Swiss Economy – KOF Employment Indicator remains virtually unchanged despite war in Iran

The now-included responses from February and March have pushed the figure down slightly. This could be linked, among other things, to the outbreak of the war in Iran at the end of February. However, the indicator remains slightly above its long-term average of 1.7 points and has recovered from its brief dip into negative territory in the third quarter of 2025. As the KOF Employment Indicator leads actual employment trends, the current figure points to a moderate performance by the Swiss labour market in the current and coming quarters despite increased geopolitical uncertainty and higher energy prices.

The KOF Employment Indicator is calculated from the KOF Institute's quarterly Business Tendency Surveys and comprises two components: current employment levels and the employment outlook. 

The findings for the second quarter of 2026 are based on responses from around 4,200 firms surveyed in April. Assessments of current employment levels have remained virtually unchanged since the last quarter. The net balance of employment prospects for the next three months remains unchanged at 2.9 points compared with the last quarter. The proportion of firms planning to increase their workforces over the coming months thus remains higher than the percentage of firms expecting job cuts.

Improvements in the wholesale trade and manufacturing

Despite rising energy prices and global supply chain disruption, the employment outlook in the wholesale sector has brightened noticeably (from -12.1 to -3.7 points). In manufacturing, too, the recovery is continuing despite the war in Iran, with the industry-specific indicator having risen from -8.6 to -5.5 points compared with the last quarter. However, both sectors remain in negative territory. In hospitality, retail and other services, by contrast, the employment outlook has deteriorated slightly. The employment indicator for the construction sector remains high at 10.7 points.