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Sentiment in Saxony's skilled trades remains gloomy

A car mechanic services a car in a garage. / Photo: Marijan Murat/dpa/Symbolic image
A car mechanic services a car in a garage. / Photo: Marijan Murat/dpa/Symbolic image

Inflation, a shortage of skilled workers and high interest rates are also weighing on Saxony's skilled trades sector. So far, the sector has proven to be robust despite the problems - this now seems to be changing.

The ongoing crisis in the German construction industry continues to weigh on the mood in Saxony's skilled trades sector. Uncertainty and skepticism about future business expectations continue to dominate, said Andreas Brzezinski, Managing Director of the Saxon Crafts Association, at the presentation of the 2024 economic survey in Dresden on Wednesday. The majority of companies expect orders and turnover to decline in the near future. "For the time being, there can be no talk of an economic upturn, at least in the skilled trades sector".

According to Brzezinski, there is a lack of investment incentives and planning security on the part of politicians, for businesses and consumers alike. In addition to the reluctance of private households, a shortage of skilled workers and labor, the unpredictable development of interest rates, high energy costs and bureaucracy are weighing on companies. Politicians must "provide effective impetus so that the skilled trades sector can emerge from the economic trough".

1293 companies took part in the survey. Only 39% of companies rated their business situation as good or better, compared to 48% in 2023. For 17%, it is poor or deteriorating, a good two thirds expect business to remain stable at most in the coming weeks, and more than a fifth expect a downward trend.

In the main construction and finishing trades, only just under a third and 44% of companies respectively rated the business situation as good, with just under a quarter and 16% rating it as poor. There are also "signs of a slowdown" in the precision mechanics, electrical engineering and metalworking, optometry and hearing acoustics and food sectors, according to the Handwerkstag. However, the situation in the automotive industry and among service providers such as hairdressers and goldsmiths is largely stable.

Turnover for products and services is down significantly compared to 2023, with more than a third reporting losses. In the sales sector, just under half of those surveyed were able to push through higher prices on the market. The order situation also deteriorated as a result of the construction crisis, with slumps in the main construction industry, personal service providers and the commercial sector in particular. Almost 40 percent of companies invested less.

Handwerkstag President Uwe Nostitz called on politicians to create the framework conditions for strengthening Saxony as a business location. More incentives and impetus for self-employment are needed, as well as internal security and a strategic expansion of transport routes. The umbrella organization of the industry currently represents the interests of around 55,000 companies with around 290,000 employees and 15,000 trainees.

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