Facts & Figures
Jena is the hub of the photonics industry in Thuringia. With 109 companies and a large number of university and extra-university research institutions, more than half the total number of actors in the industry is domiciled here. Totally 8,150 employed in the industry in Jena generated sales worth about EUR 1.7 billion in 2016. Other important locations include the rural district Schmalkalden-Meiningen, Erfurt and the Ilmkreis district as well as the Saale-Orla district.
Most firms are still small or of medium size. Only 13 of 187 companies have a workforce of over 250 and, among themselves, account for almost one half of the sales of the industry in Thuringia. The two biggest companies are ZEISS in Jena and JENOPTIK AG with together about 3,500 employees. Totally 38 % of all jobs are in businesses employing between 50 and 249, 12 % in small companies with between 10-49 employees.
BUSINESS SITUATION & SALES DEVELOPMENT
The question about the present situation of their business is answered with 'very good' or 'good' by almost three of four companies interviewed. This continues the positive trend of prior years. Only 4 % of the companies have problems with winning orders; not a single company believes it is in serious trouble. Over 60 % of the companies managed to increase their sales since 2015, recording an annual increase of 4.5 % on average. Total annual sales in the industry in Thuringia increased further to EUR 3.1 billion accounting for about 11 % of all industry sales in Germany. With a view to the encouraging sales situation, companies expect further increases this year, some of them say they should be substantial. Short of one third of all companies expect a strong rise in sales, another 40 % are hopeful they can increase their sales at least marginally. The other actors expect sales to equal those of prior years; only few companies believe their sales will be somewhat retrograde. The overall mood in the industry has improved again over 2015 and underlines that the industry is healthy and strong.
MARKETS & EXPORTS
Foreign sales in 2016 accounted for 66% of total sales, on average, and as such stabilized on a stable high level. Compared with other manufacturing industries in Thuringia whose average export rates are 33 %, the photonics sector is a very strong exporter. At present, the most important export markets are West Europe, North America, China and Japan. Asked for the export markets with the brightest prospects for the future, companies - like in prior years - give North America, China and South-East Asia. New prospects there include the life sciences, production technology and the automotive sector. The regional market continues to be important. Almost all companies rely on regional suppliers or local complementary technological competence. They take advantage of the excellent cluster structures, short distances and personal contacts on site.
PRODUCT & TECHNOLOGY FOCUS
The extraordinarily broad technological base is a unique feature of the photonics industry in Thuringia. From the traditional sectors such as the optical and mechanical industries, to measuring equipment and sensors or laser technology, the Thuringian photonics companies are active in virtually all fields involving light technologies. Totally eight technological foci can be identified but many companies are active in several of them. The companies were assigned by their main activities.
CUSTOMER STRUCTURE & APPLICATIONS
Photonics companies supply their products and technologies primarily to customers in other highly specialized industries. Traditional consumer business is absent almost completely. Nearly 70 % of all products find applications in production environments, e.g., production monitoring and control by optical sensors and methods of image processing or in high-end ultrashort pulse lasers for material processing. Major markets absorbing the products of the photonics industry are also life sciences & health, information technology and safety and security. Photonic technologies are also indispensible 'problem solvers' in energy and the environment as well as in mobility.
RESEARCH & DEVELOPMENT
In 2016, the photonics companies of Thuringia invested about EUR 37 million in research and development projects. This is a rate of almost 12 % and a significant increase by 2 percentage points or 20% on 2015. Asked for the significance of R&D to their companies, over 70 % opted for the highest category (very high significance). This high research intensity can be found in companies of all sizes and is by no means an exclusive feature of the heavyweights in the industry. Most companies invested in new machinery and plants, measuring, testing and laboratory equipment or had discrete software developed. The high R&D rate also affects the staffing development. Most companies involve a majority of their personnel in innovation processes directly. Besides, new technological developments resulted in more jobs in one of four companies. Investment in new equipment, software and machines also has consequences for the qualification requirements. 59 % of the companies interviewed said that the requirements on their employees had increased. IT competence and complex process know-how are the fields most often given.
For the second time running, companies were asked to comment on the significance of the progressing digitization. This topic become more important to the actors in the industry today than it was in 2015 and over one of two (53%) says digitization has become part of the strategic planning of heir company. At first, the digital change created immense opportunities and challenges for new products and technologies. 55 % of companies say that their products are already important components contributing to digitization and networking. As suppliers to high-tech industries businesses in the photonics sector are predestined to advance digitization to develop intelligent solutions for production processes, in medicine and the life sciences or automotive engineering.
Managing directors confidently face these challenges, monitor the markets and respond with flexibility to customer requirements. Secondly, a higher level of networking will have to be obtained in the manufacturing and sales processes of the companies with the aim of increasing productivity and efficiency. Whether the vision of fully automated production in an industry with intense development activities and niche oriented products like photonics is realistic, seems doubtful. There can be no doubt, however, that the digitization of production, operational processes and communication channels will be higher than it is today. In summary, it can be stated that the companies in the Thuringian photonics industry believe they are prepared for the digital change and believe that their product portfolios and technologies are mainly an advantage to them. Even if the degree of automation in production is still rather low, companies have plans to improve their internal processes. Dramatic changes, large-scale market upheavals or the scrapping of jobs are not expected them.
The positive business prospects resulted in a large number of new hires during the last two years. More than half of all companies created new jobs, another 32 % kept their headcount constant. At present, totally 15,800 people have jobs in the photonics industry in Thuringia, of these 14,500 in manufacturing enterprises and 1,300 in university and extra-university research institutions. Compared with 2014, this represents a rise of almost 4 %. These employees are highly qualified for their jobs. At the time of the interview, 40 % were university graduates, every second employee was a specialist worker.
NEED FOR MORE PERSONNEL
Most companies (68%) expect the number of jobs to go up until the end of 2019. 13 % say they will recruit a distinctly higher number of people, 53 % have plans for moderate increases in headcounts. One third believes that staffing levels will not change. Thedata obtained reveal that about 350 additional specialists per year will be needed until the end of 2019. If those vacating their jobs for age reasons are included, totally about 1,500 employees are needed by the end of 2019.