Germany, the automotive powerhouse, the engineering marvel of Europe, is bleeding tech talent at an alarming rate. While social media is focused on US tech layoffs, Germany has lost over 12,000 jobs in 2024 alone. The economic engine of Europe is stalling with manufacturing in decline for two consecutive years. So, what's happening? Why is talent fleeing east and south? And most importantly, what does this mean for tech careers today?

This video series is for tech professionals already living and working in the US, Canada, the UK, or the European Union. If you're based outside these regions or in an outsourcing heavy market, the data in this video will not apply to your situation. I do not cover immigration, international job hunting, or topics like how to break into tech without a college degree. If that's what you're here for, this probably isn't the right channel, and that's okay. But if you are operating within these markets, keep watching. There's a lot ahead for various seniority levels and career tracks in tech. This is episode 6 of my video series, Where to Run, where I explore the smartest places for mid to senior tech workers to rebuild post layoffs and postpandemic. And on today's episode, we've got Deutseland.

Germany's tech industry has been among top two most affected in Europe by post-pandemic turbulence and a way of layoffs over the past 3 years. Prior to COVID, Germany had emerged as a major tech hub in Europe, the largest one outside of the UK with an abundance of startups and traditional firms with significant tech labs inside those firms. Nevertheless, since the beginning of the pandemic, with the effects of subsequent mass layoffs, investment priorities and investment volume in Germany has shifted and changes in the work culture reshaped the tech ecosystem very significantly.

More than 12,000 tech jobs were cut in 2024 alone, which is definitely far from the US figure, which is 150k, but still very significant for Europe. Major German employers have each laid off thousands of workers in response to falling profits and a challenging post-pandemic economic landscape. The German manufacturing PMI was 48.4 in April 2025, which is still below the 50 mark that signals expansion. The country had two consecutive years of negative economic growth with GDP contracting.

Now, why is all of this manufacturing data important in the context of Germany even though we talk about tech? This is important because the manufacturing share of Germany's GDP is much larger than that of any other European country. And if Germany has issues with manufacturing, it has a ripple effect on everything else. German industrial and automotive giants make up the backbone of Europe's biggest economy and all of them struggle to cope with macroeconomic headwinds caused by the rising energy prices and falling external demand. Germany is a highly export dependent economy.

Now back to tech. A few data points on some well-known European tech employers. Klarna, a notable Swedish unicorn with a major office in Berlin, reduced its global workforce by 40% between 2022 and 2025. The company does not disclose Germany specific numbers, but Berlin tech roles were particularly affected because Klarna shifted more tech operations to lowercost countries. There are multiple threads on Reddit and Blind with internal people reporting approximate calculations, but I haven't been able to find a reliable number.

Wayfair eliminated approximately 730 jobs in January 2025 as it exited the German market completely and all local roles were either cut or relocated. Revolute implemented a hiring freeze in Berlin in 2024 and offered existing staff to relocate to Spain, Portugal or Poland. The company's Berlin tech team size is not publicly disclosed, but internal employees report a dramatic reduction. So the hiring freeze and the relocation offers indicate a substantial downsizing of the Revolute's German tech operation. US tech giants have significantly reduced or paused hiring in Berlin for 2024 and 2025.

So there is a pattern where tech staff is shifted either to Eastern or Southern Europe, Poland, Hungary, Spain, Portugal, Ukraine and the past but a lot less favored now due to the ongoing war. If it's outside of Europe, the most popular choice is India.

Now, under the Sweden Denmark video, there were a bunch of comments from people saying that the Swedish tech market is absolutely terrible and that there are no jobs. And I often respond to them saying that this is not specific to Denmark or Sweden. It's the exact same thing in Canada and the US and pretty much any other G7 country. And the bigger the series gets, the more you'll see that this is a pattern because yes, the tech market is bad everywhere.

I've been seeing the exact same trend in Canada for several years now where entire departments of devs and QAs are being outsourced. It's always the devs and QAs first that get outsourced then designers and sometimes even PMs. PMs are rarely outsourced simply because the nature of the job requires you to have a very good grip of the market and you have to understand the conditions, the usage patterns, the behavior of the market that you operate in. And when you live outside of the market that you work in or that your product is in, it's really hard to maintain that level of awareness required for the job. But even PMS are being outsourced.

