Brussels, 02 Feb 2005

Germany may lose more jobs in research and development (R&D) industries, as the vast majority of companies do not plan to increase research spending at home before 2008, warns a new survey.

According to the survey - carried out by the DIHK, the umbrella organisation for German chambers of commerce - about half of all German companies that invest in R&D abroad have been reducing their research capacities at home.

The survey, which covered 1,554 German companies, found that nearly one in five companies plan to move R&D capacities outside Germany by 2008. 15 percent of companies have already done so. The survey also found that one in three companies in the engineering, automobile and information technologies industries conducts some of its R&D activities abroad, generally within the EU25. 28 per cent of German companies with a foreign R&D presence have based them in Asia and North America.

These plans 'pose a very considerable threat to Germany as an industrial centre,' said DIHK President Ludwig Georg Braun. 'It's a worrying development.'

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'Germany's appeal as a place to conduct research is fading,' he added, 'and it will fade further if the government fails to react.'

The shift of highly qualified R&D jobs is more obvious among companies that have moved production capacities to low-cost labour markets, which leads to an 'offshoring' spiral, believes the DIHK, which represents 3.3 million companies.

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As Mr Braun explained, the increased availability of cheap qualified labour is the major reason behind the increase in offshoring. However, he added, industry-averse legislation, both at EU and national level, are also a factor in driving entire value chains away from Germany.

For more information about the DIHK (in German) please visit:

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