Germany’s metal and electrical engineering industries face further massive job losses in 2026. The employers’ association Gesamtmetall anticipates the loss of up to 150,000 jobs this year. The warning stems from the ongoing crisis in the sector, which shows no signs of abating despite a significant increase in orders in the last quarter of 2025. The key factor remains Germany’s industrial landscape, characterized by high energy prices, high corporate taxes, rising social security contributions, and increasing bureaucracy. An additional risk factor is that the recent surge in orders stems primarily from government-funded defense contracts, while other business remains weak. The consequences therefore affect both employees and companies, as the sector continues to lose jobs and its workforce is falling to its lowest level in years. (ntv: 08.03.26)
Defense contracts mask the weak foundation
The recently reported increase in orders appears at first glance to be a positive sign. In reality, however, the growth stems primarily from the defense sector. Without these large, government-funded contracts, the order situation remains poor, according to the employers’ association Gesamtmetall.
This is precisely where the real problem lies. While individual large orders may improve the statistics in the short term, they do not stabilize the entire industry. For many companies, therefore, it is not the special boom in armaments that matters, but rather the continued weak demand in other sectors.
Employers’ Association Speaks of Deindustrialization
The employers’ association Gesamtmetall describes the situation unusually sharply. Managing Director Oliver Zander said: “We are in the midst of deindustrialization, and the outlook is very bleak. The situation is truly dramatic.” He also spoke of the industry’s biggest crisis since the founding of the Federal Republic of Germany.
The employers’ association supports this assessment with concrete figures. Since 2018, the metal and electrical engineering industry has already lost 270,000 jobs. Last month, the number of employees also fell below 3.8 million. Such a low figure was last reached in 2015, which makes the new forecast for 2026 even more critical.
High Costs Exacerbate the Pressure on Companies
The association cites the business environment in Germany as the main cause. Companies are particularly burdened by high energy costs, high corporate taxes, and high social security contributions. Furthermore, Gesamtmetall sees bureaucracy as a major obstacle to investment and production.
Zander criticizes not only the extent of the regulations but also the pace of the announced relief. The reduction of bureaucracy announced by the federal government is taking too long. At the same time, the association believes there is a lack of a clear and systematic strategy to actually provide relief to companies.
Criticism of the state and administration is intensifying
Zander’s comparison to bureaucracy was particularly pointed. “We are more systematic in combating animal diseases than in cutting red tape,” he said. He also called for a reduction in bureaucracy, arguing that there is too much staff in public administration, placing an additional burden on budgets.
This shifts the debate about the industrial crisis increasingly to the political framework. According to the association, the sector has been in recession for two years, while costs remain high and structural relief measures are lacking. As long as this situation persists, the anticipated loss of up to 150,000 jobs is likely to be just another sign of the ongoing decline of Germany as an industrial location.