Crisis alarm in the East: Chemical industry is threatened with massive job losses!

Crisis alarm in the East: Chemical industry is threatened with massive job losses!

East Germany is facing a serious crisis in the chemical industry, compounded by energy shortages. The future of the US company Dow's plants in Böhlen (Saxony) and Schkopau (Saxony-Anhalt) is currently being examined in detail. How Focus reported, a decision should be made by the end of July 2023. Union leader Michael Vassiliadis urges us to hurry: Hundreds of jobs and the region's industrial future could be in jeopardy.

The cracker in Böhlen, which breaks down intermediate products for the chemical industry, plays a central role for the Bitterfeld-Wolfen chemical park, which has around 15,000 employees, including many in dependent companies. The shock could reel the entire region if the shutdown becomes a reality. Unfortunately, it turns out that the chemical industry in eastern Germany is suffering from high energy prices and lower capacity utilization. The utilization of energy-intensive industries fell from 85 percent in 2021 to below 75 percent in 2024.

Job cuts and short-time work

The alarming numbers do not go unnoticed. Employment in the East German chemical sector is falling for the fourth quarter in a row; current capacity utilization is just 73 percent. While the Leuna Chemical Park has already implemented austerity measures, Wacker Nünchritz is planning to put 200 positions on short-time work starting in January. Analyzes of Economy in Saxony highlight that the company has to act due to high electricity prices and weak demand for polysilicon.

In addition, the current difficulties are particularly threatening for manufacturers of basic chemicals. The concerns about the location are also shared by Saxony-Anhalt's Prime Minister Reiner Haseloff. He is seeking a conversation with the President of the EU Commission and is calling for a return to price caps and easing of the Green Deal. “There is a risk of companies migrating from Central Germany,” warns Haseloff.

Political action urgently needed

The desperation in the industry is clearly noticeable. A third of the approximately 55,600 employees in the East German chemical industry are employed in Saxony-Anhalt. The industry's sales growth since reunification is unmistakable, but last year German chemical production fell by twelve percent MDR reported. “We need political support,” appeals Nora Schmidt-Kesseler, general manager of the Nordost-Chemie association, and calls for a reduction in network fees and an industrial electricity price of just 4 cents per kilowatt hour.

Given all these challenges, the future of the chemical industry in East Germany remains uncertain. The demands for political support are loud and clear, but the necessary financial resources have become scarce. Decisive measures are needed to maintain competitiveness and secure jobs.