As I was doing research for this video, I spent quite a bit of time looking into why Germany got affected so much. So here is the picture that I'm able to paint after reading tens of reports and LinkedIn posts and research studies and Reddit and blind threads posted by those people who got affected and those who stayed. So, if there's anything I'm missing, please post in the comments. I do want this series to be as detailed and as objective as possible.

So, reason number one, high cost structure and labor laws. Germany historically has had very strict labor protection laws and relatively high wage expectations. And that makes it very expensive for companies to maintain large local tech teams, especially compared to lowerc cost European destinations. As remote work became normalized post pandemic, companies realized that they can hire the exact same quality of talent or similar quality of talent in countries like Poland, Hungary, Spain, and Portugal. And this combined with a large number of Eastern Europeans migrating around Western Europe as a result of the war, companies are now able to hire very high quality talent at a significantly lower cost, prompting a shift of roles outside of Germany.

Reason number two, salary expectations and the cost of living. The rising cost of living in Germany, especially in high-cost cities like Munich, often drives tech professionals to seek very high and competitive compensation. But many tech companies, especially startups, simply cannot afford it. They cannot meet those expectations due to budget constraints, especially in a volatile economic climate. on top of this at the tariff war when God knows how that's going to end. So most companies simply cannot afford having their teams in Germany.

Reason number three, regulatory and policy uncertainty. Many tech companies site Germany's increasingly unpredictable regulatory and tax environment as a deterrent. Rapidly introduced regulations such as the supply chain act and complex bureaucracy that Germany is known for make it less attractive for tech investment and expansion compared to more agile European markets.

Reason number four, shift in skill demand. The types of skills that German tech companies are looking for have evolved. Emerging tech such as machine learning, data science, IoT, blockchain are in demand. Job seekers whose expertise does not align with high demand areas find it harder to land offers simply because a lot of traditional programming roles are being actively outsourced.

Now, a quick reference to my previous Sweden and Denmark video because there were a bunch of people in the comments saying how incredibly terrible the Swedish tech market is and that there are no jobs. In the interest of being fair, here is the comparison of the layoff impact, just the layoff impact between Sweden and Germany. Starting with Germany.

Germany alongside the UK has become one of Europe's hardest hit countries for tech layoffs since 2022. Between 12 and 19,000 jobs were lost. This is the highest number in Europe after the US. Layoffs have been persistent across startups and large tech firms with many companies also offshoring roles to lowercost countries. This trend is expected to continue with one in three German companies planning further job cuts in 2025. The German tech workforce faces increased job insecurity and the sector's recovery has been hampered by economic stagnation as well as regulatory hurdles and a shift of jobs abroad.

Now, let's look at Sweden. Sweden's experienced a very sharp spike in layoffs at the very start of the pandemic. It was approximately 27,000 jobs cut across all sectors, including tech. I wasn't able to find the exact number and reliable number specifically for tech jobs, but the tech sector's layoffs were smaller in scale and shorter in duration compared to Germany. Sweden holds the title for the highest reemployment rate in the developed world. More than 80% of laid-off workers find new jobs within a year, which is the best rate in the developed countries.

By 2024 and 2025, Sweden's tech industry recovered much better than that of the rest of Europe with high demand for specialized talent and a wonderful startup and innovation ecosystems. The sector has shown remarkable resilience with layoffs mostly limited to high-profile cases like Spotify and Northworld and no sustained wave of tech job losses in 2025. So to be fair, while the tech market is bad pretty much everywhere, Sweden's not exactly a disaster.

Quality of talent. German tech talent is highly educated. Education in Germany is of very high quality, and it's very affordable because public universities charge little to no tuition fees, making education accessible to both domestic and international students. And at this point, all North Americans listening to this got a little tear rolling down their face because most of us graduate with tens of thousands of dollars in debt. sometimes hundreds of thousands of dollars.

Germany has lots to be proud of, and I'll do a breakdown by the city.

