The German labor market was robust before the Corona crisis. However, as a result of the corona pandemic, the Munich research institute ifo expects unemployment to rise in Germany.
Munich (dpa) - According to the Ifo Institute, the German labor market is also threatened with job cuts in the corona crisis after short-time work.
"The HR departments of German companies are preparing for layoffs," summarized the Munich research institute, the result of a survey. The Ifo employment barometer determined on the basis of the survey fell to a record low of 86.3 points in April, from 93.4 points in March. The decline in the index value was also the strongest that the Ifo Institute ever determined.
"Unemployment in Germany will therefore increase," is the economic researchers' conclusion. The development should affect all areas of the German economy. Accordingly, layoffs should also occur in the service sector for the first time since the financial and economic crisis in 2008 and 2009.
In industry, researchers expect the trend of declining employee numbers that started before the Corona crisis to continue. The number of employees in retail is also likely to decrease, with Ifo researchers citing supermarkets as the only exception. "Even the recently booming construction sector can no longer escape the negative employment dynamics," the statement continued.
The Ifo Employment Barometer is based on around 9,000 monthly reports from companies in manufacturing, construction, wholesale and retail as well as the service sector.
The German labor market had shown itself to be robust before the Corona crisis. In the years since 2010 the unemployment rate had tended to fall. During this period, the rate decreased from around 8 percent to 5.1 percent in March.
Ifo Employment Barometer