One job out of seventeen. This is the ratio with which the German industry has downsized its workforce from 2019 to today: 341,500 jobs eliminated in seven years, with an acceleration that shows no sign of slowing down.
Those numbers tell the recent past. But the future does not promise improvements. According to a survey conducted by the consulting firm Horváth on a thousand companies in collaboration with Handelsblatt, in the next four years German companies will increasingly shift their activities toward expanding regions of the world, leaving the domestic market in an increasingly marginal position.
By 2026, another hundred thousand jobs could disappear in the industrial sector, especially in automotive, mechanical engineering, and construction. The title chosen by the analysts for the survey, “Grow without Growing,” precisely summarizes the structural contradiction facing German industry: revenue growth without employment growth, expansion without rooting.
THE DECLINE OF THE EXPORTER MODEL
For decades, Germany’s success in international markets was based on a simple principle: produce at home, export everywhere. That model, according to Ralf Sauter, partner at Horváth and head of the study, is coming to an end. Both production and research and development are now distributed globally, following the logic of new geopolitical risks, growth forecasts, and the competitive disadvantages of the German market.
Labor costs are the main deterrent: data from Eurostat and the Institut der deutschen Wirtschaft (IW) in Cologne show that the hourly cost in Germany exceeds the European average by 22% and is more than double that of many Asian or Eastern European countries.
BASF’s CEO, Markus Kamieth, put it bluntly at a recent industrial conference: “In Germany, personnel costs weigh on us even more than rising energy prices.” Only 20% of companies cite bureaucracy as the main obstacle to domestic investments, thus debunking a widespread cliché in the German public debate, even among economists and politicians.
WHERE NEW JOBS ARE CREATED
The survey outlines a precise map of global industrial redistribution. Almost all companies intend to strengthen their presence in India by 2030, many plan new hires also in China, North America, the Middle East, Africa, and the rest of Asia. In Germany and Western Europe, however, only 16% of the surveyed companies foresee an increase in personnel. 60% are preparing for a progressive reduction of jobs on the national territory.
The only European regions holding up in comparison are those of Central and Eastern Europe: Romania, Hungary, Slovakia. They maintain their attractiveness no longer so much for lower labor costs, which still count somewhat, but for the availability of qualified labor. Handelsblatt draws from recent industrial news some concrete examples: in early June, a new EBM-Papst plant was inaugurated in Romania, Heidelberger Druckmaschinen opened a production site in North Macedonia at the start of 2026, while Gruner, a Swabian specialist in servomotors and electromagnets, is considering a partial move to Serbia.
THE AMERICAN MAGNET
The US market exerts a growing attraction, even in this phase of tariff uncertainty. After the skepticism recorded in the previous edition of the survey, German companies now show a more decisive propensity to invest in the United States, with a share of the budget allocated to North America rising to 18%. It is as if entrepreneurs have measured the Trump-era storm.
The logic of “local for local,” producing where you sell, to bypass tariffs and respond to local demand, pushes the big names of German industry toward choices that are hardly reversible. Here too, names and concrete cases. Siemens Energy will invest one billion dollars in expanding American plants with the hiring of up to 1,500 employees. Mercedes-Benz has announced seven billion dollars of additional investments in the United States, with four billion destined for the Alabama plant by 2030. Boehringer Ingelheim has signed an agreement with the Trump administration to make its drugs more accessible to the American market, committing ten billion dollars by 2028, while simultaneously announcing the abandonment of investments up to 900 million euros in Germany.
THE FRAGILITY OF THE GERMAN GOVERNMENT
These downsizing plans come at a time of political fragility for the German government, which is once again evaluating structural reform measures to support the economy. German growth is almost stagnant, tensions over wealth distribution are increasing, while the current coalition partners appear less compatible with each other than initially thought. The historic parties – CDU and CSU on one side and SPD on the other – are no longer the safety anchors that ensured a secure mooring in turbulent times: today’s Grand Coalition is more like a lifeboat on which forced allies ruthlessly compete for the last available seat to avoid drowning. In the industrially hardest-hit regions, support for parties on the political fringes continues to rise, with AfD on the right now firmly in first place in national polls and Die Linke on the left especially strong among young people. Political confrontation suffers: on one side polarization grows, on the other the pressure from extreme forces on historic moderate parties increases.
SUPPLY CHAINS AND ENERGY COSTS
Returning to the industrial front, companies identify supply chain disruptions as the main operational risk, worsened by the repercussions of the ongoing conflict in Iran: even in the event of a true and stable reopening of the Strait of Hormuz, delivery delays are expected to continue for months.
Concerns about supply chains are compounded by worries over energy costs and persistent inflation. The shortage of qualified personnel, another dominant topic in recent years’ debates, currently appears secondary: with so few hires expected, the problem simply does not arise.
