DW: Germany is seeking to transform the country’s defense industries into a haven that will stimulate the economy and provide more job opportunities
German labor market expert Professor Enzo Weber predicts a sustained and long-term recovery in the German defense industry, driven by increased defense spending.
Professor Weber, who is an expert at the Institute for Employment Research and Labor Market (IAB) in Nuremberg, told the German Press Agency (dpa) on Saturday that the upward trend in the sector will be sustainable and continue for many years.
The director of the Institute’s Macroeconomic Forecasting and Analysis Department pointed out that exempting defense spending from borrowing restrictions opens the door to financing guarantees, enhancing the government’s ability to support the sector.
According to a study conducted by the institute, increasing German defense spending from 2% to 3% of GDP, financed by loans, could create up to 200,000 new jobs.
Weber called on the government to use these financial resources to bring about a qualitative transformation in the industry by promoting innovation and competition.
He added, “The challenge now is whether these funds will be used solely for spending, or whether they will also contribute to achieving actual industrial renewal”.
Unlike many other sectors experiencing decline, Weber believes that Germany’s defense industry has been experiencing a sustained boom for nearly two years, noting a significant increase in the number of employees working in this sector, while employment in other industrial sectors is clearly declining.
At the defense industry group Rheinmetall, for example, the number of job applications from Germany rose from around 59,000 in 2021 to 175,000 in 2024, with 120,000 of those applications submitted during the first half of this year alone, according to a group spokesperson.
The spokesperson explained that since the beginning of this year, the tank and air defense systems manufacturer has been hiring approximately 500 new employees per month, most of whom are in the fields of production and information technology.
He added that the company is currently seeking employees in product development and production specialties, such as engineers and mechatronics experts.
Augsburg-based Renk plans to continue expanding its workforce in the coming years, but notes that significant improvements in production efficiency may reduce the need for large numbers of employees compared to what was expected in 2023, according to a company spokesperson.
In the same context, Diehl Group reported that its defense division is seeing a steady increase in the number of job applicants estimated at hundreds annually, with more than 1,000 new employees hired in 2024 alone, according to a company spokeswoman, adding that this trend is expected to continue at the same rate through 2026.
It’s worth noting that Diehl company produces defense systems such as the Aris-T air defense system, which is also used in Ukraine.
In this regard, Professor Weber believes the defense sector represents a significant opportunity to reintegrate skilled workers from other declining sectors, particularly the automotive and auto parts sector.
He said, “Thanks to targeted consulting and training, skilled workers from these sectors can successfully transition into the defense industry”.
Despite optimism about the sector’s growth, Professor Weber noted that the defense industry remains relatively small and cannot alone compensate for the overall industrial decline in Germany.
He explained that the direct workforce in the arms industry—namely, companies that manufacture weapons, ammunition, and combat vehicles—currently stands at 17,000 people, not including suppliers or companies that manufacture dual-use (civilian and military) products, such as communications systems.
