to go. It certainly is better than nothing.