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Germany's economy on the brink: Over 100,000 jobs at risk!
The German economy faces challenges in 2026: 100,000 jobs lost, profits falling, bankruptcies increasing. Prospects uncertain.
Germany's economy on the brink: Over 100,000 jobs at risk!
In the new year 2026, the situation in the German economy will worsen dramatically. While sales increased slightly in the first nine months of last year, profits plummeted. According to information from Mercury profit before taxes and interest fell by 15 percent to 102 billion euros compared to the previous year. More and more companies are looking to the coming months with concern because the uncertainties in the global economy are having an impact on the domestic market.
With sales of around 1.55 trillion euros (+0.6%), economic development fell far short of expectations. Car manufacturers were hit particularly hard. Volkswagen, BMW and Mercedes-Benz suffered a 2 percent drop in sales, while day-to-day profits fell by an alarming 46 percent to around 17.8 billion euros. Chemical companies were even faced with a 71 percent drop in profits. In contrast, IT firms and the healthcare sector saw gains of 40 and almost 100 percent, suggesting that not all industries are equally affected.
Job cuts and bankruptcies in focus
A worrying trend is emerging: a total of around 100,000 jobs have been cut since 2023, of which 17,500 were lost in the period from January to September 2025 alone. Industry is particularly hard hit, with a decline of 120,300 jobs. A survey by the German Economic Institute shows that around 36 percent of companies want to cut further jobs in 2026. Only around 18 percent plan to create new jobs, which could further exacerbate the already tense situation on the labor market.
Bankruptcies are also forecast to be at a record high. 2024 saw the highest number of bankruptcies in almost ten years, with an increase of 16.8 percent. Loud daily news A further increase is expected in 2025, which could exceed the crisis of 2009. Companies in the areas of transport, storage, construction and hospitality are particularly suffering from the economic conditions.
The mood in the company
Nervousness in the corporate landscape remains high. Loud Entrepreneur Savior In the industrial sector, 41 percent of companies are planning to cut staff. The withdrawal of investments and the lack of confidence in future higher production play a decisive role here. At the same time, only 23 percent of companies report that they want to invest more in 2026 than in the previous year.
The reasons for this gloomy outlook are manifold: high energy prices, disrupted supply chains and a stagnating global economy are creating a tense market. There are also noticeable regional differences in the mood of companies. While there is optimism in the north and Bavaria, pessimism dominates in the northeast.Over a third of companies are planning to cut jobs, which could further worsen the employment situation.
The future of the German economy is uncertain. The challenges of the political and economic conditions are enormous. The demand for an improvement in location conditions and investment incentives is becoming louder. However, robust economic growth does not appear to be in sight in the foreseeable future. The federal government expects moderate GDP growth for 2026, which may not be enough to solve the existing problems.