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Working in Germany: Where are the most jobs in the car industry?

Germany's world-renowned automotive industry is going through a tough time, but it's still one of the country's biggest employers. We looked at where the jobs are across the Bundesrepublik.

Working in Germany: Where are the most jobs in the car industry?
Archive picture shows Porsche AG employees in Stuttgart. Photo: DPA

According to figures from the Federal Statistical Office (Destatis) and reported on by trades magazine Wirtschafts Woche, more than 850,000 people were working in Germany's automotive industry in 2018. That is 17 percent more than in 2009, when there were still about 730,000 employees.

Meanwhile, the number of auto firms have remained constant during that time at just under 1360.

But there's no doubt that Germany's world famous car industry is going through a tough time due to weak global growth, the costly shift to electric vehicles and threats by US President Donald Trump to impose car tariffs.

The industry has also been battling for years to escape the after-effects of the “dieselgate” emissions cheating scandal that broke over Volkswagen in 2015 and has since spread to other manufacturers.

Several major carmakers including VW and Daimler have announced thousands of job cuts for the coming years.

READ ALSO:

And a forecast for the number of cars set to roll off German production lines this year showed the figure at a 22-year low of 4.67 million.

Yet hopes are high that US electric pioneer Tesla's first European factory just outside Berlin will boost German carmakers.

So just how important is the sector to the economy in numbers?

Well, Germany's car industry generated roughly €426 billion in total sales in 2018, compared to €423 billion the year before.

READ ALSO: New Tesla factory near Berin to create 'up to 10,000 jobs'

Which states have the most car industry jobs?

A look at the federal states shows that the industry has a different presence depending on the region.

For example, in Baden-Württemberg, the front-runner, the industry employs over 233,000 people, followed by Bavaria with just under 208,000 people.

According to official statistics no other federal state is home to auto employees in the six-digit range.

Photo: DPA

This does not mean, however, that there are no other car jobs across the country.

Official car industry employment statistics for Bremen, Hamburg and Lower Saxony are not published because of so-called statistical secrecy. Thenumbers are so small that statistics could result in individual details being identified.

For Bremen and Hamburg this makes sense, as there is not a large amount of companies with lots of employees.

Lower Saxony, on the other hand, is home to Volkswagen, one of the largest German car manufacturers. But if too many employees work for one employer alone, the statisticians believe that secrecy can be violated and choose not to publish the figures.

But VW itself steps in here: according to its own figures, the group employs more than 131,000 people in Lower Saxony alone. This puts the state in third place among Germany's car employees.

READ ALSO: German car sales plummet as new pollution rules bite

Here's a breakdown of the number of employees in Germany's auto industry in 2018 compared to 2009, according to official figures:

Baden-Württemberg – 233,296 (2009 – 196,417)

Bavaria – 207,829 (2009 – 207,829)

Lower Saxony – 131,000 (2009 – 111,348) *VW figures

North Rhine-Westphalia – 83,809 (2009 – 81,983)

Saxony – 38,053 (2009 – 24,164)

Rhineland-Palatinate – 22,314 (2009 – 27,211)

Saarland – 22,314 (2009 – 22,733)

Thuringia – 17,497 (2009 – 14,592)

Brandenburg – 6984 (2009 – 5797)

Schleswig-Holstein – 3916 (2009 – 4010)

Saxony-Anhalt – 3877 (2009 – 2799)

Berlin – 3383 (2009 – 3631)

Mecklenburg-Western Pomerania – 3182 (2009 – 2145)

A VW e-Golf in production hangs in the Dresden factory. Photo: DPA

Who are the big employers?

The number of companies is also particularly large in the two states in the south (Bavaria: 240, Baden-Württemberg: 285).

It is interesting to note that North Rhine-Westphalia (NRW), with a total of 246 companies, has even more firms than Bavaria. But with just under 84,000 staff, there’s only a fraction of the number of employees.

In Bavaria, the car multinational BMW alone employs 77,000 people, almost as many as those who work in the car industry in NRW as a whole.

