Manufacturing is currently facing significant challenges, primarily due to weak demand from Germany and the eurozone, leading to export-driven industries struggling. Domestic demand is also low, with business surveys indicating further contraction, low order books, and excess capacity. Employment in manufacturing reduced by nearly 25,000 jobs year-on-year by December 2025. Companies are exploring technologies like industrial robots and process automation to enhance productivity and protect margins. Conversely, the construction sector remains resilient, supported by large infrastructure projects funded by the EU, though tax changes have raised labor costs, prompting cautious business sentiment. The services sector, especially retail and hospitality, faces directly declining household purchasing power, leading to defensive hiring strategies. Meanwhile, the IT sector is experiencing a strategic shift from rapid expansion to greater specialization, with a decline in employment after peak hiring levels. Overall, industries are prioritizing efficiency and adaptability in response to economic pressures.
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