A banner with the inscription “ifo” stands at a press conference of the Institute for Economic Research (ifo) in Munich. (zu dpa: «German firms plan more job cuts due to geopolitical worries, says ifo») Leonie Asendorpf/dpa
Companies in Germany plan to cut more jobs because of global crises, leading economic institute ifo said on Wednesday.
Ifo’s employment barometer fell by more than two points in March to its lowest level in almost six years.
“Geopolitical uncertainty is affecting companies’ personnel planning,” Klaus Wohlrabe, head of ifo surveys, said in a statement. “More jobs are being cut than created.”
The unresolved conflict in the Middle East in particular is putting a significant strain on the global economy. There is no end in sight to the near-complete blockade of the Strait of Hormuz, which is of central importance for oil supplies.
As a result, energy prices have risen sharply and supply chains have been disrupted. Germany’s Institute for Employment Research (IAB) had previously also expressed pessimism.
Hardly any sector is being spared from job cuts, ifo said.
Among service providers, the employment barometer fell to its lowest level since the start of the coronavirus crisis in 2020.
“A sustained improvement in the labour market can only be expected once uncertainties ease significantly,” Wohlrabe said.