Another heavyweight is Audi in Ingolstadt. In NRW, on the other hand, there are mainly small and medium-sized companies with comparatively few employees.

The state of Rhineland-Palatinate has suffered the most from the crisis in the automotive industry so far.

In 2009, 27,000 people were still working in the 'motor vehicles and parts' sector, as defined by Destatis. Nine years later the figure was only 22,000. Even so, the auto industry remains the second most important sector in the state.

READ ALSO: How Germany is preparing for the rise of the electric car

Which cities employ the most people?

The official statistics not only provide data by federal state, but even down to the level of counties and cities.

The data shows that the car sector in Germany is mainly concentrated in regional clusters. In the Stuttgart district alone, for example, almost 160,000 people work in the motor vehicle and parts sector.

No wonder, given that Mercedes-Benz and Porsche, Bosch and suppliers such as ElringKlinger all manufacture there.

Upper Bavaria, with BMW and Audi, also has a particularly large workforce of 105,000.

So far, the crisis in the automotive industry has not been reflected in the employment figures for the sector – quite the opposite. 

According to their own figures, both VW and BMW have significantly increased the number of employees between 2009 and 2019, from 62,000 to 77,000 (BMW in Bavaria) and from 95,000 to 131,000 (VW in Lower Saxony).

But there are fears that the switch to electromobility could result in serious job losses in Germany's auto industry.

A recent study found that 410,000 jobs are at risk of being cut by the end of the decade.

However, not everyone believes that will happen. 

“The assumption that up to 410,000 jobs could be lost in the coming years is based on an unrealistic extreme scenario,” said German Association of the Automotive Industry (VDA) Managing Director Kurt-Christian Scheel.

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WORKING IN GERMANY

7 tips for how to survive as a freelancer in Germany

Taking the decision to go it alone and freelance in Germany can be a daunting prospect. But, if you do it right, it can be an exciting and liberating path. Here are some of our top tips on how to survive.

7 tips for how to survive as a freelancer in Germany

1. Get a tax advisor

The German tax system is complicated, even for Germans. All the associated paperwork uses the Amtsprache (authority language) which is more like legalese than ‘normal’ German, and mistakes when filling out tax forms can cause you, at best, a massive headache and, at worst, a costly fine. So it’s best that you employ someone who knows what they’re doing to help you out.

That person is called a Steuerberater (tax advisor) in Germany. They will help you register with the tax office, correspond with them and submit your tax declarations.

Be aware that, in Germany, different deadlines apply for tax returns depending on whether you employ an official tax advisor or not. If you are doing the tax return on your own, the deadline for submitting your annual tax return is earlier than if you use a tax advisor’s services. 

READ ALSO: What NOT to do when you’re freelancing in Germany

When looking for a tax advisor, a top tip is to use your network to get recommendations. Ideally, you want someone who will do more than just fill in the forms for you, but who will actually advise you on how best to manage your business finances so that you can make tax savings.

2. Keep your accounting in order

The better you keep your own accounts in order, the easier it will be for your tax advisor to compile your tax declarations and therefore the cheaper their services will be.

As a freelancer, there are a lot of costs you can deduct from your taxes – from train tickets, working materials, to meals out – so it’s best to keep hold of all your receipts and to keep them in good order.

2 euros and 50 cents lie on a receipt in a beer garden. Photo: picture alliance/dpa | Peter Kneffel

In Germany, you’re obliged to keep hold of receipts for two years, in case of a tax inspection, so it’s a good idea to photocopy the type of machine-printed receipts you get from restaurants so that they stay legible for a long time.

There are also a few things to be aware of when writing your own invoices. Firstly, make sure that you include your tax number. This isn’t the 11-digit Steueridentifikationsnummer that everyone gets when registering in Germany, but the 10-digit Steuernummer you get from the Finanzamt after registering yourself as a freelancer. 

Most companies won’t pay you if you don’t have this on your invoices so make sure you include it.

