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Functional Restructuring in Manufacturing: Increasing Importance of Production-Related Services

Press Release of August 13, 2014

There are fewer and fewer people employed in the German manufacturing sector. Between 1999 and 2013, the number of people working in the industry fell from 7.7 million to 7.3 million. However, not all areas have been equally affected by the decline, rather, there has been a functional restructuring within the industry: while fewer people are being employed in production, employment in many production-related services in the industrial sector, such as research and development (R&D), technical services, and management and organization functions have actually grown. Export-oriented industrial companies, in particular, have expanded their research and development divisions, but firms focusing on the internal market have also significantly increased their R&D activities. That the share of employment in production is falling does not necessarily mean that this area is becoming less important. On the contrary, the production area's demands for a qualified, skilled labor force is high, in export-oriented as well as in sectors focusing on the internal market. The trend toward tertiarization in industry is likely to continue in the future, not least due to the increasing digitalization of information: routine activities will continue to become less important, demanding activities - also in production - will become more important.


Topics: Industry