The German labour market is characterised by high employment stability and low dynamics due to a high degree of regulation. There are, however, important segments with low employment stability and short unemployment periods. This form of unemployment is often related to seasonal lay-offs. Due to the institutional setup of unemployment compensation in Germany, there are financial incentives to use unemployment compensation to bridge periods with low labour demand or bad weather conditions. The purpose of this project is to analyse seasonal unemployment patterns in Germany by means of microeconometric methods. It aims at stepping ahead of current research in this field by empirically analysing the effect of the business cycle and weather conditions on the incidence and length of unemployment. Moreover, the German government has conducted several policy changes during the 1990s which aimed to reduce temporary lay-offs and increase the employment stability in relevant business sectors. The project will investigate the effect of these policy changes on labour market outcomes such as employment stability and will thus provide new insights into questions of high policy relevance.