Germany: The new lockdown costs 3.5 billion euros per week


BERLIN. According to economists, the upcoming hard “lockdown” has massive effects on the economy and jobs. "Every week lockdown is likely to cost around 3.5 billion euros in gross domestic product," said Enzo Weber from the Nuremberg Institute for Employment Research (IAB), according to the dpa news agency on Monday. "That will put another strain on the employment trend in Germany."

Researchers at the IAB, which is part of the Federal Employment Agency, expect the labor market as a whole to remain relatively robust. “Nevertheless, there will be a setback.” The offer for seasonal employees, for example, should be dropped, including numerous mini-jobs. As a result, the number of short-time workers will increase by several hundred thousand.

Rapid re-employment is then decisive for a restart of the labor market. In addition to the experience with the lockdown measures and the state financial injections, the upcoming vaccination approval above all gives “a perspective of an end to the acute Covid phase,” said Weber. "Many companies will therefore try to keep their employees."

Ministry of Economic Affairs expects economic downturn
The Federal Ministry of Economics warned in its Monday report published on Monday of an economic setback. "The economic catch-up process has recently continued, but the course of the pandemic poses a risk," it says. The measures that have been in force since November and have been tightened from this Wednesday put a strain on the catering, leisure and tourism sectors in particular.

"With the recently decided hard lockdown, other areas are now also affected," said the ministry. "All in all, economic growth in Germany is likely to suffer a noticeable setback in the fourth quarter." Other economists are currently assuming that gross domestic product will decline in the current fourth and first quarter of the coming year.

"Back at the point when Germany was considered the sick man of Europe"
Meanwhile, the new president of the German Employers’ Associations in the Metal and Electrical Engineering Industries Gesamtmetall, Stefan Wolf, gave the federal government a bad report. His industry is not just doing badly because of the Covid crisis. The politics of the past few years have also massively damaged Germany as a business location.

"In Germany we are back to the point at which we were at the beginning of the 2000s, when Germany was considered the sick man of Europe," Wolf told Welt am Sonntag. "And now the point has come where companies say that the relocation pays off." Especially since countries like Bulgaria or Romania would advertise German companies with subsidies and tax breaks.

In the upcoming collective bargaining round, he called for a zero round as well as extensive opening clauses so that companies could survive the crisis. “I don't see any room for maneuver. And we have to clear out the tariff landscape and get certain discounts.

Source: Junge Freiheit
Germany: The new lockdown costs 3.5 billion euros per week Germany: The new lockdown costs 3.5 billion euros per week Reviewed by PostDiscus on December 15, 2020 Rating: 5

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