Berlin. Berlin is Germany's top startup hub, home to unicorns like Zelando, N26, Delivery Hero, and several very promising autonomous driving startups. N26 apart from being a very solid NEO bank with more than four million users and a nine billion dollar valuation at its peak is widely recognized as the breeding ground for entrepreneurs with at least 34 startups founded by N26 alumni. Delivery Hero for those of you who haven't heard about it is one of the world's most successful food delivery companies with a global reach comparable to Uber Eats. Deep L is another notable mention except it's based in Cologne, not in Berlin.

Now, please don't come at me and be like, "Yeah, well, those firms exist, but how many people work there?" It's not about who works there and who doesn't. It's a fact that the country either produces or gives the freedom to top-notch talent, and not every country can brag about it. Berlin's and Munich's tech scene is evolving into innovation hubs focusing on AI, internet of things, autonomous driving, blockchain, and software engineering within the industries that Germany has historically been known for, automotive, manufacturing, and financial. Nevertheless, for the third year in a row, the annual salary survey for the tech and startup sectors reveals a concerning trend. Median salaries have stagnated in Germany.

Moving on to Munich. Munich combines a very strong industrial base with a thriving startup scene and is known for IoT, advanced manufacturing, robotics, and traditional software development. Munich's notable babies are Salon, Personio, Flicks, Liliam, and many others. Munich boasts a dense concentration of STEM students. 43% of them are local graduates and that is the highest number among the German cities. Munich regularly ranks as one of the world's best cities for quality of life, making it attractive for talent retention and recruitment.

Hamburg. Hamburg is gaining recognition as the top tech city, ranking number two in the 2024 talent city index after Berlin, but ahead of Munich. They're known for Zing, several gaming companies, and Statista. The city leads in natural science related tech, logistics, and fintech. Hamburg offers a good quality of life and cultural diversity, making it attractive to both domestic and international tech professionals.

And Frankfurt, Frankfurt is Germany's financial and data infrastructure hub, handling about 25% of Europe's internet traffic, SAP, Software AG, Equinex, MongoDB, which is headquartered in the US, but they have a major office and talent base in Frankfurt and Bolt. The city is known for fintech security, cloud computing and they have a very robust startup ecosystem as well. Frankfurt combines high earning potential with a great city experience and it also happens to be a very convenient travel hub as you can fly pretty much anywhere from Frankfurt.

Now onto some not so obvious trends Germany is experiencing as a result of tech layoffs and offshoring and that dare I say I predict will emerge even more strongly in the coming years. Germany is experiencing freelance boom beyond traditional entrepreneurship. There is a marked increase in tech workers opting for freelancing and independent contracting. Germany now has over 4 million freelancers with a significant concentration in IT media and consulting. This shift is fueled by the flexibility and the rise of remote work and the platforms that connect freelancers with clients.

Higher rates and autonomy. Many freelancers command higher rates than salaried employees. But even then, the contractor employee is often cheaper for the company than a salaried employee, and contractors enjoy greater autonomy and project selection.

As a result of the tech layoffs, the overall economic stagnation in Europe, and the rise of freelancing, another trend is emerging, a rise in entrepreneurship, especially among the youth. We're already seeing early signs, and in my view, it's only going to accelerate. This surge is closely tied to the aftermath of layoffs, people seeking non-traditional employment, and the shift towards remote work.

Shift away from traditional hubs. As companies relocate or downsize in Berlin and other major tech cities, tech talent is dispersing to smaller towns in Germany and abroad. Some companies now require relocation to less traditional tech centers within Germany such as Mannheim or Nerburgg or encourage employees to move to other countries such as Poland, Spain or Portugal.

Sectoral spread with tech rules moving offshore remaining German offices are increasingly focused on business sales and German speaking functions while technical and product rules are consolidated elsewhere.

the vibe. Germany is the country I travel to the most whenever I go to Europe as I have personal ties to it. There are things I love about it. There are things I am not so jived about, just like with any other place. So, please take this with a grain of salt. I will do my best to focus on the vibe of the tech scene. But, please keep in mind that this is a mix of tech impressions and personal perception of the country.

