Nearly 20 per cent of the country's employees are partially unemployed due to Covid-19

Guy Parmelin, 1st April 2020. | Keystone / Alessandro della Valle

We have exceptionally decided to make this article available free of charge to all our readers, as this data is extremely important for a proper response to, and understanding of, the current epidemic.

"19.6% of the Swiss workforce is partially unemployed." Guy Parmelin, the Federal Councillor for Economic Affairs, explained the effect of the measures taken to combat the coronavirus epidemic in the country. At the Federal Council's press conference on 1 April, various additional measures and assistance were announced, in particular for the self-employed. Karin Keller-Sutter, Federal Councillor for Justice and Police, also announced measures concerning the right of asylum.

Why it matters. The impact of the crisis generated by the Covid-19 epidemic on the real economy and jobs is quantified for the first time by the Federal Council. The effect is colossal: as of 31 March, more than 86,000 companies have filed applications for compensation for reduced working hours (partial unemployment), affecting more than one million employees in the country.

The state of affairs, 31 March 2020. Guy Parmelin provided figures on the various measures put in place to support companies, employees and the self-employed.

  • 119 banks participate in the Covid-19 collateral loan program.

  • More than 53,750 credit agreements have been concluded for an average sum of 198,000 francs, with an estimated total volume of 10.6 billion francs.

  • More than 86,190 companies have submitted applications for compensation of reduced working hours (short-time working), for a total of more than 1,017,359 million employees, i.e. 19.6% of the Swiss workforce.

In view of the number of applications and the burden that they represent to state finances, the Federal Council wishes to continue its current strategy. Guy Parmelin stated that:

"We are in the middle of a crisis. It is not a question of maintaining the lifestyle of the population, but of ensuring the survival of the most vulnerable and enabling them to get through this crisis. The Federal Council notes that the measures announced have been implemented quickly and that applications for various forms of aid are being processed quickly, efficiently and without excessive bureaucratic burden."

The strategy. The Federal Council's main goal is to protect the health of the population. In order to achieve this, these objectives are maintained:

  • To protect jobs

  • To guarantee salaries

  • To help the self-employed

  • To avoid insolvencies due to a lack of liquidity

Independent workers. In order to support the self-employed, the Federal Council has also decided to extend its support measures to certain categories that currently "fall through the cracks". Guy Parmelin highlighted that:

"There are 330,000 self-employed people in Switzerland. Around 270,000 of them are not eligible for coronavirus compensation for loss of earnings. This compensation was only designed for those professions directly affected by a ban on practising.

These self-employed persons are destitute and to help them, an extension of compensation to these categories is under consideration. Home helpers, people working on call, and people in the fields of culture, sport and start-ups are particularly vulnerable."

The Federal Council does not want general, non-refundable coverage. The financial needs of such an approach would put federal finances at risk, especially if the crisis were to last. Moreover, according to the Federal Council, this approach would have a negative impact on the attractiveness of Switzerland as a business location.

Finding a balance. The current economic year requires interests to be balanced. The Federal Council must find "a balance between existing measures and the additional aid needed", said Guy Parmelin. Objectives to be balanced:

  • To meet the immediate and vital needs of companies, employees and the self-employed

  • To maintain sufficient room for manoeuvre to cover the entire duration of the crisis

  • To safeguard the sustainability of public finances in order to ensure economic recovery

Asylum. Karin Keller-Sutter, Federal Councillor for Justice and Police, also announced several decisions concerning asylum seekers:

  • Asylum procedures are temporarily modified

  • Time limits for appeals and referrals are extended

  • Accommodation capacities will be increased (with respect to rules of hygiene, and especially social distancing)

Article translated from French by Boroka Zita Godley.