Companies Shift Tens of Thousands of Jobs Abroad - German firms move abroad, cutting 50,000 jobs in cost-driven exodus
Between 2021 and 2023, around 1,300 German companies with at least 50 employees moved parts of their operations abroad, affecting thousands of jobs and reshaping the countryâs employment landscape. The shift was driven by cost concerns and strategic business decisions. In 2023, 59% of German firms with 50 or more staff were linked to global value chains, either importing supplies or exporting goods. Yet, during this period, 1,300 such companiesâ2.2% of the totalârelocated business functions overseas, with 900 firms choosing destinations within the EU and 700 others moving operations outside the bloc. Lower wages topped the list of reasons for relocation, with 74% of companies citing this factor, followed by strategic decisions such as market expansion or restructuring at 62%. Other motivations included cost savings beyond wages and difficulties finding local workers. The move had a significant impact on employment, with around 71,100 jobs cut in Germany due to offshoring. However, restructuring and efficiency gains created 20,300 new positions domestically, resulting in a net loss of approximately 50,800 jobs. Companies also faced challenges when relocating, including legal and administrative hurdles, tax issues, and high relocation costs, with the manufacturing sector experiencing the most disruption from these shifts. The relocation of German businesses between 2021 and 2023 led to a net loss of over 50,000 jobs, highlighting how cost pressures and strategic priorities continue to reshape the countryâs industrial landscape.
