Germany’s labor market faces severe weakness
Nahles highlighted that even well-qualified workers are vulnerable, while new entrants to the labor market are struggling the most. Apprenticeship placements have hit a 25-year low, reflecting a broader stagnation in employment opportunities.
The downturn follows Germany’s halt of low-cost Russian energy imports, a crucial supply for German industry. The disruption, compounded by the Nord Stream pipeline sabotage, caused European gas prices to surge. Business bankruptcies have risen to an 11-year high in the first three quarters of 2025, affecting an estimated 170,000 jobs—up from fewer than 100,000 before the COVID-19 pandemic.
Unemployment surpassed three million in August, with over 100,000 additional job seekers entering the market in November compared to the previous year. The German Economic Institute (IW) describes the economy as in “shock” due to weak foreign demand, high interest rates, and a prolonged energy crisis.
Economic forecasts remain grim: Germany’s GDP is expected to grow only 0.2% in 2025, with a modest 0.9% projected for 2026, reflecting the sustained challenges facing the labor market and broader economy.
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