Germany is a major industrial nation and one of the world’s largest economies. It weathered the economic and financial crisis of 2008 better than most other countries.
The spotlight here must fall squarely on German industry, which has withstood the global downturn and continued to export successful products and services throughout the world. UK business magazine The Economist has spoken admiringly of “Germany’s new Wirtschaftswunder”. Its analysis of the enduring strength of the German economy focuses not merely on the major corporations but also on Germany’s so-called Mittelstand – the legion of highly specialized small and medium-sized enterprises, many of which are based in the German provinces.
The Mittelstand forms the very heart of the German economy and currently offers a variety of interesting job opportunities for applicants from abroad. Of all the companies in Germany, by far the majority (99.6 percent) have annual revenues of less than €50 million and a maximum of 500 employees. According to the German definition, this places them in the category of small and medium-sized enterprises. About 95 percent of these are family-owned operations, managed by partners with a personal liability for the company’s commercial fate.
Writing about Germany’s successful economy, Time magazine recently remarked that many German companies have specialized in the “unsexy side of the industrial spectrum: not smart phones or iPads but machinery and other heavy equipment”.
Some German companies, not least carmakers and the world’s third-largest software supplier, might well disagree and insist that their products are very much on the “sexy side” of industry. Yet the analysis is essentially correct: it is highly specialized industrial companies producing highly specialized goods that constitute the engine of growth in the German economy. Following the much-lauded era of virtual wealth creation on the financial markets, it is as well to recall the following principle: industry has always been a major plank of our prosperity. It accounts for as much as 22 percent of the German economy as a whole, a share that compares favourably worldwide. In France, Italy, the UK, and the USA, for example, industry plays a much less important role in the economy.
Almost 92 percent of Germany’s visible exports are industrial goods. German companies are the biggest exporters in many sectors and in many markets worldwide. This applies, for example, to so-called green technologies – i.e., products in the fields of environmental and climate protection. In the burgeoning sector of renewable energy, which includes photovoltaics, wind power, and highly efficient power plant technology, the German economy has a global market share of 30 percent. Moreover, there would appear to be many more innovations in the pipeline here, since almost one-quarter of the patent applications filed with the European Patent Office in the field of environmental technology originate in Germany.
This all goes to explain why Germany has an export ratio of 41,5 percent, ahead of France, the UK, Japan, and the USA. Europe’s largest economy scores highest with its excellent infrastructure, its highly developed corporate and services sector, its system of higher education, its first-rate vocational training, especially in the skilled crafts and trades, and, last but not least, its capacity to deliver technological innovations.
Digitisation is one field where the drive for innovation is really set to take off in Germany – the German government’s 2014-2017 Digital Agenda provides the political framework for making this possible. The digital revolution is changing industrial and work processes and is having an impact in many different core sectors of the German economy.
With over 30,000 patent applications, accounting for more than 11 percent of the applications filed at the European Patent Office, Germany is at the forefront of European innovation.
Germany’s innovative strength is also down to the immense creativity of its researchers and engineers, and to their boldness when it comes to putting new ideas into practice. In short, demand is high, both now and in the future, for clever and skilful people – whether from Germany or elsewhere.
Many of today’s innovations have been produced by specialist teams at companies or in networks with other companies or with research institutes and universities. Here, again, Germany benefits from its special blend of large and small companies, all of which pursue their own research and development activities.
In fact, truly innovative products are often the work of so-called hidden champions. These companies are, in the main, largely anonymous members of Germany’s Mittelstand, yet belong to the top three in their sector worldwide.
As many as 1,500 of these hidden champions help power Germany’s economy. Since many are tucked away in the provinces, their contribution is sometimes overlooked. Quite a number of them employ a workforce of several thousand people. As employers, they are prized, since they tend to take a long-term view and generally provide secure and well-paid jobs.
Using blotting paper from her son’s exercise book, the Dresden mother and housewife developed the first coffee filter bag in 1908.
