German chems, union committed to avoiding job cuts

28 October 2009 16:04  [Source: ICIS news]

TORONTO (ICIS news)--Germany’s chemical employers and chemical union IG BCE on Wednesday reiterated their commitment to avoid job cuts despite continuing challenges from the tough economy.

After a top-level meeting in Ludwigshafen, Eggert Voscherau, the head of employers group BAVC and chairman of BASF’s supervisory board, and union leader Michael Vassiliadis said in a joint statement that job cuts could only be the very last resort.

Their commitment comes as many economists predict rising unemployment for Europe’s largest economy into 2010, despite sequential improvements in business conditions.

Voscherau and Vassiliadis acknowledged that the global economic and financial crisis had hit Germany’s chemical industry hard.

Production and sales had plummeted, and capacity utilisation was at a historic low, they said.

While some producers were recovering, others remained stuck in the crisis, they said.

“Even though the trough has been reached, it will take a long time until the chemical industry regains its pre-crisis production levels,” they said.

Union and employer highlighted the importance of government-supported short-time work and other policy instruments that had enabled producers to retain staff amid the crisis.

They also urged Chancellor Angela Merkel’s new coalition government to do more to recognise the importance of industrial production for Germany.

Germany was coping better in the crisis than many other countries that were too exposed to the services sector, and were now paying the price, they said.

However, if Germany was to retain its lead, politicians, along with companies and unions, needed to support the chemical industry.

In particular, all parties needed to help in setting conditions that will allow new technologies, such as nano- and gene technologies, to be developed in Germany, thus creating new production and employment in the country, they said.

In related news on Wednesday, Berlin-based economic research institute DIW said that Germany’s economy likely grew by 0.8% in the third quarter, from the second quarter.

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