Germany's crisis of labour is getting worse as increasing number of companies across Europe's largest economy face staff shortages, according to a latest business survey by the Munich-based Ifo Institute released on August 16.

The survey found more than 43 per cent of nearly 9,000 firms polled suffering from a lack of qualified workers in July — up from just over 42 per cent in April. The all-time high of almost 50 per cent was reached in July 2022.

"Despite a sluggish economy, many companies are still desperately searching for suitable employees," Ifo’s Stefan Sauer said in an emailed statement, Bloomberg reported.

Germany went through a period of recession during the winter of 2022 and 2023 after energy prices went up due to cumulative effects of the Russian offensive in Ukraine.

The inflation has since stagnated. It has also dragged down in particular by a decrease in manufacturing. But at present, the services sector is also emerging as particularly weak.

Also read |&nbsp;<a href="https://www.wionews.com/business-economy/worlds-fourth-largest-economy-germany-enters-recession-596490">Germany, world’s fourth-largest economy, enters recession</a>

Ifo said the service sector has been hit particularly hard, with three-quarters of legal and accounting companies are also not finding the applicants they need. There were also record shortages for transportation, architecture, and engineering.

Besides, nearly 41 per cent of machinery and equipment makers reported labour deficits. Overall number for the manufacturing industry improved slightly to just under 35 per cent.&nbsp;

Also watch |&nbsp;Germany's far-right party AFD wins first governing post

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The working-age population in Germany actually peaked towards the end of twentieth century. The country, however, has managed to ward off the demographic decline for last couple of decades due to arrival of millions of immigrants and the rising number of women going to work.&nbsp;

Both the trends are now subsiding as baby-boomers begin to retire.

<h2>What does it mean?</h2>

It simply means that the German economy will be more reliant on increasing the productivity of the workers amid growing anti-immigrant sentiment.

Politically, the far-right Alternative for Germany (AfD) is riding high in the polls and has been blamed for driving anti-immigrant push, a charge the AfD has vehemently denied.

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Germany's crisis of labour is getting worse as increasing number of companies across Europe's largest economy face staff shortages, according to a latest business survey by the Munich-based Ifo Institute released on August 16.

Germany's crisis of labour is getting worse as increasing number of companies across Europe's largest economy face staff shortages, according to a latest business survey by the Munich-based Ifo Institute released on August 16. The survey found more than 43 per cent of nearly 9,000 firms polled suffering from a lack of qualified workers in July — up from just over 42 per cent in April. The all-time high of almost 50 per cent was reached in July 2022. "Despite a sluggish economy, many companies are still desperately searching for suitable employees," Ifo’s Stefan Sauer said in an emailed statement, Bloomberg reported. Germany went through a period of recession during the winter of 2022 and 2023 after energy prices went up due to cumulative effects of the Russian offensive in Ukraine. The inflation has since stagnated. It has also dragged down in particular by a decrease in manufacturing. But at present, the services sector is also emerging as particularly weak. Also read | Germany, world’s fourth-largest economy, enters recession Ifo said the service sector has been hit particularly hard, with three-quarters of legal and accounting companies are also not finding the applicants they need. There were also record shortages for transportation, architecture, and engineering. Besides, nearly 41 per cent of machinery and equipment makers reported labour deficits. Overall number for the manufacturing industry improved slightly to just under 35 per cent. Also watch | Germany's far-right party AFD wins first governing post × The working-age population in Germany actually peaked towards the end of twentieth century. The country, however, has managed to ward off the demographic decline for last couple of decades due to arrival of millions of immigrants and the rising number of women going to work. Both the trends are now subsiding as baby-boomers begin to retire. What does it mean? It simply means that the German economy will be more reliant on increasing the productivity of the workers amid growing anti-immigrant sentiment. Politically, the far-right Alternative for Germany (AfD) is riding high in the polls and has been blamed for driving anti-immigrant push, a charge the AfD has vehemently denied. WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

Germany's skilled labour shortage grows amid anti-immigrant push

German carmaker&nbsp;Volkswagen&nbsp;and its labour unions have agreed to 30,000 job cuts by 2021 at its VW brand as part of a plan to boost profitability and fund a shift to electric and self-driving cars after its emissions scandal, a source told Reuters on Friday.

Europe&#39;s largest automaker is trying to increase savings at its biggest unit in Germany, where its costs are high, while needing to find billions of euros to pay for the cleanup related to its diesel emissions cheating scandal.

The agreement, details of which are to be announced at a news conference at 9.30 am local time (0830 GMT), foresees 3.7 billion euros ($3.9 billion) in annual savings at VW&#39;s namesake brand, which will involve 23,000 job cuts in Germany alone, another source said.

VW Group, which has 610,076 employees world-wide, declined to comment.

The so-called future pact, which the two sides have been hammering out since June, aims to increase the brand&#39;s operating margin from an expected 2 per cent this year.

Labour leaders agreed to the cuts in exchange for a management pledge to create new jobs and invest in electric cars, mainly at factories in Germany.

At the same time as cutting traditional jobs, the VW brand will create 9,000 new jobs through investments in electric car technology, the source said.

VW managers have agreed to build an electric sports utility vehicle at the company&#39;s main plant in Wolfsburg and a smaller electric vehicle, known as the I.D., in the eastern German city of Zwickau, the first source said.

Electric motors will be built in Kassel, and VW will start battery cell production in Salzgitter. It will build full battery packs at its plant in Braunschweig, the first source said.

German newspaper Handelsblatt reported earlier that up to 30,000 jobs would be cut by 2020 to save up to 4 billion euros. It also said some 10,000 jobs would be axed outside of Germany, mainly in North and South America.

(Reuters)

The agreement foresees $3.9 billion in annual savings at VW's namesake brand, which will involve 23,000 job cuts in Germany alone

German carmaker Volkswagen and its labour unions have agreed to 30,000 job cuts by 2021 at its VW brand as part of a plan to boost profitability and fund a shift to electric and self-driving cars after its emissions scandal, a source told Reuters on Friday. Europe's largest automaker is trying to increase savings at its biggest unit in Germany, where its costs are high, while needing to find billions of euros to pay for the cleanup related to its diesel emissions cheating scandal. The agreement, details of which are to be announced at a news conference at 9.30 am local time (0830 GMT), foresees 3.7 billion euros ($3.9 billion) in annual savings at VW's namesake brand, which will involve 23,000 job cuts in Germany alone, another source said. VW Group, which has 610,076 employees world-wide, declined to comment. The so-called future pact, which the two sides have been hammering out since June, aims to increase the brand's operating margin from an expected 2 per cent this year. Labour leaders agreed to the cuts in exchange for a management pledge to create new jobs and invest in electric cars, mainly at factories in Germany. At the same time as cutting traditional jobs, the VW brand will create 9,000 new jobs through investments in electric car technology, the source said. VW managers have agreed to build an electric sports utility vehicle at the company's main plant in Wolfsburg and a smaller electric vehicle, known as the I.D., in the eastern German city of Zwickau, the first source said. Electric motors will be built in Kassel, and VW will start battery cell production in Salzgitter. It will build full battery packs at its plant in Braunschweig, the first source said. German newspaper Handelsblatt reported earlier that up to 30,000 jobs would be cut by 2020 to save up to 4 billion euros. It also said some 10,000 jobs would be axed outside of Germany, mainly in North and South America. (Reuters)

Volkswagen to cut 30,000 jobs at VW brand by 2021 to boost profits: Source

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Germany's skilled labour shortage grows amid anti-immigrant push

Volkswagen to cut 30,000 jobs at VW brand by 2021 to boost profits: Source