IWH study: Regional effects of recession in Germany due to Russian gas supply cut

This study comes to the conclusion that approx. 2.7 million (or 6.1%) jobs in Germany would be "affected" by the Russian gas supply cut starting in mid-April 2022, whereas Southern regions will be more affected than the Northern ones. This result has been repeatedly used as the "proof" that embargo will lead to "millions of lost jobs" and mass unemployment. However, this interpretation is wrong for the following reasons:

1. Not all "affected" jobs will be actually lost. Since gas supply shortage (if any) would be limited to just several weeks or months, both government and companies would take measures to preserve the workforce (furlough, reduced working hours etc.).

2. Many affected jobs do not exist (yet). The study uses "baseline scenario" as the reference, which assumes GDP growth of 2.7% in 2022 and 3.1% in 2023. In other words, most "affected" jobs would be "new" jobs not being created due to lack of growth, and not the existing jobs being lost due to recession.

3. The estimates are based on (now) obsolete data. The study assumes that the gas flow from Russia would stop in mid-April. In this case, it estimates that German gas storage will be approx. 25% full in June. In fact, storage level is at 50% as of June, 4th. The difference amounts to 60 TWh, or 6 bcm, which is almost exactly the missing gas volume according to the DIW study. Hence, if we ban Russian gas NOW, there will be likely no shortage at all, given that we implement all suggested saving and diversification measures.