Germany’s response measures to the COVID-19 pandemic

Germany – as practically all countries worldwide – has taken a wide range of reactive measures to deal with the COVID-19 pandemic. Particular attention is paid to measures in the Dual VET sector, where an extensive support package has been put into place. Its aim is to incentivize companies, particularly SMEs (small or medium-sized enterprises), to continue their efforts in the Dual VET system despite facing economic difficulties and counteract on the tendency to reduce training places in times of crisis.

A central aspect of the stabilization measures is the federal programme to secure apprenticeships, which has a volume of up to 500 million Euros. The Federal government, Federal Agency for Employment, the states (Länder), employer organizations as well as unions have jointly formed an "Alliance for VET", which observes the situation of the economy and the companies with regards to vocational training. They agreed on the following financial incentives:

(1) A bonus payment (2.000 € per trainee) for SMEs (economically effected by the COVID-19 crisis), which keep their apprenticeship placements stable in the next year;

(2) A bonus payment (one-off payment 3.000 €) for SMEs (economically affected by Covid-19 crisis), which increase their apprenticeship placements in the next year;

(3) Financial support for SMEs (economically affected by Covid-19 crisis), which do not opt for short-time work for their in-company trainers (and thereby continue in-company training without restrictions), up to 75% of the trainer’s salary;

(4) The advancement of collaborative training for trainees in SMEs, which cannot continue training in their respective companies due to the pandemic and are given the opportunity to continue in another SME (the in-taking company receives a bonus payment, yet to be defined); 

(5) A bonus payment (3.000 € per trainee) for SMEs, which take over trainees from insolvent companies that cannot continue to provide training.

Generally, Germany’s national COVID-19 response measures for the economy and labour market have been applied in two steps:

The government measures in step 1 (during the COVID-19 outbreak) were focused on immediate alleviation measures, i. e. providing credit, guarantees and direct financial aid to support business, self-employed workers and employees to survive the lockdown of parts of the economy and the subsequent loss of income. Parts of the measures were directly provided by the central state, some through the federal states and were thus different, depending on the respective state (Land).

In step 2 (after the lockdown), measures have been intended to secure employment, to enable a speedy recovery of Germany’s economy and to strengthen the federal states and municipalities through a “Fiscal Stimulus and Crisis Management Programme” (with a volume of 130 billion Euros and 57 single measures). These step 2 measures include e. g. a reduction of VAT by three percentage points, direct financial support of municipalities, investments in infrastructure and further actions.