German companies are more reserved with personnel planning than they have been for four years
September 27, 2024, 9:03 a.m
In view of the persistent economic downturn, German companies are more cautious with their personnel planning than they have been in over four years. The employment barometer fell to 94.0 points in September, after 94.8 points in August, as the Ifo Institute announced on Friday in its company survey. This is the fourth decline in a row and the lowest value since July 2020, when the corona pandemic caused severe disruption.
“The structural problems of the German economy are gradually leaving their mark on the labor market,” said Ifo survey director Klaus Wohlrabe, commenting on the development. “Companies are more likely to consider job cuts.”
In industry, the barometer has fallen to its lowest value since August 2020. “Because orders are missing, companies are planning their staff more cautiously,” says the institute. The same applies to retail: Due to consumers’ continued reluctance to consume, fewer staff are needed. The willingness to hire among service providers also fell. Only in the construction industry did the barometer rise slightly. A constant development in the number of employees can be assumed here.
According to the leading research institutes, Europe’s largest economy is likely to shrink by 0.1 percent this year, for the second time in a row, as shown in the autumn report for the federal government. The persistent economic downturn is unlikely to leave its mark on the labor market. This year and next, the unemployment rate is expected to rise to six percent.
