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Quarter of German firms 'cutting jobs in 2013'

The Local · 19 Nov 2012, 16:17

Published: 19 Nov 2012 16:17 GMT+01:00

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The survey of about 2,300 firms pointed to a more pessimistic mood among German employers, with nearly 28 percent saying they were planning to shrink staff numbers in 2013, and just under 20 percent planning on expanding their work forces.

The Cologne Institute for Economic Research (IW) found out that 30 percent of businesses said their position was "worse than the previous year." This was 18 percent at the start of 2012.

Faltering foreign business and the associated limitations on production were making companies "markedly more cautious," concluded the IW.

For the first time since autumn 2008, more employers are expecting their production levels to fall than to rise. In the spring almost 40 percent were predicting production increases - a figure which by November had fallen below 17 percent.

In anticipation of a difficult business climate, many had curbed their investment plans. The number of companies in western Germany with planned reductions has almost doubled over the course of the year with a third planning to cut outlay.

"Export-intensive enterprises are being burdened by the sharp slowdown of the global economy, in particular by the recessionary trends in many European countries," IW director Michael Hüther told the Frankfurter Allgemeine Zeitung.

The country could avoid outright recession but growth figures did not appear encouraging. IW's 2013 growth forecast of 0.75 percent falls even below this year's figure of just under 1 percent.

A further escalation of the eurozone debt crisis could derail even these modest projections.

Story continues below…

Hüther urged politicians to do everything possible to support businesses. "This includes doing without taxation hikes, using all available means to curtail social security expenditures, the continued development of infrastructure, and a convincing solution for Germany's energy transition," he told the paper.

The authors of the report noted that the German economy - despite often appearing to represent an "island of bliss" in the European debt crisis - may not be invincible after all.

DAPD/The Local/pmw

The Local (news@thelocal.de)

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Your comments about this article

03:04 November 20, 2012 by Berlin fuer alles
Dying to hear from Chris Rea on this one.

As I and Smart2012 have been saying for a long time this is a start of the reality. Dr. Merkyl and Mr. Hyde is flying in ever decreasing circles and is fast approaching flight path up her own ass.
10:54 November 20, 2012 by smart2012
well done Verkel!!!
12:38 November 20, 2012 by grinners
Pity we can't see the relative stats here. From the numbers it appears a little over 8% (in total) may reduce staffing numbers, the majority of which are in export.

From this group, how big are the firms? How many people do they employ?

It's difficult to gather anything really useful from this kind of reporting.
13:35 November 20, 2012 by michael4096
"Export-intensive enterprises are being burdened by the sharp slowdown of the global economy..."

Yep! Sounds like all Merkel's fault to me. She should know better than slowing the world economy like that...
15:41 November 20, 2012 by Berlin fuer alles

Well she certainly did her best to slow down the Eurozone economy. :-)
00:02 November 21, 2012 by chris berlin
... polemic drama boys up there, even these news are not so dramatic. First, they are still projections into the future and even if it will apply, they talk about a a growth forecast of 0.75 percent. Growth... even no recession... so no need to worry. Sweet dreams.
04:54 November 21, 2012 by honeybeee
This sounds a little bit pessimistic, but in such a bitter situation , there still have some business model companies to survive in this current downturn situation , Schaeffler ag is just one of them , in their recent Q3 financial report , 4% revenue growth expectation achieved is not too bad in this still difficult situation compared to other company in other industry . Although their own company cash flow remains tight as well , they will still hang on to exceed last year¦#39;s whole year EBIT as the 2012 year expectation remained unchanged and even tried to invest and creat more factories and jobs in india and hungary .Whatever situation is coming in 2012 , Schaeffler believes themselves as a brave and skillful management company to deal with it with their great marketing ambition.
14:13 November 21, 2012 by smart2012
chris berlin, i thought Germany was booming...
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