Grimm warns: Rising unemployment threatens German industry!

Grimm warns: Rising unemployment threatens German industry!

The situation on the German labor market is becoming increasingly alarming. Economist Veronika Grimm predicts a slight increase in unemployment in 2025, especially in the manufacturing sector. According to Grimm, established industries in which Germany was previously a global leader will come under severe pressure. “Not everyone will be able to keep their current job,” she warns in an interview with the Bild newspaper. However, with the simultaneous search for skilled workers, she expects unemployment to increase only moderately. However, many employees would not be able to maintain their previous wage levels if they changed jobs, which means: “Many will bring home less money,” said the economics professor, who has been a member of the Federal Government’s Advisory Council since 2020, describing how tagesschau.de reported.

In November 2024, 2.774 million people were registered as unemployed in Germany, which corresponds to a decrease of 17,000 compared to the previous month. However, seasonally adjusted, the number has increased by 7,000, which underlines the ongoing problems on the labor market. Compared to last year, unemployment increased by 168,000, a worrying trend attributed to the weak economy. In view of the economic challenges, Grimm is calling for a comprehensive economic program to promote investments in Germany. “Where, for example, factory closures are planned, politicians should help ensure that new companies are set up,” she continued. Your measures should also help to support the necessary structural change in the economy in order to meet the challenges of the future faz.net.

Several factors are influencing the tense situation: company bankruptcies are increasing, export prospects are bleak, and high energy prices are placing an additional burden on Germany as a business location. The federal government expects a slight decline in gross domestic product in 2024 and minimal growth of 1.1 percent in 2025. The existing structural problems remain unresolved until politicians implement decisive reforms and free themselves from a close connection between politics and business, which has led to inertia has. This could be crucial in leading the German economy into a more stable future.