You should also make sure that you number your invoices properly – ideally in ascending order so that you can easily keep track of them. You are not allowed to issue two invoices with the same number and if you do so and the finance office notices, you could face an inspection of your whole accounting system.

There are numerous great accounting software programmes you can use to help you, such as Lexoffice and Sevdesk and, even if you have to pay for them, the costs will be tax deductible!

3. Find out if you’re eligible for financial support

In Germany, there are several opportunities for freelancers to gain financial support and to cut their outgoings, and its worth finding out if you’re eligible for them.

If you’re claiming unemployment benefits under ALG 1 and are thinking about becoming a freelancer, the employment office offers a special type of financial support to help you to get your freelance business off the ground.

Called the Grundungszuschuss (“foundation grant”) the payment is a six-month grant equalling your monthly entitlement under ALG 1 plus €300 towards your insurance costs can be applied for those in receipt of this unemployment benefit.

READ ALSO: Will freelancers benefit from Germany’s €300 energy allowance?

If you are engaged in some form of artistic profession in Germany – which can include journalism to pottery – you may be entitled to membership to the Kunstlersozialkasse (artists’ social insurance).

Being a member of the KSK means you only have to pay half of your health insurance and pension contributions, and the KSK will pay the rest.

4. Work out how much you think you will earn

As with starting any business, you need to have some idea of your expected earnings from the outset.

If you’re just starting out as a freelancer, or have some freelance gigs on the side of an employment position, then it might be worth considering registering yourself as a Kleinunternehmer (“small business”).

As a Kleinunternehmer, you can currently earn up to €22.000 per year without having to charge VAT and having to submit only yearly tax declarations. 

An income tax declaration form lies on a table. Photo: picture alliance/dpa/dpa-Zentralbild | Hans-Jürgen Wiedl

Be aware that if you are registered as this kind of freelancer, you must include the following sentence in your invoices: ‘Gemäß § 19 UStG wird keine Umsatzsteuer berechnet’ which means ‘In accordance with Paragrah19 of the German VAT law, no VAT has been added to this invoice.’

READ ALSO: Everything you need to know about your German tax return in 2022

If you think you will earn more than €22.000 per year, you will need to pay Umsatzsteuer (VAT) and will have to submit tax declarations in advance and more often. Depending on how much you earn, this could be every month or every quarter. 

5. Get your insurance in order

In Germany, it’s a legal requirement to have health insurance.

If you’ve just made the move from employment to being a freelancer and want to keep the same health insurer, you should get in contact with your health insurance provider straight away to tell them about your change of circumstances. They will ask you to re-register and to tell them your projected freelance earnings for the year, so they can amend your monthly fees.

If you don’t keep your health insurer provider updated, you could continue to be charged the higher rate that you had from your previous salary.

The insurance cards of the health insurance companies DAK, AOK, Barmer and Techniker-Krankenkasse TK lie with euro notes under a stethoscope. Photo: picture alliance / dpa | Daniel Karmann

It’s not just health insurance you need to think about as a freelancer. It’s also wise to think about protecting yourself from any sort of claims that could arise as a result of any working mishaps. 

If, for example, you lose your laptop which contains confidential client information, you need to be protected against claims.

That’s why it’s good to have both Betriebshaftversicherung (business liability insurance) and Rechtschutzversicherung (legal protection insurance).

6. Plan your time wisely

All of these bureaucratic obligations take time. So it’s really important that you take account of that when planning your time. For example, planning half a day a week to deal with your invoices, filing, emails to clients, and conversations with authorities can be really beneficial when scheduling your working time. 

7. Grow your network

As a freelancer, networking is absolutely crucial to success. 

Keep an up-to-date profile on websites like LinkedIn and German equivalent XING and keep in contact with anyone you’ve ever worked with, no matter how brief the contact was. 

Having a network is not only about getting more clients, but also about building a support network in your field to exchange advice, tips and generally for your own enrichment. 

Participating in workshops related to your field, going to seminars, and meet-ups, can be great ways of broadening your network. 

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