ifo Institute: Short-Time Work in German Industry Set to Rise Dramatically

Smaller sectors that will also be heavily affected by short-time work are metal production and processing (49 percent), other vehicle construction (43 percent), textile manufacturing (41 percent), production of leather goods and shoes (35 percent), and manufacture of metal products (27 percent).

A few industries expect hardly any short-time work arrangements in the next three months: the chemical industry, with only 14 percent, and the food industry, with only 6 percent.

“The full extent of the coronavirus pandemic has probably not yet been taken into account in all these figures, because most of the responses were received by mid-March,” says Klaus Wohlrabe, Head of Surveys at the ifo Institute.

According to the ifo survey, 9.3 percent of industrial companies have already introduced short-time work. Breaking that down by sector, 15 percent of electrical equipment manufacturers have done so, as well as 14 percent of companies in mechanical engineering and 11 percent in the automotive industry. Smaller sectors with short-time work arrangements in place are metal production and processing plus textile manufacturing, each with 23 percent, and production of leather goods and shoes with 20 percent. Short-time work has not been an issue so far in the chemical or food industries.

There are major differences from region to region: 33 percent of the companies in Baden-Württemberg stated that they would probably introduce short-time work. In Saxony and North Rhine-Westphalia, 30 percent will probably be affected; in Hamburg, Schleswig-Holstein, Bremen, and Lower Saxony, 29 percent; and in Bavaria, 25 percent. In contrast, only 7 percent of companies in Mecklenburg-Western Pomerania, Brandenburg, and Berlin expect to introduce short-time work.