RIGHT DIRECTION, EXCEPT THEY'RE ONLY PRODUCTIVE 20% OF THE WEEK:

One simple reform would make life easier for employers who don't want to fire anyone but need to reduce their expenditures. If a firm wants to cut its wage costs by 20 percent, it can fire one-fifth of its workers, or it can tell all its workers to stay home on Fridays without pay. In the latter case, under an option called work-sharing that is available in many places but remains little used, workers would be eligible to receive one-fifth of their unemployment-insurance (UI) benefit. The cost to taxpayers would be the same under the two scenarios. In most cases, the UI benefit would be less than the lost wages, typically around half, so work-sharing would amount to a pay cut (in this case, one of around 10 percent), but workers would stay employed and retain their benefits.

Work-sharing reduces what economists call "inefficient separations." It allows firms to weather a lull in demand without losing the firm-specific expertise present in their existing work forces; it spares firms the time and expense of hiring and training new workers when demand picks back up; and it prevents workers from losing or failing to acquire skills during a period of unemployment. Unfortunately, in many cases employers do not even consider work-sharing because they have never heard of it. A limited but active program to keep Americans working might include expanding, supporting, and publicizing work-sharing UI programs.

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