More than half of Germany’s small and medium-sized enterprises think Europe’s biggest economy could contract next year, hobbled by slowing global growth, trade disputes and a stuttering auto sector.
Almost 53 percent of so-called “Mittelstand” companies surveyed by the BVMW industry association fear that a recession could strike in the next 12 months, the group said Friday. A disorderly U.K. exit from the European Union is also a threat.
The downbeat sentiment contrasts with the end of 2017, when the country had just experienced a year of vibrant growth underpinned by robust domestic spending and flourishing global trade.
Economic data have weakened significantly since then, with economists divided about whether they signal a slower but stable continuation of the expansion, or the start of a downturn.
A persistent shortage of skilled labor is also dampening growth prospects, with more than 92 percent of small and medium-sized enterprises having difficulty filling vacancies, the BVMW said. The group represents around 270,000 firms employing some nine million workers, according to its website.