Germany hit by a series of major job cut announcements

( AFP )- Several German industrial heavyweights have unveiled shock combinations of strong earnings and sharp job cuts, feeding widening discontent amid a landmark tax fraud scandal.

One after another, automobile parts group Continental announced 3,800 job cuts, followed by Siemens with 6,800, Henkel with 3,000 and BMW with 8,100, all within the space of a week.

The figures were read across the nation and given added resonance by the fact that company results in general have been strong, allowing groups like Bayer on Thursday, following Daimler a day earlier, to justify increasing their bosses pay by 27 and 68 percent, respectively.

"It is not possible for a company to make (profit) margins of 20 percent and large-scale personnel reductions at the same time," Social Democrat spokesman for economic affairs Rainer Wend told public television ZDF.

Net profit at BMW jumped by almost 80 percent at BMW last year, while at Henkel, the maker of Persil detergent, it gained eight percent.

Results at Siemens were multiplied more than eight times, though that was in large part owing to one-off gains from the sale of a subsidiary.

After the Finnish mobile telephone maker Nokia raised howls of protest by announcing in January it would close its plant in the city of Bochum, the cuts have pushed trade unions and some politicians beyond the breaking point.

"Wanting to simply reduce the workforce is not a sustainable concept for the future," said Werner Neugebauer, head of the IG Metall trade union chapter in Bavaria regarding BMW management.

The latest wave of cuts will also affect the job market. A continued fall in unemployment announced on Thursday could be slowed as a result, said Klaus Zimmermann, head of the research institute DIW.

But strong demand for workers and the number, close to one million, of vacant posts, according to the national employment agency, offers hope to those who will lose their jobs, as long as they can satisfy the company's needs.

"It's the global trend. There are always job eliminations, but also hirings, and we hope the hirings will continue to dominate," Zimmermann said.

As businesses complained about a lack of skilled labour, in particular a serious lack of engineers, it was time to "to think in the long term about giving workers more skills" rather than eliminating them, the deputy head of the conservative CDU parliamentary group, Michael Meister, told the Berliner Zeitung.

The debate over cold-hearted capitalism is not new. Shareholders have been given priority over staff for several years by virtue of a "shareholder value" concept now in force in a majority of companies.

The increase in dividends accorded by companies listed on the DAX index of blue-chip shares is an illustration of the new policies.

But it takes on another dimension as the country is rocked by an unprecedented tax fraud scandal.

Klaus Zumwinkel, former head of logistics group Deutsche Post and a prominant business leader, was the first to be targeted, and quickly resigned his post.

German justice officials suspect Zumwinkel of having failed to pay around a million euros in taxes.

His fall further tarnished the reputation of the industrial elite.

Following the discovery of a kick-back system at the industrial group Siemens and a corruption affair at the auto giant Volkswagen, several business leaders have been forced to resign in the past couple of years.

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