Minister: job retention scheme ends 30 June

There is disagreement within the government on whether job retention scheme, which formed the bulk of corona rescue package 1, should be extended.

The scheme, administered by the ALS employment service, supports companies hit by the corona crisis by temporarily helping to pay the wages of people who cannot do their jobs, thus allowing employees to stay on the payroll despite not working due to the lockdown.

Some government MPs say it is too early to close down the scheme when almost 2,000 people are relying on it as their only source of income.

But trade minister Helgi Abrahamsen disagrees:

 >> SEE ALSO More than 4,000 sign up for job retention scheme

“If people are to continue receiving benefits from ALS, they should either be transferred to the regular unemployment benefits system or they just find another job, rather than continue being associated with an employer who cannot offer them work,” he said yesterday.

He added that simply extending the existing job retention scheme would involve a risk of the Faroese society ending up importing workers from abroad while a large proportion of the Faroese workforce people is unemployed.

 >> SEE ALSO Full-time unemployment up by half since outbreak

The job retention scheme has so far cost ALS almost DKK 100 million.

People making use of this scheme are not registered as unemployed, i.e. are not listed as being available for other jobs.

This means that although almost 2,000 people are not currently in jobs, the Faroese unemployment rate is below 2 percent.

According to ALS CEO Magni á Deild, many of those currently in the job retention scheme will probably return to their old jobs or find new jobs soon rather than being transferred to the regular unemployment system.

However, as not everyone is expected to return to their old job or find a new job, the unemployment rate will inevitably rise when this scheme expires. And this will affect the degree to which Faroese companies can hire foreign workers.

Translated by prosa.fo