The general mood in Germany's contract cleaning sector

12th of August 2022 Article by Katja Scholz
The general mood in Germany's contract cleaning sector

For the fourth year in succession now, the Federal Guild of Contract Cleaners (BIV) has carried out a spring survey. This enables BIV member companies to present a picture of the general mood in the sector and to give their views on market forecasts, revenue projections and topics of current interest. Hence this year's spring survey also reflected the war in Ukraine and its repercussions.

Both the influx of refugees and the repercussions already making themselves felt within Europe were addressed in the survey. Almost 83 per cent of the companies polled declared their readiness to offer Ukrainian refugees a (temporary) job.

"We all hope that the war will be over as soon as possible and people can return to their home country again" said BIV guild master Thomas Dietrich. "As long as employment or at least temporary employment helps to provide positive support for the refugees, our outward-looking industry will be more than willing to offer assistance."

Aside from the current war in Ukraine, the contract cleaning trade in Germany is well-known for its cultural diversity and its role in promotion integration in the employment market - some 40 per cent of all employees come from an immigrant background.

One of the most noticeable effects of the war in Ukraine is without doubt the enormous rise in the price of electricity, gas, oil and petrol. As a service provider which relies on mobility, the contract cleaning trade has suffered badly from these cost pressures. On a scale of 1 to 10, the companies questioned rated the influence of rising energy prices at 7.3 as a significant source of pressure on their budgets.

The second dominant theme at the present time - the Covid-19 pandemic - is likewise still having a marked effect on the situation of the companies themselves. A total of 90.8 per cent indicated a clear rise in the sickness rates of their employees in recent months, 62 per cent reporting a significant rise and just under 29 per cent a slight rise.

Short-time working, however, is less of an issue for companies at present: just short of 90 per cent of the companies questioned currently have no employees on short-time working - on the contrary, almost the same percentage of companies can actually see themselves increasing the number of employees. In this case, they also identify a problem at the moment of finding suitable people. In Autumn 2021, readiness to hire new staff stood at only 69.2 per cent.

And what do revenue projections look like for the current year? According to the survey, these remain fairly mixed: while 46 per cent of the companies questioned anticipate increasing turnover, a good 32 per cent expect turnover to remain stable, while just under 21 per cent actually forecast a decline.

But the effects of rising costs are not only being felt by the companies themselves. Whether as a result of the war in Ukraine, supply chain bottlenecks, rising energy prices or the continuing uncertainties caused by the pandemic - employees are being hit hardest of all by the high level of inflation.

"Employers in the contract cleaning trade have for decades been convinced of the importance of independent collective wage bargaining. It is not for politicians to determine wage levels but for social partners to find mutually acceptable answers to the many and varied sector-specific demands of the employees," declared Christian Kloevekorn, chair of the BIV Wage Bargaining Committee (Tarifkommission), at the start of the collective wage negotiations in Spring this year.

The results were announced at the beginning of June: in the second round of negotiations the parties concerned agreed on a two-stage increase in the universally applicable sector minimum wage and a rise in apprenticeship allowances.

"Set against a backdrop of extreme economic risks and imponderables for companies, the wage increases are approaching the red zone, though the long duration to the end of 2024 is a strong argument in their favour. The agreement underscores our fundamental belief that entry-level wages in the contract cleaning industry should continue to significantly exceed the legal minimum wage - this is even more important in times of historical inflation and increasing labour shortages," said Christian Kloevekorn on announcing the outcome of the negotiations.


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