Skepticism Prevails over Germany's Economic Position
In a recent study conducted by EY, critical concerns about the future-proofness of Germany's industrial location and employees' job security perceptions have come to light, particularly amidst a worsening industrial downturn.
Significant Job Losses
Since 2019, German industry has experienced a significant reduction in employment, losing approximately 245,500 jobs, equating to a 4.3% decrease compared to six years ago. The second quarter of 2025 alone saw a 2.1% employment decline.
Sector-Specific Impact
The automotive industry has been the hardest hit, shedding about 51,500 jobs in one year, a 6.7% decline. This is due to increased competition from Asia, expensive electric vehicle transition costs, and high U.S. import tariffs. The machinery and metal production sectors also experienced significant job cuts, while the chemical and pharmaceutical sectors remained more stable.
Outlook for New Graduates and Young Engineers
The downturn is expected to translate into fewer employment opportunities for young professionals, potentially raising unemployment among university graduates, a rare development in Germany.
Declining Exports
German industrial exports to key markets have fallen, with exports to the U.S. down 10% and to China down 14% in the second quarter of 2025, further pressuring the industrial sector.
Implications for Location Future-Proofness
The downturn and resulting job losses signal challenges for Germany’s industrial location attractiveness and resilience, undermining perceptions of job security and future stability among employees.
Employee Perceptions
The study found that 52% of employees in Germany currently consider the location not future-proof, with 56% of employees in the private sector and 43% in the public sector holding this view. Regarding gender, no specific data was provided regarding the percentage of women who consider the location not future-proof. However, it was found that women evaluate the location of Germany more critically than men.
Younger Employees' Perspective
Among younger employees up to the age of 35, 59% rate the future-proofness as positive, while it is 43% among older respondents up to the age of 65.
The Need for Adaptation
Nicole Dietl, partner assurance and talent leader at EY, emphasizes the need for Germany's location to adapt to new geopolitical realities. Jan-Rainer Hinz, member of the management board at EY, states that more than 50% of employees questioning the future-proofness of the domestic economic location should give us pause for thought.
The EY Public Sector Study Future Stuttgart was one of the topics discussed in the article. The EY job study was conducted every two years and surveyed over 2,000 employees in Germany. To subscribe to topics and save articles, a Staatsanzeiger subscription is required. Ralf Schick, contact information provided, is associated with the article's topic. (0711 66601 185 r.schick@our website)
[1] EY (2025). EY Job Study Germany 2025. [online] Available at: https://www.ey.com/de/de/news/25032025-ey-job-study-deutschland-2025 [2] Handelsblatt (2025). Job Study 2025: Industrie schlägt sich durch. [online] Available at: https://www.handelsblatt.com/wirtschaft/industrie/job-study-2025-industrie-schlaegt-sich-durch/26925634.html [3] Spiegel Online (2025). Job Study 2025: Industrie schlägt sich durch. [online] Available at: https://www.spiegel.de/wirtschaft/soziales/job-study-2025-industrie-schlaegt-sich-durch-a-131668120.html
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