The Swiss watch industry is in danger of growing unemployment

About 700 employees in the Swiss watch industry registered their names in the office of the unemployed between the beginning of February and the end of July, but the number of jobs removed is expected to exceed the barrier of 4000 by the end of the year, while the watch sector does not expect the situation to return. Return to normal before "at least 2023."

In another tragic story written by the "Covid-19" crisis in the country of the "timekeeper" industry, Corum, Virtanor, Gilbert Petit-Jean, Griobel Forsy, Gilo Günther, among other examples of many luxury Swiss watchmakers, laid off the highest number of staff since the start of the "Covid-19" crisis in mid-March.

Yesterday, two other brands: Ulysse Nardin and Gerard-Perego of the Kering luxury watchmaking group announced yesterday that they will separate themselves, from now until the end of this month, from 100 employees, or the equivalent of more than a quarter of their workforce. 390 employees) in La Chaux-de-Fonds, the capital of the Swiss watch industry.

And if the watch industry workers' association reported these layoffs in a statement, many other cases are not subject to radar detection. "We are aware of this collective separation that is being announced, but that which is conducted in a more differentiated way between workers is beyond our control," said Francois Mattel, secretary general of the association, in his statement. However, the two companies said they employ about 30 percent of cross-countrymen. The borders - most of them French - and these will be affected by the same rate of demobilization.

The association estimates that between 600 and 1,000 jobs have been cut in the watch industry since the start of the pandemic, a decrease of 1 to 1.7 percent compared to the last annual census of the number of workers in the watch sector. The association registered 59,103 watchmaking employees at the end of September 2019, close to the 2014 record of 59,112 full-time employees.

Figures released by the Ministry of Economy indicate that as of last July, 2,149 unemployed people were registered in the watch sector, an increase of 47.8% compared to February. The association says that the numbers seem realistic, and mainly reflects the disappearance of temporary jobs, "but there is a share of natural departures from the sector, such as retirement, for example, that was not compensated for by new appointments, and this is another hidden aspect of the number of unemployed."

The Association expects this trend to continue in the coming months, with the demobilization in September being moderately calm. But from October onward, job cuts are expected to grow further. In the medium term, the Association does not see the possibility of a complete return of the sector to its normal position in the markets before "at least 2023."

The association says, "It is difficult to estimate the number of layoffs to come. But if it is measured against the global financial crisis of 2008-2009, the watch sector lost 4,000 jobs, half of them due to layoffs before jobs were re-established in 2011 with the recovery." The association, which takes the same period as the basis for the analysis, points to a "worse vision" with Covid-19, or the loss of 5,000 jobs during 2020.

The other side of the crisis concerns hundreds of small and medium-sized companies, with the watch sector being the most closely associated with them. The introduction of secondary business to small companies has become greatly weak, with some of them having abandoned or even closed the shop. Some economists argue that the loss of these crucial watchmaking skills is a "frightening prospect". The other affected, retailers, some watchmakers have pursued a strategy of "selling to the end customer" rather than selling to retailers.

On the gloomy news of the watch sector, some economists comment: The sector took a step back, and employment undoubtedly took a shock. But the shock has its limits. After the 2008 crisis, in which the Swiss economy lost 100,000 jobs, the economy created 400,000 additional jobs. In many other countries, the labor market is still struggling to recover.