A leading German economic institute on Wednesday said businesses in Germany are considering job cuts as Europe’s leading economy continues to splutter.
The Munich-based ifo Institute for Economic Research’s Employment Barometer fell in August for the third month in a row, dropping to 94.8 points from 95.3 in July.
Weak economic growth is also reflected in weak employment numbers, said study leader Klaus Wohlrabe. “The lack of orders is causing companies to put the brakes on hiring.”
The ifo barometer is regarded as an important early indicator for the German labour market.
Every month, the institute asks around 9,500 companies whether the number of their employees is likely to increase, decrease or remain roughly the same over the next three months.
In the industrial sector, “more and more companies are thinking about cutting jobs,” the August report said. A downturn in consumer spending has also hit the retail sector, it suggested.
Despite the crisis in Germany’s construction sector, employers expect to retain their workers, while a slight rise in employment could be seen among service providers, particularly in the IT and tourism sectors.
