Nuremberg According to economists, the immense loss of purchasing power and the explosion in costs for companies due to high energy prices are leading the German economy straight into recession. Marc Schattenberg from Deutsche Bank Research even predicts a decline in economic output of 3.5 percent for the next year.
According to a dpa survey, other economists see the effects as somewhat milder Economy but still clearly on the way down. “The economic downturn will also leave its mark on the labor market,” said Fritzi Köhler-Geib, chief economist at the state development bank KfW.
Above all, private households and their purchasing power have had to lose a lot of feathers. “Due to the high inflation, the financial situation of private households has deteriorated considerably since the beginning of the year,” commented Köhler-Geib. “In the second quarter, the disposable income of private households after deducting the inflation rate was 1.9 percent lower than in the same quarter of the previous year. In the second half of the year, real incomes are expected to fall further,” she said.
“The loss of purchasing power is dampening consumption and, together with the rise in interest rates, also private housing construction.” Marc Schattenberg takes a similar view: “The majority of households will have to cope with noticeable real income losses.” Katharina Utermöhl, economist at the Allianz Group, sums up the situation even more clearly: “We will all come out of the crisis poorer.”
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Germany I am going through the worst crisis of the last 50 years. “That puts the great financial crisis and the euro debt crisis in the shade,” she said. The pain of inflation must now be cushioned. On the one hand through fiscal policy measures of the state, but on the other hand also through the savings behavior of private individuals.
Economy Veronika Grimm: The supply of energy must be increased
Not enough awareness has arisen here, said Christoph Siebecke from the Oldenburgische Landesbank. “Politics should not influence the price too much. Otherwise, households will not react,” he said to the discussion about the possible capping of energy prices. “The incentive for consumers to save must remain noticeable,” agrees Veronika Grimm, a member of the Advisory Council of the federal government, the so-called “economic wise men”.
For them, one of the keys to how Germany will be able to cushion the crisis is providing enough energy. “One should exhaust all possibilities on the supply side. The supply of energy must be increased,” she stressed.
“I have the feeling that not everyone is aware that renewable energies alone will not be available as a replacement quickly enough,” she added. For example, only two coal-fired power plants went back on line. “The nuclear power plants should also continue to run in the coming year and not just be ready for operation,” she demanded.
In this context, Siebecke called on the energy companies to immediately pass on discounts on the markets to their customers. “World prices are now a long way from the highs we’ve seen before,” he said. “It would be good if the cartel office could take a closer look.”
More insolvencies are expected due to the energy price crisis
Deutsche Bank economist Marc Schattenberg believes that the really big problems will only hit Germany in the first and second quarters of next year. If the gas storage tanks, which were well filled before the winter, are now empty and gas has to be bought on a large scale to be refilled, the price will continue to rise. At the same time, the new municipal utility contracts that often have to be concluded at the turn of the year eat a lot of holes in the pockets of private gas customers.
>> Read also: How the energy crisis is threatening the German economy
Economists expect that the energy price crisis will also lead to more insolvencies – especially among smaller companies with a high proportion of energy costs. Exports will also suffer because trading partners abroad will also have to accept losses in purchasing power, said Köhler-Geib.
IG Metall is demanding eight percent more wages
In this context, the experts also advocated moderate wage agreements in the forthcoming collective bargaining. “The full order book argument will lose strength,” Schattenberg said. And Veronika Grimm emphasized: “The bargaining power of the trade unions is great due to the shortage of skilled workers. On the other hand, many companies are under pressure. It remains to be seen what that means for the degrees.”
IG Metall boss Jörg Hofmann recently reiterated the demand for eight percent more wages in the current round of collective bargaining in the metal and electrical industry – and considers general concerns about the competitiveness of German industry to be exaggerated. “The worst-case scenario from the forecasts we have would be a recession for the whole of 2023, down 1% to 2%. The best case is zero. In any case, we are not on the brink,” he told the “Welt am Sonntag”.
According to the head of the Federal Employment Agency, Andrea Nahles, but recently more companies have asked about the conditions under which they could register short-time work. “This is an early indicator that there could be more short-time work again,” she told the editorial network Germany (RND).