What Can Save the German Economy?
Welcome back to the Recruitonomics Newsletter! This week, we’re looking the proposed increased military spending in Germany, and what that may do for the economy and labor market.?
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This Week on Recruitonomics:??
Can Increased Defense Spending Save the German Economy??? ?
Recently, Germany has faced political turmoil. Late last year, Chancellor Olaf Scholz’s coalition collapsed amid internal disputes over fiscal policy and defense spending, crippling the government. The CDU/CSU, winner of the February election, is charged with creating a new coalition government and lifting Germany out of recession through increased military spending. But can increased defense spending really help economic growth? In Germany, it’s very possible. For one, most of the money poured into equipment investment will remain in the country, as the domestic defense industry is relatively large, and the government would primarily order from German producers. Additionally, with car manufacturing currently in crisis, military producers could absorb some of the employment losses occurring in the car industry, boosting employment. This proposed increase in military spending, therefore, would address two massive crises: an economic recession and a rundown military during a fraught geopolitical moment.?
Read the full article here.?
What does this mean for recruiters???
For recruiters in Germany, this new investment could rejuvenate hiring, especially in the manufacturing sector. With the state of the German economy over the last couple of years, that would be a welcome change for recruiters.
Recruiting Tips:
In the next webinar from Appcast, Chief Economist Andrew Flowers is going to unspool the recent changes in the federal government and trade policy, with a focus on what it means for recruiters. Register today for the webinar The Recruiting Implications of the Recent Economic Shifts, happening on Wednesday, March 19th at 2:00pm. ?
Recently on Recruitonomics:?
Despite DOGE Blitz, Hiring Continues to Tick?
The first two months of President Trump’s new administration have been a whirlwind of policy changes. The flip-flopping tariff policy has created economic uncertainty, and the Department of Government Efficiency has chipped away at the federal workforce. But the labor market is, as ever in this post-pandemic world, resilient. In February, the U.S. economy added 151,000 net new jobs and the unemployment rate barely increased to 4.1%. This report indicates two things: First, the labor market is growing at an incredibly steady rate, shrugging off short-term uncertainty. And though hiring is still healthcare-heavy, other sectors like transportation, construction, and information have all seen growth in recent months. Second, DOGE’s efforts to reduce the federal workforce are materializing in the data. Federal Government employment fell by 10,000 last month, the largest one-month drop since mid-2022. The full impact of this initiative will take many months to unfold in the data, but this is the first sign of what’s to come.?
Read the full article here.?
What Recruitonomics is Reading:??
February’s consumer price index (CPI) report came in cooler than expected, with prices up 2.8% from the year before. Core inflation, which is stripped of volatile energy and food data, was up 3.1%, the smallest increase since the beginning of 2021 before inflation took off. It was an encouraging report considering the past few months of rising prices and should be a comfort for consumers. Even grocery prices, which were splattered across headlines last month, were flat over the month despite the high egg prices. The Federal Reserve has another interest rate decision to make next week, and despite this relieving report, the FOMC may feel called to keep rates stable considering the uncertain impact of tariffs.?
More Data & Insights:?
Thank you for reading! Stay tuned for next week's Recruitonomics Newsletter and check out Recruitonomics.com for more data-driven insights.