Germany's industry in crisis: 101,000 jobs lost in one year!

Germany's industry in crisis: 101,000 jobs lost in one year!

Amid the Cologne economic landscape, the mood remains subdued given the challenging market conditions. How Telepolis reported, sales of German industrial companies fell by 0.2% in the first quarter of 2023 compared to the previous year. This marks the seventh consecutive quarter of declining revenue. Particularly affected are industries such as the rubber and plastics industry, whose sales fell by 3.1%, and the textile and clothing industry, which is struggling with a decline of 2%.

The situation on the labor market is also alarming: According to surveys, over 101,000 jobs were cut in German industry in the last twelve months. These are serious numbers. The automotive industry has been particularly hard hit, with almost 45,400 jobs lost, a decline of almost 6%. Results of an EY survey show that almost a third of German industrial companies plan to relocate jobs abroad.

Structural change and jobs

The structural change in German industry is being accelerated by various factors. High energy costs, excessive bureaucracy, an acute shortage of skilled workers, poor infrastructure and an aging population are taking a toll on the industry. Loud daily news There is an increasing number of job losses in the metal, electrical and construction sectors, which indicates the beginning of deindustrialization.

Erdal Tahta, chairman of the ZF works council in Koblenz, is critical of the company's plans to cut a total of 14,000 jobs in Germany by 2028. This example is representative of a large number of companies that are struggling with difficult market situations. Bilstein is also planning to cut 200 jobs in Trier, while Eberspächer has already cut 200 jobs in other regions.

Gap between domestic demand and export situation

What is noticeable is the suboptimal development on the export market. While exports of German goods to the USA increased by 3%, exports to France fell by 5% and to China even by 15%. This stagnating demand significantly limits companies' ability to secure jobs. Telepolis also provides evidence that 84% of the managers surveyed assess the current economic situation negatively.

Although the dividends of the DAX companies in 2023 are only 0.2% below the previous year at 54 billion euros, the question arises as to whether the workforce can also benefit from this. EY expert Brorhilker warns of further job cuts and predicts at least 70,000 more jobs that could be lost by the end of the year. He calls for strengthening domestic demand and improving economic conditions in order to bring about positive change.

In summary, the pressure on German industry is growing and the challenges are enormous. If the political situation does not change promptly, this could have far-reaching consequences for Germany as a location and for its employees. The coming months will be crucial.