Structural change: What effects will result from the ongoing deindustrialization of energy-intensive industrial sectors?
The disappearance of well-paid industrial jobs in Lusatia – triggered by rising energy prices and the politically driven phase-out – is a highly explosive and profound problem. This development threatens to bring about a permanent deindustrialization of energy-intensive industries and brings significant social andeconomic consequences.
Background of the Lausitz district
Lusatia was an important industrial center for many decades, which was primarily characterized by lignite mining and energy-intensive industries such as chemicals, metalworking, glass production and mechanical engineering. After the German reunification, the system change, together with the declining competitiveness of numerous companies, led to a massiveDeindustrialization, accompanied by high unemployment, emigration and an increasingly aging population. The number of employees in the lignite sector fell from almost 80,000 at the end of the GDR to under 8,000 in the mid-1990s. Even today, this development still shapes the dynamics of the labor market in the region, which remains economically weak compared to other areas.
Impact of rising energy prices and coal phase-outs
The current political decisions – in particular the decided exit from coal-fired power generation – make Lusatia again with full force. The energy-intensive industry is heavily dependent on low electricity prices. The change from lignite to renewable energies increases energy costs, as inexpensive base load capacities are being eliminated and new capacities are only createdhave to be. This cost explosion is putting companies in the chemical, metal and glass sectors under massive pressure. They are either threatened with relocation to regions with lower energy costs or even the closure of entire locations – which immediately means the loss of numerous jobs.
unstoppable deindustrialization
It is becoming increasingly clear that the loss of central industrial workplaces can hardly be stopped. For the currently around 6,500 employees subject to social security contributions in the coal and energy sectors and for the employees of other energy-intensive sectors, the previously announced investments and support programs cannot be adequatelyoffer replacement. Most of the new positions are located in the service sector or in highly qualified segments, but usually do not reach the wage level or the employment conditions of the previous industrial jobs. Since many support measures for new industries have not yet been implemented or have only been announced, short-term solutions are missing. The danger isReal that the region is permanently losing industrial substance, triggering a downward spiral of skilled workers, value-added losses and lack of investments.
Devastating consequences for the population
Social descent: If you lose your qualified and comparatively well-paid work, you will usually find only poorly paid alternatives – this worsens the individual situation of life and increases the risk of poverty. The emigration of young, qualified people in particular accelerates the demographic aging process. The region suffers from a decline in the labor forcewith increasing aging, which endangers the carrying capacity of social security systems. The closure of large companies has destroyed long-standing social structures and the regional identity that was closely linked to industry and working life. Declining tax revenues and shrinking economic power also deteriorate infrastructure, educational opportunities andquality of life further. Lack of prospects also lead to growing political frustration and can promote anti-democratic currents.
Critical consideration of the political countermeasures
Although state programs with investments in billions and structural aid exist, there is a lack of secure, large-scale industrial projects that could serve as a replacement for lost jobs. To make matters worse, structural change is progressing slowly: funding often focuses on smaller companies and administrative units, while theformative large-scale companies in the region suffer directly from the restructuring. Many measures also remain pure announcements – for employees, this means a phase full of uncertainty and fear of social decline.
The loss of well-paid industrial jobs has a direct and indirect impact on the population
The combination of politically forced phase-outs of coal, rising energy prices and the lack of substantial substitute industries massively threatens the economic livelihood of Lausitz. There is a threat of permanent deindustrialization of entire areas, which means unemployment, financial uncertainty and a further decay of regional infrastructure for people. thePrevious political answers and aid programs do not go deep enough to stop this process or at least to weaken it effectively.
