INTERNATIONAL BUSINESS
In Germany, the Jobless Work to Keep Their Benefits
MINDEN, Germany -- In January, Benjamin Dath's eight-month search for a job in northwest Germany led him back to where he started -- the unemployment office, which ordered him to paint classrooms at a local school for just 1.50 euros ($1.89) an hour.
Mr. Dath is one of 30 men and women in Minden, a town of 83,000 about 36 miles west of Hannover, who are being forced under a new German law to paint town buildings, make sandwiches, monitor school corridors and maintain public parks to keep on receiving their monthly unemployment benefits.
''This gives me a chance to earn a little money and keep my benefits,'' said Mr. Dath, 23, who said he had bounced from a series of low-paying jobs since he dropped out of high school at 16. ''Even for 1.50 euros an hour, it's worth it.''
Across Germany, 106,000 people are currently earning 1 to 2.50 euros an hour doing mostly menial jobs, part of the government's program to compel work from the jobless to reduce the nation's 4.9 million unemployed.
For 20 hours a week, Mr. Dath applies a roller and brush to the white walls of Minden South High School, earning 126 euros a month, which he uses to augment his 320 euros in monthly jobless benefits and the 300 euros the government pays for his rent.
All together, he receives about $940 a month after taxes.
''We're still paying some of the most generous social welfare benefits in the world,'' said Wolfgang Clement, Germany's economics and labor minister, in an interview. ''The big change now is we're asking for something in return. And it's overdue.''
By the end of this year, Mr. Clement said he hoped to have placed 250,000 Germans in low-paying community jobs limited to six months -- during which time the jobless are not counted as unemployed. After their stint, they return to full benefits. Ultimately, Mr. Clement said it may be possible to place 600,000 people in such jobs, roughly the number of jobless under 25 years old who are currently unemployed.Though Mr. Dath may have found a new trajectory through the program, that is hardly the case for everyone. Hermann Dunsky, 58, is a former mechanical engineer who used to sell hydraulic and pneumatic pumps and other equipment to nuclear power plant operators until his employer, Abarle Systems of Wismar, filed for bankruptcy in 2002.
Since he lost his job in November 2002, Mr. Dunsky has applied for ''hundreds of jobs'' in Germany and even in the Netherlands, without success. When he did get a reply to his applications, Mr. Dunsky said, he was turned down because of his age. In Germany, it is legal to discriminate based on age.
Mr. Dunsky receives 660 euros a month in unemployment benefits to pay his monthly living expenses, including rent, in Schwerin, a city 60 miles east of Hamburg in the former East German state of Mecklenburg-Vorpommern, where the jobless rate was 20 percent in June.But in early May, Mr. Dunsky was called and told to report to work at a community school where he would supervise other unemployed people who are teaching 10-year-olds how to observe Schwerin's bicycle-traffic rules.
Mr. Dunsky works six hours a day at the government center, earning 1 euro an hour, 6 euros a day, 120 euros a month. He complied, he said, because, the jobless who refuse 1-euro jobs can have their unemployment compensation cut by 30 percent.
''I'm an experienced engineer,'' said Mr. Dunsky, who is divorced and lives alone. ''I can tell you that this is not the kind of work that is taxing my abilities. In fact, it is taking away the time that I need to find a real job. But I had no choice. Even so, this has been pretty hard to take.''
Gerd-Erich Neumann, the former executive director of the Association for the Unemployed in Mecklenburg-Vorpommern, a charitable group, said the 1-euro jobs were hitting many older adults hard.
''Look, this is demeaning for a lot of people,'' Mr. Neumann, who is 69, said. ''There are simply no jobs around here, and now people are being humbled for no good reason.''
It is unclear, however, whether Chancellor Gerhard Schroder's Social Democratic coalition will be in office next year to continue its labor market program. In late May, Mr. Schroder called for national elections in September, a year ahead of schedule, after his party lost power for the first time in 39 years during state elections in North Rhine-Westphalia, a poll that was seen as proxy for the national elections.
In North Rhine-Westphalia, 1.03 million people were unemployed in June -- 152,000 more than a year ago, according to government figures. In Minden and its neighboring city of Lubbecke, 12,530 people are jobless or 9.5 percent, slightly better than the national average of 11.7 percent.
Jorg Kramer, chief economist at HypoVereinsbank in Munich, said the one-euro program would do little to cut German unemployment, which Mr. Kramer expects to remain essentially unchanged through 2005. ''This will help a little, but it doesn't address the core problem,'' he said. ''This is basically a make-work program.''
Political will alone may not be enough to reduce unemployment. In Minden, retraining the community's long-term unemployed is proving costly, and local businesses, already struggling under Germany's stagnant economy, have begun complaining that the cheap labor supplied by the jobless is robbing them of scarce government contracts.
Of the 23 million euros the federal government plans to spend this year on Minden and Lubbecke's 15,724 unemployed, only 41 percent, or 9.4 million euros, will be paid out in wages to the unemployed. The majority, roughly 13.6 million euros, will go to pay for administration and to pay trainers like Peter Schwarz, a master painter supervising Mr. Dath and others at Minden South.
''What this will do is hopefully qualify people like Benjamin to be eligible some day for an apprenticeship as a painter,'' said Mr. Schwarz, 38. ''He will have a chance, but the job market for painters here at the moment isn't that great.''
Even the program's modest success is too much for Sabine and Wolfgang Noth, who have operated Maler Noth, a painting business in Minden since 1955 that employs 20 painters.
''Business had been bad enough before this program started,'' said Wolfgang Noth, who said he paid his painters about 13.50 euros an hour. The actual hourly costs, Mr. Noth said, are about 38 euros an hour when you include the costs of providing seven weeks paid vacation, 10 official paid holidays and Mr. Noth's mandatory contributions to his employees' state health insurance and pension plans.
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