With US worries about unemployment running high, BusinessWeek‘s explanation of the Hungarian solution is very timely.
In the country, which has historically had a strong welfare state, only 54.6 per cent of the working age population is actually employed, the lowest number in Europe.
Prime Minister Viktor Orbán is hoping to change that.
Orban said in June Hungary will not “give benefits to those capable of work, when there is much work to be done.” Instead, there’s a new plan.
Unemployment benefits will be cut after 90 days (down from nine months). After that, the unemployed will be given a choice — work for the government in a sub-minimum wage job, or survive with zero-benefits. The money offered is twice that offered by benefits but lower than Hungary’s minimum wage.
Orban hopes that by next year 300,000 people will be in these jobs, which range from “picking up trash to building stadiums”.
The problem is whether the government can actually afford the plan…
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