Employment has been declining for 21 months, and job cuts in the metal industry remain the dominant issue in the metal and electrical engineering sector. Oliver Zander of Gesamtmetall attributes this development to excessively high energy costs for industry and taxes, while also warning of increasing EU bureaucracy, as this slows down processes and further increases the cost of manufacturing in Germany. (spiegel: 27.12.25)
Job cuts in the metal industry – when production is no longer profitable
Zander describes a job reduction that is progressing month by month, but leaves little room for quick adjustments. Many plants are operating below capacity, and this is precisely what is driving cost-cutting programs. For Germany as a business location, this means: those who consistently post losses will either relocate investments or cut jobs.
He explicitly links the situation to the cost structure, and he states it bluntly. “Taxes, energy costs, and labor costs are so high in Germany that for many companies, production here simply isn’t profitable anymore,” said Zander. High energy costs act as an amplifier for industry, as expensive energy squeezes margins and simultaneously makes exports more expensive.
Zander’s criticism of Brussels: Regulations as a location factor
Zander also sees a regulatory problem because, in his view, EU bureaucracy complicates even simple production steps. “This is regulation and bureaucracy that is sometimes decided without the necessary democratic legitimacy and is increasingly strangling companies. This has to change. Otherwise, the EU will soon only be playing in the second division economically,” Zander explained. He therefore demands a clear stance from Berlin and wants less regulatory clutter and more practicality.
As evidence, Gesamtmetall cites the number of implementing acts, as these specify regulations down to the practical level. From January to the end of October 2025, the EU Commission adopted 952 such implementing acts, according to the association, more than in the same period in 2024 (898) and 2023 (854). Many companies know these acts as implementation acts and internally anticipate increased reporting requirements and longer approval processes.
IG Metall counters: Investments instead of plant closures
Zander is pressing for decisions and has set a deadline. At the latest, a “curbing of the legal acts” must be decided upon at the EU summit on February 13, 2026, otherwise Europe will lose further momentum. According to his interpretation, if EU bureaucracy increases, job losses in the metal industry will worsen because companies will more consistently shift production abroad.
IG Metall assesses the situation differently, but it also warns of irreparable damage. Christiane Benner says it is “a disaster if plants are closed without rhyme or reason and research and development are relocated to Asia or Eastern Europe.” She also points to energy cost relief for industry and to subsidy policies, and criticizes the fact that many companies are not adequately pricing in these signals. Lower electricity prices could provide additional support if investments then remain in the country.
Ultimately, competitiveness and planning certainty will be decisive, while the industry finds itself caught between politics and the market. Germany will remain an attractive business location if it remains a predictable location and if EU bureaucracy does not escalate further. Otherwise, further job losses in the metal industry are threatened because energy costs for industry will remain too high and implementing regulations will become even more stringent, despite the fact that many companies want to stay.