In its latest job report on March 31, Germany’s Federal Employment Agency (BA), announced that German industry lost around 120,000 jobs in the last 12 months.
Small and medium-sized companies with fewer than 250 employees were hardest hit.
Employment in German industry has been declining month by month since August 2023
While 6.79 million were employed in the manufacturing sector in January 2024, the figure was 6.67 million in January 2025, according to the projections of the statistics of the Federal Employment Agency.
The employers’ association called the situation “alarming” and highlighted the need for a change of policy.
“The manufacturing sector reacts more strongly to the economy than other sectors of the economy”, the BA noted pointing to the COVID pandemic in 2020 and the financial crisis in 2009, when the number of employees in the manufacturing sector fell more sharply than in most other sectors of the economy.
“The persistently weak economic situation is increasing the pressure for transformation and exposing the need for structural change.”
They noted an increased use of short-time work, which, according to the BA, reflected the current economic weakness of Germany.
The number of unemployment registrations from the manufacturing sector was also significantly higher in 2024 than in previous years, at 285,000.
“Despite the tense situation, however, slightly more people took up work in 2024 than in the previous year, at 162,000”, the BA said.
It added that “Overall, the risk of becoming unemployed is still lower in manufacturing than in other sectors of the economy.” For certain jobs, such as skilled workers, there were even bottlenecks in demand.
According to the report, industry has more weight in Germany than in other major economies such as France, Italy or Poland. Almost a fifth of the total gross value added in Germany was generated there last year.
Over the past 15 years, Germany saw a strong growth in total employment, but in manufacturing, this growth has been much smaller.
Most recently, the challenges of digital, demographic, and ecological transformation have increased at an accelerating pace, significantly raising the need for adaptation in the manufacturing sector.
The BA warned that “due to demographic change, manufacturing companies are likely to lose about the same proportion of employees as the overall economy over the next 10 years.”
German multinational BASF is sparking a heated debate about degrowth and deindustrialisation after saying it wanted to sell its production facilities in its home country to cut back on costs and secure its competitiveness. https://t.co/1PY0Hq8VCb
— Brussels Signal (@brusselssignal) May 28, 2024
