Talk about semantics, because Germany would already be in a recession if the old rule were followed. “If GDP contracts for two consecutive quarters, there would already be a recession,” says De Jong. “So it’s actually already started in Germany, because in the fourth quarter of 2022 and in the first quarter of this year, the German economy contracted slightly.”
“The number of unemployed has increased by 250,000 people in one year”
Nor is it a sharp rise in unemployment, which, according to De Jong, people often associate with a recession. However, that doesn’t mean that there isn’t an increase in unemployment in Germany, on the contrary: “A year ago it was 5.0 percent, now it’s 5.6 percent,” he continues. “The number of unemployed has increased by 250,000 people in one year, so I would definitely say that the recession has already started.”
Swing
While industrial production in Germany fell by 3.4% in March, the same production increased by 2.1% in February. According to De Jong, this change is not surprising because the monthly figures can vary widely. Instead, he prefers to look at the annual figures. For example, the amount of orders from the industry was ten percent lower in March than in February, “and even eleven percent lower than in March last year,” De Jong continues. ‘Of course you can imagine that the orders position looks a bit ahead of what’s to come compared to production itself. So these are not good figures for Germany.’
Netherlands
And this will also have an effect on the Netherlands, says De Jong. Especially since the German economy is the largest in the eurozone, because it is our neighbor and because it is our most important trading partner. ‘In recent years, our industry has managed to resist the downward trend of German industry,’ concludes De Jong. ‘Our industry has clearly done better. I think it’s due to composition, because they mostly make cars and we make semiconductors. But what you have seen in the last few months is that the Dutch industry is getting tougher than the German one. So if they fall, it won’t help us.’