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JOBS

Which sectors are looking to hire in Germany?

Despite growing concerns that Germany could face a recession in 2023, some sectors are increasingly optimistic and even looking to hire more staff.

Published: 30 January 2023 16:18 CET
A man works on the engine of an aircraft in a Lufthansa Technik workshop.
A man works on the engine of an aircraft in a Lufthansa Technik workshop. Photo: picture alliance/dpa | Daniel Reinhardt

What’s going on?

Last week, Federal Economics Minister, Robert Habeck (Greens), presented Germany’s annual economic report for 2023, which showed that gross domestic product is expected to grow slightly – by 0.2 percent – this year.

READ ALSO: Why fears of a recession in Germany are rising

Though Habeck said that the figures were “not good”, he said that the situation is better than had previously been feared – particularly for the jobs sector.

At the end of 2022, the number of people in employment reached a record high of around 45.7 million, and the labour market is expected to continue its upswing.

“This trend of job creation is expected to continue this year,” the German government’s annual economic report said and “labour demand is high in many sectors” despite the economic slowdown.

In line with this optimistic outlook for jobs, the latest employment barometer from the Ifo Institute for Economic Research rose in January to 100.2 points from 99.6 points in December.

The Ifo’s employment barometer is a survey which asks around 9,500 businesses in the manufacturing, construction, wholesaling, retailing and services sectors to report on their employment plans for the coming three months.

“The fading pessimism in the German economy is also reflected in the labour market,” said the head of Ifo surveys, Klaus Wohlrabe.

Which industries are looking to hire?

According to the Ifo’s Employment Barometer, the demand for staff rose most sharply in the manufacturing industry and is particularly strong among manufacturers of machinery and in the electrical and electronics industry.  Examples of those affected in the manufacturing industry include companies which manufacture vehicles and parts, chemicals and metal products as well as food and animal feed.

“New employees are being sought, particularly in mechanical engineering and the electrical industry,” Wohlrabe said.

READ ALSO: Five well-paid jobs in Germany that nobody wants to do

An example of an industrial company looking for skilled workers at the moment is aircraft manufacturer Airbus.

Airbus plans to recruit 13,000 new employees worldwide this year, the majority of which – 9,000 in total – are to be created at European sites.

The chairman of Airbus’ works council in Bremen, Jens Brüggemann, said that the company also hopes to create new jobs in Bremen, while for the Hamburg site, the company recently announced that it would create 1,000 new jobs this year due to a major order from India.

The need for new staff has also increased among service providers – such as transport and telecommunications companies,  accommodation and event providers, architectural and engineering firms, as well as legal, tax and business consultation services.  

In the IT industry, in particular, there are many open positions.

In fact, the report says that while some major firms are shedding jobs, other firms will want to employ the laid off staff. 

“The layoffs at large IT companies are an opportunity for many small and medium-sized companies to hire new employees,” the Ifo Institute said in its report.

READ ALSO: German software giant SAP to cut 3,000 jobs

In the retail sector, hiring and layoff plans are more or less in balance in the latest employment barometer, though another study by the Ifo last August found that 41.9 percent of companies in this industry reported problems with a lack of staff. 

In the construction industry, the report also showed that more companies are now willing to hire new staff despite the difficult environment – for example, due to rising material and interest rates. Last summer’s Ifo report also found that the 39.3 percent of construction companies were struggling with staff shortages.

READ ALSO: EXPLAINED: The German industries ‘most affected’ by skilled worker shortage

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TAXES

EXPLAINED: How do you close down a freelance business in Germany?

Leaving the country? Got a steady job offer you can’t say no to? Winding down your self-employment activities in Germany still requires taking a few bureaucratic steps.

Published: 15 May 2024 09:07 CEST
Updated: 15 May 2024 10:57 CEST
EXPLAINED: How do you close down a freelance business in Germany?

Striking out on your own as self-employed is one of the scariest – and potentially most rewarding things – you can do. In Germany, it also comes with its own set of rules around tax and social insurance.

But there are times when – for whatever reason – it may be time to move on.

Whether it’s because you have an exciting new opportunity or things haven’t quite worked out the way you hoped due to economic pressures – winding down self-employment the right way is crucial to avoid gaps in your health and social insurance coverage in Germany.

The steps you have to take are also a bit different depending on if you are new self-employed (Freiberufler) or have a trade licence (Gewerbe) – with some steps not being necessary for new self-employed.

Trade licences are automatically cancelled if the licenced person dies or the company ceases to have financial assets.

Resigning the trade licence or declaring it dormant

New self-employed people like writers or speakers don’t need to go through this step, as they don’t need a trade licence.

Those who have a trade licence will need to contact their competent local authority and resign it, or declare it dormant (withdrawing the licence). If you’re only winding down temporarily, declaring your trade licence dormant instead of de-registering completely may save you a few headaches later.

You may have to do this in person at your local trade office – or Gewerbeamt – depending on whether your local authority allows online de-registration or not. You’ll need to bring your official ID, trade licence, confirmation of registration and possibly an extract from the trade register. Fees are dependent on your local authority and can range from being free to €25.

You can declare the date you intend to resign the licence – which can be in the future. To ensure no gaps in your social insurance protections, including health insurance, set this date for the day before whatever comes next. For example, if you’re starting a new job on January 1st set the date for your trade licence to expire as December 31st.

The trade office will typically notify your local tax office, so you won’t need to do this yourself.

Notifying your tax office

If you’ve had to resign your trade licence, you can skip this step as your trade office will do it for you. If you’re a Freiberufler without a trade licence you need to resign, you’ll have to notify your local Finanzamt, or tax office, yourself.

Luckily, this is a pretty easy step.

First, you need to decide whether you’re ceasing operations completely or wanting to continue them part-time. If you’re ceasing completely, you’ll end up surrendering your self-employed tax number.

You don’t have to do this though. If you think you may still carry on some self-employed business as a side gig, you can inform the tax office that you intend to do so and keep your number.

At that point, the tax office should treat you as a Kleinunternehmer – or a small business making less than €22,000 a year. Having this status means that you will not need to pre-pay taxes or charge VAT on your invoices for freelance side projects.

If you derive any income from your side gig in the future though, you’ll still have to file a tax return.

READ ALSO: Can I have a freelance side gig as an employee in Germany?

Notifying your health insurance

While different private plans in Germany may have different notification requirements, if you have public health insurance in Germany, you should notify them that you’re winding up your self-employed business. Specifically, advise them exactly what date you’re wrapping up.

Again, this should be right before you start your new job or leave the country, to ensure no gaps in your coverage.

If ending your self-employment in Germany, take care to ensure that there’s no gaps in your health insurance coverage, by giving the right date for when you’re ceasing activity. You don’t want to be caught without coverage. Photo by Stephen Andrews on Unsplash

If you are in an artistic profession and thus pay pension, health, and nursing insurance through the Artist Social Insurance Fund (KSK), you should also advise them as well. If you’re leaving self-employment completely, you can typically give notice to KSK as to when it’s ending.

If you’re not, and intend to still make money freelancing as a side gig, they should know this as well. In this event, you’ll no longer pay health or care insurance through KSK, as this is covered through your main job.

You may need to continue to pay pension contributions through KSK based on the amount of money you still make from self-employed activities — depending on how much of them you continue.

KSK: How creative freelancers can pay less for German health insurance

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