Dr. Robert Lehmann

After a time lag of several years, the technical advances achieved through digitalization in the early 2000s have led to an increase in productivity in German industry. This is according to calculations by the ifo Institute. “Companies need time to adjust their production processes. New technology establishes itself gradually, not overnight. This means that although it’s theoretically possible to increase productivity right away, in practice it happens after some time,” says ifo researcher Robert Lehmann. “So even though digital technologies began to become more widespread at the start of the 2000s, productivity in the economic sectors we examined increased only toward the end of that decade.”

Schleswig-Holstein, Rhineland-Palatinate, Hamburg, and Bremen are the German federal states with the highest economic growth in the third quarter of 2022: Schleswig-Holstein at 2.4 percent, Rhineland-Palatinate 1.8 percent, Hamburg 1.6 percent, and Bremen 1.3 percent. Berlin follows at 1.2 percent. These are new estimates by the ifo Institute. “This is the first time we have calculated quarterly figures for the Länder, shortly after doing so for Germany as a whole,” says ifo economic researcher Robert Lehmann. “Until now, we had produced figures only for full calendar years, and with some delay.”

Bavaria’s industrial electricity consumption is the best metric for predicting the state’s industrial production in a given month. This is the finding of a research project carried out by the ifo Institute on behalf of the Bavarian Ministry of Economic Affairs. “Here we’ve found really reliable data that lets us predict a key economic pacesetter at the state level much earlier than before,” says ifo researcher Robert Lehmann. “During the coronavirus crisis, this kind of real-time data was sorely lacking.”

Export-dependent German federal states with a strong industrial base are being hit particularly hard by the current downturn, according to figures from the ifo Institute. While the service metropolises of Berlin and Hamburg were able to expand their economic output by 1.9 and 1.6 percent respectively in the first half of 2019, the economy shrank by 0.9 percent in Rhineland-Palatinate and by 0.4 percent both in Bremen and in Saarland. Baden-Württemberg stagnated at 0.0 percent.

An expectation of shrinking output has taken hold in German industry. This is the result of the ifo Institute’s latest Business Survey, which found that expectations decreased from minus 2.1 balance points in June to minus 5.7 balance points in July.

L’industrie allemande s’attend à enregistrer une baisse de production, comme le révèle la récente enquête conjoncturelle de l’Institut ifo. L’indice des perspectives en matière de production a ainsi baissé de juin à juillet, passant de -2,1 à -5,7 points, soit le niveau le plus faible depuis novembre 2012. Si les perspectives dans l’industrie n’avaient pas évolué, l’indice en termes nets serait égal à 0.

Germany’s economy will grow much more slowly over the next 15 years than in the past. The reason for this is the worsening shortage of labor resulting from demographic change. These are the results of a recent study conducted by the ifo Institute for the Bertelsmann Stiftung.