Gloucester Engineering Co. Inc. is among the companies that are saving money by participating in a federal program called WorkSharing, where full-time employees are scaled back to part-time status, and the government pays them unemployment benefits for the hours they're not at work. This story (and audio report) from WBUR radio in Boston explains the plan.

Gloucester, which went through a management buyout in October, is paying some workers to come in four days a week instead of five. They "keep full benefits: health care and 401ks. But for the fifth day they're not on the job, they collect unemployment from the state," according to the report.

The story quotes Edward Malmborg from the Massachusetts Division of Unemployment Assistance, who notes that WorkSharing does not appear to drain the state's pool of unemployment money any more (or less) than conventional layoffs.

This is an interesting way to cut costs. I've seen other stories in the past few months about companies changing shifts to improve efficiency, but this is the first time I've heard about the WorkSharing program. Are there other plastics companies that have tried this strategy?