So, in my books, the German tech scene is very similar to the cars it's producing. Germany's tech is like a BMV. Learn it. It's not crazy glamorous, but it's very sturdy. It's very durable and very reliable. It is not insanely experimental. It is not claiming to be developing the time machine and it doesn't promise the future by 2030 but instead it fully embraces the innovation coming from the US or China and it sets its own standards in industrial and applied tech and they deliver what they do best quality durability and predictability.

As for the downsides, Germany is struggling to stay competitive in manufacturing against China. And I explained earlier why manufacturing is so important, even in the context of tech. It's getting harder and harder for Germany to stay afloat and competitive. I grew up with the stereotype that if you own anything Germanmade, this thing is going to be top-notch. This thing will last forever. But at this point, when making certain buying decisions, I do want to admit that Chinese alternatives often blow my mind. And objectively, I can see why Germany is going through economics technation in the manufacturing sector.

Nevertheless, as of 2025, the way I see German tech vibe is that it is still a very solid place for tech in Europe if you are in a high demand specialty. But for tech industry, it is not the same country that it was 10 years ago. But again, this applies to the entire G7 cost of living.

So, the more videos I'm making in the series, the more comments I get from people with often very solid arguments and constructive push back. And to all of the people who provide respectful feedback in the comments, I truly thank you. I do appreciate the ability to be respectful and civil even when you disagree. And that also helps me get better in my research. So I've decided to use slightly different metrics this time to paint the picture of the Germany's economic situation for tech workers that is postcoid and post pandemic.

Now I got to mention one thing before I talk about the numbers. As I was doing the research for this I went through multiple reports published by Euroat painting a very sad picture and the federal statistics office saying that the Euroat is exaggerating and the numbers are especially different when it comes to poverty levels. Now, I'm not an economist by any means, and I'm not taking on a mission to interpret Germany's full economic situation. So, I'm going to focus on the summary that I compiled based on single person expenses for a senior level tech worker such as a data scientist or a product manager.

Now, why these two roles? Because they represent two of the biggest audience groups on my channel, and they also capture software engineering salaries because they're very close to these data points as well.

Cost of living in TechHubs, Berlin. A senior data scientist pulls in around 84 to €110,000 euros with median salary being just short of €100,000. Senior PM's similar situation between 91 and 125 with median at 102. Now you're going to see the tax rate here and I want to clarify a few things about the tax rate that I put at this table. There is a difference between the effective tax rate and the total tax. The effective tax is what is used in international comparisons focusing on income tax. It does not include social security contributions. So the total tax would be higher if social security is included. I did not include social security numbers because they can vary greatly depending on the employment type, income level, and personal circumstances.

Munich salaries are about the same, but the cost of living is much higher. Munich is known to be one of the most expensive places in Germany. Hamburg, lower salaries and lower cost of living. Also, based on the data I was able to find, PMs tend to make less in Hamburg for some reason. So, folks in Hamburg or in Germany in general would love to hear your take, especially if you know why that is. And lastly, Frankfurt salaries very similar to Hamburg, but cost of living slightly higher.

Conclusion, when is Germany a good idea? Germany is great if you live in Germany already and you want to stay within the European Union. It still has one of the strongest tech infrastructures on the continent and it is great if you are in emerging tech, fintech or IoT. You're a specialist in a high demand, robotics, computer vision, cloud, machine learning, cyber security and you don't mind stability over hype. It is great if you want access to worldclass universities and lowcost education for you and your family. And it is great if you prefer working in a country where English is commonly spoken in the tech scene. But the culture still prioritizes local integration.

When is Germany not a good idea? If you're hoping for rapid salary growth, median pay in Germany is stagnating and the total tax plus the social security contributions cut deep into your take-home budget. If you're looking for high growth startup energy like American style energy because much of that is relocating to cheaper, more agile markets like Spain, Portugal, and Eastern Europe. And if you're in a role that is increasingly outsourced, front-end development or QA, cost pressures and remote work are accelerating this trend. And lastly, if you're coming from the US or Canada, expecting a drastic quality of life upgrade. Keep in mind that the trade-offs in flexibility, bureaucracy, and cost after tax will make it pretty much similar to the countries that you're coming from.

And that's a wrap for Germany. Next up is the United Kingdom. As always, I hope this was helpful. Till next time. Bye.