11,000 Jobs on the Line as Another German Company Stumbles
Germany’s largest steel producer, Thyssenkrupp Steel, has announced plans to cut approximately 11,000 jobs by 2030, marking another major blow to the country’s struggling industrial sector. The reductions, representing 40% of the company’s workforce, are part of a strategic overhaul aimed at addressing intensifying global competition and rising costs.
The company plans to reduce 5,000 positions through production cuts and administrative streamlining. An additional 6,000 roles will either be outsourced to external service providers or eliminated through the sale of certain business units.
“Increasing global overcapacity and the influx of low-cost imports, especially from Asia, are putting significant pressure on competitiveness,” Thyssenkrupp Steel stated. “Urgent measures are required to boost productivity, enhance operational efficiency, and align costs with competitive levels.”
Mounting Pressures on German Industry
Thyssenkrupp’s announcement underscores the growing challenges faced by Germany’s industrial giants amid high energy costs, competition from China, and structural disadvantages such as elevated labour expenses and complex regulations.
The energy crisis, exacerbated by Russia’s invasion of Ukraine in 2022, has further strained manufacturers. Germany’s economy contracted last year for the first time since the COVID-19 pandemic, and the European Commission has predicted another contraction for 2024.
Thyssenkrupp is not alone in its struggle. Volkswagen, Germany’s largest automaker, recently revealed plans to reduce employee pay by 10%, close three factories, and lay off tens of thousands of workers. Similarly, US carmaker Ford announced last week it would eliminate nearly 4,000 jobs across Europe, with a significant portion of cuts in Germany.
The Broader Impact
A study by the Federation of German Industries warns that one-fifth of Germany’s industrial output could vanish by 2030. High energy costs, shrinking global markets for German products, and mounting geopolitical tensions are cited as key factors.
Germany’s longstanding expertise in areas like combustion technology is losing relevance, while outdated infrastructure and bureaucratic hurdles further hinder growth.
The study, co-authored by the Boston Consulting Group and the German Economic Institute, calls for a transformative €1.4 trillion ($1.5 trillion) investment in areas such as green technologies, education, and digital infrastructure by 2030 to safeguard the economy’s future.
A Call for Change
Thyssenkrupp’s restructuring reflects the urgent need for German industries to adapt to shifting global dynamics. Without significant investments and reforms, experts warn that Europe’s largest economy risks losing its competitive edge in the face of growing economic and industrial challenges.
