German Car Companies Focusing on E-Mobility are Looking for More Workers

German companies in the automotive industry focusing on electromobility are looking for significantly more workers than those focusing on combustion technology. This is according to a study by the ifo Institute and the online job platform Indeed of over 1.5 million job ads in Germany. While labor demand followed a similar trajectory until spring 2019, since then the demand of companies focusing on electromobility has been 34 to 50 percentage points higher on average than for companies focusing primarily on conventional engines. At the end of 2023, the difference was as high as 60 percentage points. Since the beginning of 2024, however, the gap is narrowing again.

Even before spring 2019, companies focusing on electromobility were looking for more professionals in the fields of software development, industrial engineering, and sales and sought fewer technicians, mechanics, and logistics personnel compared to companies focusing on combustion technology. “The differences in labor demand reflect the profound structural shift in the automotive industry,” says Oliver Falck, Director of the ifo Center for Industrial Organization and New Technologies. “With intensified competition, global trade conflicts, the pandemic, the war in Ukraine, and the energy crisis, the structural transformation in the German automotive industry has accelerated considerably.”

“Companies in the automotive industry perform better on the labor market when they focus on electromobility. The combustion engine as the classic domain of German engineering loses importance as a job driver,” says Annina Hering, labor market economist at Indeed. At the same time, other areas, such as software, are becoming increasingly important due to a stronger focus on infotainment or automated driving. “The structural transformation requires fundamentally new business models that are more digital, for example leading to sales strategies with more direct marketing,” says Moritz Goldbeck, co-author of the study. However, current weak consumer demand and the renewed discussion about the phase out of internal combustion vehicles are causing increased uncertainty and slow down the transformation to electromobility noticeably.

The study examines over 1.5 million online job ads from Indeed from January 2018 to April 2024, which corresponds to the labor demand of 2,166 companies in Germany active in the automotive sector. The companies are differentiated according to their patent portfolios in powertrain technologies.