The Institute of the German Economy (IW) today published a survey of 48 industry associations in Germany. The IW titled its publication “Hope for 2020”. If one reads the details, it is more likely to be a “hope and fear for 2020”. The mood in the individual associations is by no means as good as one might think. After all, construction and services (domestic consumption) are still running like clockwork? We quote the IW as follows:
32 associations state that the current economic situation is worse than a year ago. The situation is particularly bleak in industry. Car manufacturers, chemical companies and engineering firms are reporting a significant deterioration compared to last year. One reason for this is that the business situation is returning to normal after a particularly good phase. On the other hand, geopolitical risks and major challenges such as digitalization and climate change are causing uncertainty among companies and consumers. “The overall economic situation is still unstable, and the industry can only hope for stabilization in 2020,” says IW Director Michael Huether. “The all-clear cannot yet be given.”
Cautious optimism in the craft sector
Looking ahead to the coming year, 19 of the 48 associations expect the situation of their member companies to improve and production to increase again. Twelve associations believe that the situation will be somewhat worse. Pessimistic are those associations whose companies process steel and other metals and manufacture machinery.
Only 14 of the 48 industry associations state that they will employ fewer people next year, including banks, savings banks and insurers. The overwhelming majority of the associations surveyed expect to be able to employ as many staff in 2020 as at present. The construction industry, the craft sector and many service sectors are optimistic: they expect higher production next year and therefore also an increased demand for personnel.