Economy in Schleswig-Holstein: Stagnation threatens industry!

Economy in Schleswig-Holstein: Stagnation threatens industry!

The North German metal and electrical industry is in a tense situation. According to a current survey carried out by Nordmetall in collaboration with employer associations and AGV Nord, the economic situation of many companies is falling short of expectations. Robert Focke, Vice President of Nordmetall, emphasizes that the industry in Schleswig-Holstein is stagnating. Despite a slight improvement in assessments of the business situation, the general mood remains rather gloomy. According to the results, 38% of companies rate their situation as “unsatisfactory” or even “poor”. Only 28% are satisfied with their current business situation, while 34% rate it as “satisfactory”. This means that the proportion of satisfied companies has only improved by 7% compared to autumn.

High costs and bureaucratic hurdles burden companies

Many companies are faced with problems that cloud their future prospects. High labor costs and bureaucracy were cited as burdens by 84% of the companies surveyed. International crises and US customs policy don't make things any easier for companies. The survey shows that 36% of companies report that their order backlog is too low, while overall utilization is at 81%. Fears of layoffs cannot be ignored either: 11% of companies are planning to reduce their workforce. In the other direction, 29% are looking to recruit new staff, meaning a total of 150 vacancies. A ray of hope could be the fact that northern German companies are doing better than average when it comes to finding qualified personnel; 51% have difficulty, but the national average is 58%.

Hope for improvement?

The prospects for the next half-year also give rise to little optimism. Only 24% of companies expect an improvement, while 55% expect continued stagnation. 20% fear that the situation will continue to worsen. A survey of 206 member companies with around 101,000 employees from Bremen, Emden, Oldenburg and Wilhelmshaven shows that 57% of companies expect stagnation in the coming months. Companies in Bremen are particularly pessimistic, where 44% expect their situation to deteriorate further, while Hamburg companies have the most optimistic assessments with only 26% fearing migration.

What also depresses the industry, however, is the relocation of production abroad, which one in five companies is planning. The metal industry in particular is under great pressure. Only in the aerospace sector do 91% of companies show a positive order situation. In other sectors, such as road vehicle manufacturing, 50% report insufficient orders.

The role of politics

In view of the pressing situation, Kiel's CDU Economics Minister Claus Ruhe Madsen said that the economic situation was extremely challenging, especially for export-oriented companies in the metal industry. Another problem remains the attractiveness of Germany as a business location: 49% of companies believe that it is losing its appeal - a decrease from two thirds of the parties that saw it this way a year ago. The federal government's planned use of the 500 billion euro infrastructure special fund offers little hope, as 48% of companies do not see this as an advantage.

Expectations for increased defense spending are equally mixed. 59% of companies see no benefit from this and the overall mood in the industry remains tense.

Overall, the metal and electrical industry in northern Germany is constantly weighing up hope and challenge - especially in view of the potential support from federal programs and the need for fundamental reforms of the current framework conditions. The industry is currently in a constant state of waiting as companies eagerly listen for signals from the federal government.
LN online reports about the latest developments and stern.de explains the challenges of the industry. You can also get further insights at Machinery market.