Restaurant Shutdowns Accelerate as Germany's Hospitality Sector Pushes for Weekly Hour Model

More than 600 restaurants in Thuringia have disappeared from the commercial register between 2019 and 2025 — roughly 12% of the state's total stock, according to industry data. The closures underscore a structural crisis in Germany's hospitality sector that business groups say demands an urgent overhaul of labour laws.

A DIHK business climate survey from early summer 2026 paints a grim picture nationwide: nearly two-thirds of hospitality companies describe their financial situation as problematic, and one in ten report an imminent threat of insolvency. Sky-high energy and personnel costs are the primary drivers. Broader service-sector sentiment is equally subdued, with only 27% of firms assessing their position as good and 31% expecting further deterioration.

Succession difficulties compound the problem. Roughly 31% of hospitality businesses will need to hand over ownership within the next ten years, but many lack viable successors.

Industry Lobbies Target Daily Working-Time Limit

Ahead of a three-hour reform summit at the Federal Chancellery on Tuesday, the German Hotel and Restaurant Association (Dehoga) renewed its demand for a weekly rather than daily maximum working time. Managing Director Jana Schimke called for a clear political signal before parliament's summer recess. She warned that the DGB's proposed mandatory occupational pension scheme would pile additional bureaucracy and costs on already-strained businesses, and accused unions of waging a "class struggle."

The German Chamber of Commerce and Industry (DIHK) backed the push. Dirk Binding, head of the DIHK's labour division, urged a swift switch from daily to weekly hour limits. The Family Entrepreneurs Association went further: President Marie-Christine Ostermann wrote to the ruling coalition factions urging them to forgo the summer break entirely and push through tax, pension and labour-market reforms.

Unions Prepare for Street Protests

Opposition to any dilution of the eight-hour day is hardening. DGB Chairwoman Yasmin Fahimi branded the planned weekly-hour model an ideologically driven "misguided move." She warned that replacing the daily cap could produce shifts of up to 13 hours, eroding worker protections. Instead of legislative changes, the DGB demands stronger collective bargaining agreements, empowered works councils and massive investment in energy infrastructure.

The labour federation has called for a large-scale demonstration at the end of June. It has threatened mass protests if the government moves to cut pension entitlements or abolish the eight-hour day. Government sources suspect the unions of trying to sabotage the talks through obstruction.

Summit Seen as Starting Gun, Not Finish Line

Chancellor Olaf Merz tried to lower expectations before the evening meeting, describing it primarily as a listening and exchange exercise rather than a decision-making forum. CDU General Secretary Carsten Linnemann and SPD General Secretary Matthias Klüssendorf both stressed the informal character of the gathering.

The SPD is pressing for a growth package to be passed before the summer break, but any formal decision is not expected until the coalition committee meeting scheduled for June 30, 2026. Meanwhile, Gesamtmetall President Stefan Dinglreiter added his voice to the call for lower labour costs, warning that Germany's international industrial competitiveness is at stake.

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