Very good sentiment in the crafts trade, but the sector still faces challenges

Sentiment in the crafts trade is good. According to the German crafts trade federation (ZDH), the year started off very well for the skilled trades sector which employs one eighth of all wage earners in Germany and more than one quarter of young persons in vocational training. In the first quarter 2017, new records were broken in the areas of revenue and employment as well as business conditions and investments. The main contributions to this development came from the building and interior finishes trades that are profiting from the consistently strong demand for housing and real estate in metropolitan areas.

However, the encouraging news should not blind us to the many major challenges still facing the German crafts trade. These include successor problems, competition from industry and foreign suppliers as well as mounting demands in connection with technical progress. However, the main source of concern is the growing shortage of skilled manpower which could cause major bottlenecks in the crafts trade. A shortage of new recruits in the building and interior finishes trades could give rise to an investment backlog in residential and commercial construction. Yet the construction trade plays a vital role in aggregate economic investment. Without the crafts trade, virtually no construction investment could be realised, given that construction investment accounts for nearly half of Germany’s aggregate investment. Growing problems in the crafts trade therefore pose a threat not only to economic growth but also in the long term to the potential growth of the entire economy.

First and foremost it is up to the crafts trade itself to find solutions for mastering these challenges. And this is already happening. Qualified personnel are being more closely tied to the companies and retained even when order intake is weak. At the same time, crafts traders are responding to the lack of manpower by making greater use of machinery and deploying industrially pre-fabricated components. In the crafts-based food industry, larger-sized crafts traders are expanding and employing industrial production methods themselves. At the same time, smaller crafts traders are keen to distance themselves from mass production by relying on quality, individual solutions and by being deeply rooted in their home region.

However, the efforts to take on the challenges must be stepped up if the crafts trade is to be made more attractive for young recruits and skilled workers. Possibilities are, for example, developing relevant vocational training concepts or partnership alliances in the form of shared marketing. Particular attention must also be given to digitalisation. The „Handwerk 4.0“ initiative is preparing the crafts trade sector for the next generation and putting the industry in an attractive light for young people.

Due, however, to the key function of the crafts trade for aggregate investment, the involvement of the state is also required. It should support the digitalisation of the crafts trade and other industrial sectors by offering advice solutions, development measures and ensuring the swift expansion of technical infrastructure – key word: nationwide high-speed internet. At the same time it is important to create a range of study courses that are strongly practice-oriented and especially customised to the needs of the crafts trade in order to build a bridge between studying and managerial responsibility in the crafts trade.

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