IMore and more companies in Germany are considering job cuts because of the high energy prices. According to the survey published on Monday by the Munich Ifo Institute on behalf of the Foundation for Family Businesses, 25 percent are already planning this.
Six months ago, the proportion was significantly lower at 14 percent. 57 percent of the 1060 companies surveyed, most of them family businesses, are preparing to postpone planned investments.
“For some time now, we have been seeing a gradual shift in industrial value creation,” said Rainer Kirchdörfer, Chairman of the Foundation. “We will only feel this in the form of deindustrialization and loss of prosperity in years to come – but then it will be irreversible,” he said. This fatal development in Germany is accelerating.
Companies state that they are ready to relocate
Companies would scale back manufacturing or relocate production to areas where energy costs, taxes, and bureaucracy are lower. Politicians are trying to curb rising energy costs, which is right. The necessary measures include using nuclear energy as an interim solution for a longer period of time. The expansion of renewable energies must also be accelerated and coal-fired power plants must remain in use.
According to the survey, 17 percent of companies say they would give up energy-intensive business areas altogether. Six months ago, only eleven percent had this idea. Twice as many companies (13 percent) as in spring are considering stopping production. Those who relocate business premises abroad are in the minority. But their number is increasing: 9 percent of companies are planning to do so. Six months ago it was 6 percent.
In the current year, companies are likely to account for an average of 8.2 percent of total sales on energy costs. According to the information, in 2021 it was only 5.1 percent. In order to at least partially absorb the burdens, 90 percent of the companies surveyed stated that they would increase prices.
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