ZURICH: Swiss mechanical and electrical engineering companies have called for the country's short-time working compensation scheme to be extended to 24 months to prevent more job losses in a sector hit hard by the coronavirus pandemic.

Many companies were already using the government programme at the start of 2020 and are now approaching the 18-month limit for the scheme, which pays a portion of the wages for furloughed workers, industry association Swissmem said on Wednesday.

"The maximum period for short-time work compensation needs to be raised to 24 months," said Martin Hirzel, president of Swissmem. "It is essential to avoid further pandemic-related job losses at companies that have been hit particularly hard."

Swissmem said annual orders for its members fell by 6.5% in 2020 compared with a year earlier, while sales fell 9.8%. The number of people working in the sector fell by 2% to 319,300.

Short-time working has helped keep Swiss unemployment low at 3.7% despite the economy suffering its worst downturn in decades.

The government ramped up spending on the measure to 10.8 billion Swiss francs ($11.90 billion) in 2020, contributing to Bern's biggest ever budget deficit of 15.8 billion francs.