Over 110,000 Jobs Lost Since 2019
The downturn in the automotive industry, which has long supported the German economy, is now negatively affecting overall employment.
According to CNBC, an American economic media outlet, a 'perfect storm' of industrial and economic challenges has hit the German automotive industry all at once, resulting in tens of thousands of jobs disappearing within a year, as reported on August 26 (local time).
Based on data from the German Federal Statistical Office, consulting firm EY analyzed that from July last year to June this year, approximately 51,500 jobs-about 7% of the entire German automotive workforce-were lost. During this period, the total number of jobs lost across all German industries was 114,000, with nearly half of those losses occurring in the automotive sector.
According to CNBC, EY stated in its report, "No other industrial sector has ever recorded such a strong decline in employment." Compared to the pre-pandemic period in 2019, the automotive sector saw a decrease of 112,000 jobs.
The German automotive industry is facing a triple challenge: competition from Chinese companies, tariff policies under U.S. President Donald Trump, and economic downturn. The German economy recorded negative growth for two consecutive years in 2023 and last year. Although GDP grew by 0.3% in the first quarter of this year, it fell again by 0.3% in the second quarter.
Jan Broehilker of EY analyzed that German automotive exports to its key markets, the United States and China, are expected to remain under pressure-impacted by tariffs in the U.S. market and by declining demand in the Chinese market.
He also noted that many major companies across various German industries are currently undergoing restructuring and implementing cost-cutting measures, predicting that industrial sector jobs will continue to decline in the future.
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