Facts & Figures
Jena is the hub of the photonics industry in Thuringia. Totally 108 businesses with altogether 9,000 employees are registered in Jena and the surrounding Saale-Holzland District. They generate about 60% of the sales in the industry. Other major sites are the districts of Schmalkalden-Meiningen, Erfurt and the Ilm District, in addition to the Saale-Orla district.
Most firms are small or of medium size. The average number of jobs is about 80. Totally 43% of all employees work in companies with a staff between 11 and 49 people. Only a few have personnel of more than 250. The two biggest employers are ZEISS and JENOPTIK with a combined total workforce of 3,700.
BUSINESS SITUATION & SALES DEVELOPMENT
When asked about their economic situation, the overwhelming majority of businesses say their status is >very good< (32%) or >good< (51%). The order backlog is good despite the slightly weakened economic forecast at the beginning of 2019. The positive development over the last few years allowed them to invest in production capacities and to further strengthen their research and development. More than 65% of all businesses were able to increase their turnover since 2017; only 3% had difficulties in winning new orders. Total sales continued to rise and scored 3.3bn Euro. This accounts for 9% of the sales in the industry in all of Germany. Two in three of those interviewed expect sales to rise further in 2019, 35% say their earnings will remain on the prior-year level; only few expect a decline in sales. Thus, the business climate in the photonics industry has stabilized on a promising level in comparison to 2017. It remains to be seen how the currently abating dynamics in the global economic development will affect the industry.
MARKETS & EXPORTS
Totally 67% of sales were generated abroad in 2018. Compared to an average 36% export in other manufacturing industries in Thuringia (Statistical Office of the State of Thuringia), the photonics industry is an extremely powerful exporter. The markets to which most sales are made remain the U.S., China and Western Europe. All businesses asked see the highest potential in these regions also in future. Those interviewed are watching developments like the imminent exit of Britain from the European Union, commercial disputes or national protectionism with concern. One fourth of all businesses is already affected directly by these issues, another 35% expect negative consequences for the future. More than half of those interviewed expect risks to occur mainly in their business relations with the United States, China or the UK.
PRODUCT & TECHNOLOGY FOCUS
The technology spectrum of Thuringia’s photonics industry is unique, even compared internationally. No other hub can boast a similar density of businesses in optics or mechanics, metrology and sensors, laser technology and opto-electronics covering, without exception, all value-added areas in photonics. Altogether seven main technological fields can be identified. Many businesses are active in more than one field. The category into which a business is placed below depends on their main business segment. As expected, there were hardly any changes in comparison with the interview two years ago. Only photovoltaics lost its significance after the closedown of Solar World in Arnstadt, where only a small number of jobs still exist. The remaining firms are now placed in the opto-electronics segment.
CUSTOMER STRUCTURE & APPLICATIONS
The Thuringian photonics businesses sell products and technologies and provide services mainly to customers in other highly specialized industries. Almost no products are sold to end consumers. The Number One target area is industrial production, followed by health economy and production-related services. Optical components such as object lenses, sensors and cameras are important parts of modern production systems. Lasers enable efficient and high-precision machining and processing of metal, glass and plastics. Optical measuring instruments ensure precision in production. Imaging processes have become important tools in medical diagnostics. Surgical microscopes, special lighting systems and special-purpose lasers for diagnostics and surgery have become an inherent part of modern medical care. Optical measuring and analytical processes, methods of industrial image processing or of light and color measuring technology are preconditions for the development of competitive products and efficient manufacturing processes in today’s environments.
RESEARCH & DEVELOPMENT
Spending on research and development reaches a new all-time high. In 2018, businesses invested 12% of their sales, i.e. nearly 400million euro, in innovation. Thanks to that research effort, businesses say they occupy leading positions (49%) or are even technology leadership (39%) in their respective market segment. During the last two years, many businesses have invested in new plant and machinery, purchased new measuring and laboratory equipment and had own corporate software products developed. Digitization is making ever deeper inroads. A large majority (75%) of businesses has plans for investments in this area in the next two years. The focus is not only on adopting or expanding software-based planning systems (80 %) or linked automation techniques in manufacturing (32 %), increasingly digital technologies are also integrated in product development (70 %). Many of those asked said they expected that digitization would boost sales and strengthen the organization of supply chains in this highly specialized and innovative segment.
The very good business situation during the last two years created many new jobs. About 400 new employees found jobs in industry or research. Almost one in four of those asked stated they had recruited new personnel in substantial numbers during the last two years, another 35% increased their staff levels at least significantly. Staff reduction was not an issue. This means that totally 16,200 specialists are employed in the photonics industry of Thuringia, 1,600 of them at universities or extra-university research institutions. Asked about employment expectations for the current year, the answers were ›distinctly more‹ (10%) or ›more‹ (58%) employees. The high-technology firms in the photonics sector employ highly qualified personnel for the most part. At the time of the interview, 43% had a university degree, every other employee had specialized skills.
NEED FOR MORE PERSONNEL & RECRUITING
At the time of the interview, 68% of all companies reported vacancies. New employees are not only wanted by the big players in the industry, small and medium-size firms are also looking for many new recruits. More than 600 vacant jobs in production, design or development are advertised but finding interested applicants is becoming increasingly difficult, interviewees said. Over 70% of all businesses have problems finding suitable employees for jobs in production and design. A little less than 60% believe that the skilled academic personnel pool is ›rather poor‹ (43%) or ›very poor‹ (15%). As a rule, it takes several months to fill an advertised vacancy.
Short of 40% of those interviewed claim that they would have a few more (31%) or significantly more (7%) employees today were it not for the scarcity of qualified personnel felt for a couple of years. At least two thirds of the businesses replied they were able to fill all vacancies adequately. The negative implications of the lack of personnel are still limited mainly to the execution of purchase orders but no less than 45% of businesses say they had been able to implement fewer new developments only. At the same time, 40% of the firms invest in automation, a little less than one fourth shifts at least part of their production capacities to other regions.