Germany Puts Easterners to Work Job-Creation Program Seen as Stabilizing Unemployment after Private Initiatives Failed

Article excerpt

THORSTEN BLOSSEY, an east German trained as a draftsman, found himself unemployed last January. He thought he could join a western engineering firm, but then heard his skills weren't up to par. He considered further training, but found himself competing with 120 people for 20 slots. For five months, says the 26-year-old, he "jobbed around" in Berlin.

In June, he was hired under Germany's job-creation program and now works in Potsdam's office of historic preservation. The former capital of Prussia, Potsdam is rich in architecture but badly decayed. Mr. Blossey says he "feels great" in his new job, in which he photographs, sketches, and then removes architectural detail from buildings for restoration.

Under the communists, Potsdam employed three people to oversee the city's world-renowned historic treasures. Now there are 30, half of whom owe their jobs to Germany's job-creation program.

Government-sponsored jobs now account for about 23 percent of all new jobs in east Germany. According to labor specialists, these jobs are having an impact on unemployment, which began to stabilize in August.

An American-style "New Deal," in which the government creates jobs by sponsoring major public works programs, was not what Bonn had in mind when it undertook the integration of the East and West German economies. The government assumed private investors would rush east, snap up bargains, build new factories, and solve the unemployment problem on their own.

But the private sector got off to a slow start. The economy in the east was more decrepit than estimated. No one knew who had title to land, so no one bought property. No one wanted responsibility for environmental clean-up of old factory sites, so no one invested. Last winter, Bonn was forced to fund job-creation programs.

The programs wobbled at first. Many east Germans were unaware they qualified for these government-sponsored jobs, and local administrators were unprepared to advise them. But by September, east Germany had created and filled the 280,000 job slots budgeted at $3 billion for this year. Germany's Federal Employment Office is now scrambling to fund an extra 120,000 jobs by year's end, and is requiring the east German states to chip in for wages instead of depending solely on the federal government.

Regine Hildebrandt, labor minister for the east German state of Brandenburg, says that the job-creation measures are beginning to slow unemployment. …