7. October 2019 Latest economy and HR news
German companies don’t feel ready for digitalization
A Comteam study, published by Handelsblatt, showed that most managers in Germany don’t feel that their companies are fully fit for digitalization. Only 39% of the managers surveyed believe that their company is well prepared for the technical requirements of digitization. Furthermore, managers from larger companies with 1,000 to 10,000 employees are more confident, as over half of them feel technically capable. Technical capability is not just what managers are concerned about: 55% of managers believe that digitalization requires accompanying cultural work. However, two thirds of those surveyed feel that the cultural preparation for digital change in their company is not or only moderately sufficient. In organisational terms as well, only a third of respondents believe their company is ready for digitization. Further implementation of e‑learning is of great importance to managers, such as the use of Learning Management Systems (LMS).
Unexpected decline in joblessness in Germany
After months of concern that Germany could fall into a recession, it has been reported this month an unexpected drop in joblessness. Bloomberg reported that the number of people out of work fell by 10,000 to 2.276 million in September. However, those who were registered in this number were amongst those receiving basic security benefits. Unemployment still continues to increase. The labour market in Germany has been affected by a slump in exports and the manufacturing industry is already in recession. In response to the joblessness rates, despite some concerns being eased by the drop this month, the German government has signalled that it would step in with fiscal support but does not see the need to act so far.
EU Brexit deal decision “at end of the week”
French President Emmanuel Macron has told Boris Johnson that the EU will decide at the end of the week whether a Brexit deal will be possible. UK and EU negotiators will meet this week to come to an agreement, which Macron said should “respect” EU principles. According to the BBC, Johnson will hold calls with the leaders of Sweden, Denmark and Poland today, after speaking with Macron yesterday, to discuss his latest proposals for the Irish border. Despite claiming that Parliament is supportive of his Brexit plans, Jeremy Corbyn is organising a cross-party meeting between Labour, the SNP, Lib Dems, Greens and others to scrutinise next Brexit proposals and to “hold the government to account”.
Income gap continues to widen
A recent study from the Wirtschafts- und Sozialwissenschaftlichen Instituts (WSI), reported that the inequality of income in Germany has reached a new high, with the gap between the affluent and the lower income groups has widened even further in recent years. WSI expert, Dorothee Spannagel, stressed that the inequality has been growing much more slowly than at the beginning of the millennium, but the gap between the very poor and the very rich is widening constantly. In order to counteract the growing inequality, the WSI experts recommend a whole bundle of government measures. Manager magazin summarized WSI’s suggestions: from strengthening collective bargaining to increasing the minimum wage and increasing taxation on top incomes and very high inheritances.
AMS vowed to keep pursuing the acquisition of Osram Licht
In a statement on Friday, AMS said that Osram investors tendered 51.6% of their shares, falling short of a 62.5% threshold set by the Austrian Apple Inc. supplier for the deal to be successful. Despite failing to garner enough support from shareholders after its 4 billon euro bid to takeover Osram Licht AG, AMS AG has vowed to “explore strategic options” for a takeover. Osram, which has been struggling with a market slowdown, emerged as a takeover target last year and confirmed talks with Bain and Carlyle in February. However, a bidding war broke out in July when AMS lobbed a higher offer. AMS is still the highest shareholder in OSram, with a 19.99% direct holding. AMS CEO, Alexander Everke said in a statement in response to the failed acquisition, “we intend to leverage our position as Osram’s largest shareholder in a dialog with Osram as we continue to pursue the full acquisition of the company.” Read the full article here.
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Your Glasford International Deutschland Research and Analytics Team