The German economy is expected to shrink for the second consecutive year, leading to significant layoffs at ThyssenKrupp Steel, Germany’s largest flat steel manufacturer. The company plans to cut around 5,000 jobs by 2030 through production and administration adjustments, with an additional 6,000 jobs to be transferred to external service providers or shed through the sale of business activities.
With a workforce of 27,478 employees as of September, the cut of 11,000 jobs represents a 40 percent reduction in the total workforce. ThyssenKrupp Steel aims to reduce personnel costs by an average of 10 percent in the coming years in response to structural changes in the European steel market, including overcapacity and increased competition from cheap imports, particularly from Asia.
To improve operating efficiency and productivity, ThyssenKrupp plans to reduce production capacity and shut down certain processing sites. CEO Dennis Grimm emphasized that these measures are necessary for the company to adapt to changing market conditions and become more competitive.
The layoffs at ThyssenKrupp are part of a broader trend in the German corporate sector, with companies like Bosch and Volkswagen also announcing job cuts in response to challenging economic conditions. The weak German economy, which shrank by 0.3 percent in 2023, is facing structural challenges related to demographic change, competitive positioning, and economic factors affecting both domestic and foreign demand.
A report from the Federation of German Industries highlighted the impact of rising energy costs on the country’s industrial competitiveness, warning that these costs could lead to production and investment moving out of Germany. The government’s focus on renewable energy policies has also been cited as a factor contributing to Germany’s economic challenges.
Overall, the layoffs at ThyssenKrupp Steel reflect the broader economic struggles facing Germany’s industrial sector and the need for companies to adapt to changing market conditions in order to remain competitive. Can you please rewrite this sentence for me?
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