Germany's Job Vacancies Slip to 1.15 Million as Skills Mismatch Worsens – Industry Orders Plunge

A sharp disconnect between the jobs on offer and the qualifications of unemployed workers is deepening Germany’s labour market headache. The Institute for Employment Research (IAB) counted just 1.15 million open positions in the first quarter of 2026 – a drop of roughly 105,800 compared with the final three months of 2025. Yet of the 2.23 million people registered as jobless, nearly half – 48 percent – lack any formal vocational training. Only 24 percent of the vacant posts require no professional qualifications.

“Demand for labour is stagnating at a low level,” said IAB researcher Alexander Kubis. Statistically, 264 unemployed persons now compete for every 100 vacancies.

The sinking number of open jobs coincides with a fresh downturn in industrial orders. New orders in manufacturing fell 3.8 percent month-on-month in April, far worse than the 2.2 percent decline analysts had predicted. Machinery and equipment took the hardest hit, sliding 7.4 percent. Car manufacturers saw orders drop 5.3 percent. Electrical equipment suffered the steepest plunge, with incoming orders down 16.3 percent.

Foreign demand overall shrank 4.2 percent, while orders from within the eurozone collapsed 11.1 percent. Jörg Krämer, chief economist at Commerzbank, pointed to geopolitical tensions. “The war in the Middle East is taking its toll,” he said. Germany’s Economy Ministry also noted that some orders were pulled forward into March after the temporary closure of the Strait of Hormuz.

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The weak order books are already feeding through to corporate staffing decisions. A comprehensive analysis by EY shows the industrial sector shed 127,300 jobs in the first quarter of 2026 – a 2.3 percent decline year-on-year. Since 2019, the sector has lost roughly 341,500 positions. Most of the damage has been concentrated in automotive, which has cut 125,800 jobs over the same period. Textiles shrank 22 percent. Two industries bucked the trend: chemicals and pharmaceuticals added 3 percent, and electrical engineering grew 2 percent.

Despite the gloomy order data, production itself eked out a gain. Manufacturing output rose 0.4 percent in April. Construction climbed 2.4 percent, and the chemical industry reported a 2.1 percent increase. Price-adjusted revenue in manufacturing inched up 0.1 percent.

Yet the mood among companies remains tense. According to the DIHK chamber association, one in three industrial firms expects conditions to deteriorate further. Sebastian Dullien, an economist at the IMK research institute, described the coming months as “challenging” and said a sustainable recovery would only become likely once energy prices fall. Analysts at Deutsche Bank Research have not ruled out a recession this summer.

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