Thousands of positions eliminated since the beginning of the year, amounting to nearly 14,000
In the heart of Germany, the metal and electro industry in Baden-Württemberg is grappling with economic challenges. The sector, employing a workforce of 957,300, has seen a decline in factory orders and industrial production, leading to job market uncertainty and significant job losses.
According to recent data, factory orders in Germany dropped by 1.4% month-over-month in May 2025. Orders for computer, electronic, and optical products plunged by 17.7%, while demand weakened for electrical equipment (-6.2%) and basic metals (-5.1%). However, orders for fabricated metal products rose by 18.2%[3].
Industrial production in Germany also saw a sharp decline in April 2025, with a 1.4% month-over-month drop. Notable output declines were observed in machinery and equipment (-2.4%) and energy-intensive industries (-1.8%). There was, however, some recovery in May 2025 driven by automotive and pharmaceuticals, but construction and energy-intensive production declined[2].
These economic headwinds are reflected in the job market. Available job listings in Karlsruhe, a major city in Baden-Württemberg, show various positions in engineering disciplines, including electrical engineering technicians and posts related to science and engineering. However, many of these roles are fixed-term or project-based, which could suggest cautious hiring practices[1].
Since the beginning of the year, the Baden-Württemberg metal and electro industry has lost almost 14,000 jobs. This figure represents a continuation of a longer-term trend, as the industry has lost over 50,000 jobs since the peak in 2019[4]. The automotive industry, closely related to metal and electro sectors, is also experiencing the strongest job cuts, with around 45,400 jobs lost nationwide in a year.
The CEO of Südwestmetall, Oliver Barta, attributes the crisis to structural disadvantages, poor location conditions in Germany, ongoing business transformation, as well as "enormous geopolitical risks". Barta is particularly concerned about the ongoing trade dispute with the USA and hopes for a resolution by early July[5].
In an effort to provide relief to companies, the federal government plans to provide relief to the tune of 46 billion euros between 2025 and 2029. The core of the federal government's reform includes a 30% depreciation on investments, limited to three years. The corporate tax rate is also planned to be gradually reduced by one percentage point per year from 2028[6].
Barta urges the federal government and Bundesrat to pass the announced tax relief package immediately before the summer break[7]. He believes that immediate action is necessary to stabilise the industry and protect jobs.
For further information, Wolfgang Leja can be contacted at 0711 66601-131 or via w.leja@our website.
Approximately a quarter of companies in the second quarter of 2025 plan to use short-time work in the next three months. Employers are concerned about a continuing negative trend in personnel plans, despite slight improvement[8]. The situation underscores the need for swift action to support the industry and safeguard jobs.
Economic and social policy must be addressed immediately to mitigate job losses in the Baden-Württemberg metal and electro industry. The federal government's proposed tax relief package, including a 30% depreciation on investments and a gradual reduction in corporate tax rate, is crucial for stabilizing the industry and finance needed for business operations.
