Only One in Eight Companies in Germany Expect Better Business in 2025

Only 12.6% of companies in Germany expect business to be better next year, according to an ifo Institute survey. By contrast, around a third (31.3%) expect their economic situation to deteriorate in 2025. A majority (56.1%) expect their economic situation to remain unchanged in 2025. “Companies are currently seeing no signs of an economic upturn. In view of the fact that the economy has already performed poorly in 2024, these figures are worrying,” says Klaus Wohlrabe, Head of Surveys at ifo.

“No sector is really optimistic about 2025. A lot of work awaits the new German government,” says Wohlrabe. The construction industry is especially pessimistic about 2025, with every second company expecting a deterioration. Less than 5% believe that things will improve next year. Sentiment in the retail sector is similar. 42.1% of companies fear that their business situation will deteriorate. Only 7.9% are confident that their situation will improve, while half (50%) expect the situation to remain unchanged. The outlook in manufacturing is also subdued.

Among manufacturing companies, 15.7% expect the business situation to improve next year, while 31.8% expect it to deteriorate. The majority (52.6%) expect the trend to remain unchanged. In the service sector, the picture is slightly more optimistic, even though there is also considerable uncertainty there. 11.9% of companies expect an improvement, while 28.2% expect the situation to deteriorate. The majority of service providers (59.9%) do not expect their economic situation to change.