Business Climate for Self-Employed in Germany Turns Even More Negative

The business climate for Germany’s self-employed clouded over considerably in August. The “Jimdo-ifo Business Climate Index for the Self-Employed” fell to -18.4* points, down from -13.4 points* in July, thus dropping to its lowest level since the start of the year. Assessments of the current situation were noticeably worse, and business expectations also grew more pessimistic. “The self-employed cannot escape the downward pull of the economy as a whole,” says ifo expert Katrin Demmelhuber. “There are currently hardly any signs of optimism.”

The decline was even greater than in the economy as a whole. “The lack of orders remains a key problem,” says Demmelhuber. “Due to the economic uncertainty, large companies and consumers alike are cautious about placing orders.” In many places, the self-employed in the service sector or retail reported declining sales. There was at least one ray of hope in tourism, where the situation improved again.

The ifo Institute has been publishing the Jimdo-ifo Business Climate Index for solo self-employed persons and microenterprises (with fewer than nine employees) since August 2021. As in the composite index, all sectors of the economy are taken into account. However, its main focus is the service sector.

*Balances, not seasonally adjusted