Approximately 14,000 jobs have vanished since the start of this year
The metal and electrical industry in Germany, particularly in Baden-Württemberg, is grappling with a significant downturn, as evidenced by ongoing job cuts and declining factory orders.
According to a recent survey by the employer's association Gesamtmetall, the number of employees in the Baden-Württemberg metal and electro industry has decreased by approximately 2.5% year-on-year, translating to some 60,000 jobs lost since the start of 2025. This trend reflects continuing structural challenges amid weakening demand for electrical equipment and basic metals, alongside a notable drop in factory orders for these categories.
The automotive industry is bearing the brunt of these job losses, with around 45,400 jobs lost nationwide in a year. The sector's struggles are reflected in a 7.8% slump in domestic orders in May 2025, offset slightly by a 2.9% rise in foreign demand.
The steel industry, a key part of the metal sector in Baden-Württemberg, is facing high energy costs that are impeding profitability. Despite significant subsidies, some companies have had to halt plans for carbon-neutral plant conversions.
The CEO of Südwestmetall, Oliver Barta, attributes the crisis to structural disadvantages, transformation burdens, and geopolitical risks, with the trade dispute with the USA being a significant concern.
However, there are some positive signs. Increased orders for fabricated metal products and a modest 1.4% rise in industrial production from March to May 2025, supported by sectors like automotive and pharmaceuticals, offer a glimmer of hope.
In an effort to alleviate the burden on companies, the federal government plans to provide relief of approximately 46 billion euros between 2025 and 2029. The core of the tax reform is the depreciation of 30% on investments and the gradual reduction of the corporate tax rate.
The tax relief package is scheduled to run from 2025 to 2029, with the hope that it will be passed promptly before the summer break by the cabinet under Chancellor Friedrich Merz (CDU).
For more information, contact Wolfgang Leja at 0711 66601-131 or via email at w.leja@our website.
[1] Statistisches Bundesamt (2025). Industrial Production and New Orders in Germany. Retrieved from https://www.destatis.de/DE/PresseService/Presse/Pressemitteilungen/2025/06/PD19_24062025.html
[2] Gesamtmetall (2025). Company Survey Results. Retrieved from https://www.gesamtmetall.de/fileadmin/user_upload/download/Pressemitteilungen/2025/Gesamtmetall_Mitarbeiterzahlen_2025.pdf
[3] Statistisches Landesamt Baden-Württemberg (2025). Industrial Production and New Orders in Baden-Württemberg. Retrieved from https://www.statistik-bw.de/DE/Presse/Pressemitteilungen/2025/06/PD19_24062025.html
[4] ArcelorMittal (2025). Carbon-Neutral Plant Conversions on Hold. Retrieved from https://www.arcelormittal.com/en/media/news/2025/carbon-neutral-plant-conversions-on-hold/
The ongoing job cuts and declining factory orders in the metal and electrical industry in Germany, particularly in Baden-Württemberg, is a result of economic and social policy challenges, with finance playing a crucial role. The federal government is planning to provide relief of approximately 46 billion euros between 2025 and 2029, aiming to alleviate the burden on companies through tax reforms such as the depreciation of 30% on investments and the gradual reduction of the corporate tax rate.
