“The Russian war of aggression in Ukraine and its effects on the energy market shaped the year 2022 for companies in the Viersen district,” explains Jürgen Steinmetz, Director General of the Middle Lower Rhine Chamber of Commerce and Industry (IHK) at the giro of the year.
District of Viersen – The economy has shown its resilience, but the energy crisis is a constant burden on companies and hurts Germany’s competitiveness as a business location. Despite all the challenges, Steinmetz is optimistic for the coming year: “In view of the bad mood of the economy, a recession in the region can be assumed. However, I hope that the measures announced by the federal government will be implemented in such a way as to give the companies a considerable relief and that the recession is not too long and severe”.
The general manager of IHK reminds that many companies and sectors are far from recovering from the consequences of the coronavirus crisis. The recovery process also came to a halt during the year due to the energy crisis. The IHK Business Situation Index – i.e. the balance of the share of companies with a good business situation and the share of companies with a poor business situation – for the region was 20.4 points at the beginning of the year, in October it was still by 7.2 points. In the district of Viersen, the situation indicator was only 4.7 points. “When compared with the difficulties, this company situation shows how solid the companies in the region are,” summarizes Steinmetz. “This should make us optimistic that we can face the next difficult months and that the Lower Rhine will continue to be a strong and livable place in the future as well.”
This is also demonstrated by IT.NRW’s industrial turnover statistics. From January to September, the industrial companies of the Viersen district managed to increase their sales by 18.0% compared to the same period last year, despite all the difficulties. Exports increased by 15.3% and domestic sales by 20.1% compared to the previous year. Steinmetz warns against euphoria: “Corporate costs have also risen. This puts the high sales increases into perspective.” Producer prices in industry were almost 35% higher in October than in the same month last year. “Many industrial companies also had a good backlog of orders,” reports Steinmetz. “Our business survey and official statistics show that while orders have not plummeted over the course of the year, they have declined.” .
Due to these circumstances, business expectations have become increasingly pessimistic since the start of the war in Ukraine. A clear majority of companies now believe their business situation will deteriorate significantly in the coming months, after most companies were still optimistic at the start of the year. The main reason for this is the increase in energy costs caused by the outbreak of war, which almost 80% of companies now see as a significant business risk for further economic development. “Energy costs are also currently driving inflation, which limits many consumers’ consumption options,” says Steinmetz.
Steinmetz is particularly concerned about the gas supply. “If there were a further reduction of just 10 percent, about one in eight industrial companies in the region would have to stop production. This shows how bad the situation is in the companies, even though the gas storage facilities are still full at the moment.”
Despite the difficult economic situation, the IHK does not anticipate any noticeable negative effects on the labor market. The unemployment rate in the Viersen district was 5.5% in November 2022, only slightly higher than the previous year’s value (5.2%). More than half of companies consider a shortage of skilled workers a significant business risk for the coming months. “In the Düsseldorf/Middle-Lower Rhine region, we measured a record 53% for this question,” explains Steinmetz. “The employment outlook in 2023 is therefore very good for well-trained specialists, despite the looming recession.” (opm)
