As of September 2008, 173,879 of Volkswagen's workforce of 373,406 were employed in Germany. Strong union organization and strict labor laws in Germany make it difficult to layoff workers and ensure they receive generous compensation and benefits. While possibly helpful for positive morale, Germany's rigid labor market will be a challenge for Volkswagen during the global economic downturn, as the company will find it difficult to reduce costs and production to meet demand.