German companies are laying off more than 10.000 workers

Car factory in Germany/ Photo: EPA-EFE/MARTIN DIVISEK

German companies have been delaying the changes for a long time, and now they have announced that they will lay off more than 10.000 workers, Anatolia reports, reports Al Jazeera Balkans. Major German companies, leaders in the automotive, chemical, mechanical, pharmaceutical and information industries, will lay off more than 10.000 workers, including highly educated workers. The reason is the urgent changes they are delaying, which they are now forced to make due to lower demand, high energy prices, lower profits, an outdated decision-making structure, and especially after the rise of key interest rates – expensive loans.

If 2022 was a great year for sales of refrigerators, washing machines and other household appliances, the directions changed last year. Therefore, for example, Miele plans to reduce the number of employees by 2.700, and BSH of Bosch, which also has a factory in Slovenia, by the end of 2027 by 3.500, of which 450 are in management.

Unemployment is on the rise, so the question arises as to why all this is happening now. In previous years, due to low interest rates, companies received practically free loans, the state co-financed salaries during the pandemic, and the demand due to the corona virus was high. Times are different now. They are characterized by fierce competition from abroad, high domestic energy prices, higher labor costs and the intrusion of artificial intelligence. Ludwigshaven-based chemical giant BASF, according to boss Martin Brudermüller, "urgently needs to take decisive and deep measures to ensure continued competitiveness."

This also means the elimination of 2.600 jobs. The pharmaceutical company Bayer is setting up new decision-making processes, so it will reduce middle management.

Unemployment in Germany is 6,1 percent and will grow this year.

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