The German Confederation of Skilled Crafts (ZDH) forecasts a roughly 1.5% real sales decline for Germany’s craft sector this year, as rising operating costs push customer prices higher.
ZDH’s annual estimate pairs a 2.5% increase in nominal sales with a fall of about 1.5% after inflation. The gap separates the money businesses take in from the value of sales after price changes are accounted for. The forecast therefore points to higher revenue in nominal terms even as inflation-adjusted sales contract.
Prices are another source of pressure. ZDH’s selling-price indicator rose 10 points to 32 in the third quarter. The group cited higher energy, materials and labor costs and said businesses expected further price increases. Its report also said survey responses pointed to additional sales declines through year-end.
Average order coverage fell to eight weeks from 8.3 weeks in the third quarter of 2025, while capacity use slipped one percentage point to 78%. ZDH’s separate order-stock indicator remained at minus 13. Together, the measures show shorter coverage and lower capacity use alongside an unchanged order-stock reading.
The business-climate indicator dropped five points to 105 as firms viewed current conditions and the months ahead more negatively. ZDH’s investment indicator fell to minus 16, its lowest third-quarter reading since the 2009 financial crisis.
The German government’s autumn forecast calls for inflation-adjusted gross domestic product to grow 1.3% in 2026. ZDH said craft firms, which rely mainly on domestic demand, had seen little added work from the anticipated recovery. The government forecast covers the wider economy, while ZDH’s figures focus on the craft sector.
ZDH Secretary General Holger Schwannecke warned that rising costs were making skilled-trade services harder for customers to afford and necessary investments more difficult to finance. He urged the government to reduce energy and labor costs, taxes and bureaucracy, and provide businesses with greater certainty about policy.
