“Something is rotten in the state of Denmark.” The quote from Shakespeare’s Hamlet could also be applied to Germany at the moment – at least as far as the government’s efforts to create a business-friendly environment are concerned. At any rate, the efforts seem either to be entirely lacking or at best moving in the wrong direction.

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At the top of the list of issues are the labour costs and shortage of skilled labour, prices for energy and raw materials, excessive bureaucracy, and the serious weakness in the infrastructure. The information emerged from a flash survey by the federation of German industries, BDI (Berlin; www.bdi.eu), among 400 small and medium-sized companies. “There is simply no all-clear for the situation existing in Germany as an industrial location,” said BDI president Siegfried Rasswurm.

The consequences of the lack of political orientation are that 16% of the companies questioned are already actively occupied in shifting some of their production, and jobs, abroad. Another 30% are thinking in concrete terms about doing so. “For more investment, the industry needs a noticeable reduction in bureaucracy and targeted tax reductions,” says the BDI. The most popular destinations for production are other EU countries (29%) and North America (20%), while China (8%) – certainly also against the background of increasing tension with its neighbouring countries – no longer has any great appeal. A small glimpse of light is that 3% of the companies actually want to bring back production processes or jobs to Germany.

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In view of the weak economic situation, 15% of the companies questioned have also cut back their production or halted it completely. That is 6 percentage points more than in the previous survey in September 2022 and 8 percentage points more than in February 2022.