- Industrial and business-related positions face potential jeopardy.
German businesses are exhibiting more caution in their workforce management, as per Ifo Institute's observations. The data shows an increase in companies planning to decrease staff, rather than hire new ones, notably in the industrial and retail sectors. Consequently, the Ifo Employment Barometer has dropped for the third consecutive month, now reading 94.8 points, down from 95.3 points in July.
Ifo survey director Klaus Wohlrabe explains, "The current economic lethargy is indicating a weak employment trend." The scarcity of orders is apparently causing businesses to hesitate in expanding their workforce.
Every month, Ifo Institute surveys around 9,500 companies to gather insights about their anticipated changes in workforce size in the upcoming three months. The Employment Barometer is considered a critical indicator forecasting trends in the German job market.
The barometer reveals a deeper slide into negative territory in the industrial sector, with more companies contemplating layoffs. Retail businesses are battling similar issues, as shoppers are staying away from physical stores. Despite the ongoing crisis, the construction sector is committed to maintaining its workforce. Positive trends are just beginning to appear among service providers, particularly within the IT sector and tourism industry.
Given the economic uncertainty and decrease in orders, many German industries, such as the industrial and retail sectors, are contemplating reducing their workforce instead of engaging in new manufacturing activities. Consequently, the manufacturing sector might see a decline in its demand for labor due to these businesses' cautious approach.