In the 1990s the bionic engineer developed revolutionary surfaces with self-cleaning properties. His innovation exploited a phenomenon known as the lotus effect, whereby water droplets forming on the leaves of the lotus plant collect dirt particles as they roll off.
The civil engineer and inventor developed the first fully automatic, program-controlled, and freely programmable computer, the so-called Z3, in 1941.
The physicist detected radiation in the X-ray wavelength (also known as Röntgen rays), a discovery for which he was awarded the first ever Nobel Prize in Physics, in 1901.
The physicist and inventor developed the first functioning device for the “transmission of sounds via electric cable”, an invention which he designated the “Telephon” in 1861.
was awarded the Nobel Prize in Physiology or Medicine in 1995 for her research into the genetic control of embryonic development.
The actress designed and made dolls modelled on her own daughters. The dolls are renowned for their lifelike character and, from 1910 onwards, went on to achieve worldwide fame.
The engineer established the principles of modern aircraft construction and is widely regarded as the “father of civil aviation”.
Using the so-called Hertz oscillator, the physicist proved the existence of electromagnetic waves in 1886. Among other things, the SI unit of frequency – hertz (Hz) – is named after him.
In the 1980s the virologist discovered the viruses that trigger cervical cancer. This enabled the development of a vaccine against the second most common form of cancer among women.
The physicist discovered the GMR effect in 1988, which led to a breakthrough in hard-disk technology. By means of the application of a magnetic field to alternating layers of magnetic and nonmagnetic material, the electrical resistance can be varied in a controlled manner.
The physicist developed the theory of relativity and was awarded the 1921 Nobel Prize in Physics for his explanation of the photoelectric effect.
The engineer designed the diesel engine in 1892.
The engineer and designer developed the first high-speed petrol engine and the first four-wheel vehicle powered by an internal-combustion engine.
The engineer designed the Benz Patent-Motorwagen Nummer 1, the world’s first modern automobile, in 1885.
Artificial light source using an electric current to heat an electrical conductor to such a degree that it becomes incandescent and therefore emits light.
The wall plug serves to anchor a screw or other object in a wall. As a rule, it is made of polyamide and inserted into a hole drilled in the wall. The screw is then placed inside the wall plug and tightened. This causes the plug to expand inside the hole, thus providing a firm anchorage for the screw.
A mechanical process used to print text on paper by means of a printing press containing ink-coated type for each individual letter and punctuation mark.
An extremely common medicinal drug used to relieve pain, reduce inflammation, and hinder blood-clot formation. Its active agent is acetylsalicylic acid.
Plastic cushion that inflates within 20 to 50 milliseconds in the event of an accident, thus protecting vehicle occupants from impact with the vehicle interior. Walter Linderer filed the first airbag patent in 1951, but it was Daimler-Benz that first properly implemented the idea.
An insulated vessel comprising an inner and outer wall separated by a vacuum, which minimizes heat transfer between the contents and the ambient atmosphere. As a rule, it is used to keep coffee or tea hot, but it can also serve to prevent cold drinks becoming warm.
Arranges the chemical elements according to increasing atomic number and their chemical properties, assigning them to periods, and classifying them as main group elements or transition elements.
Hand-sized wind instrument with a metal housing. Air from the mouth is blown through parallel reed chambers.
The procedure to compress digital audio files was developed at the Fraunhofer Institute for Integrated Circuits in the southern German city of Erlangen.
A thermoplastic biomaterial consisting primarily of lignin and cellulose, two of the components of wood. It is traded under the name of Arboform.
Aircraft equipped with engine-driven rotor blades that enable it to take off and land vertically.
A device that optically scans data (e.g., a printed document) by means of sensors and converts them into digital form.
Applied to a toothbrush for enhanced dental hygiene. Toothpaste includes not only abrasive particles but also active ingredients to prevent oral diseases such as dental caries and periodontitis.
Motorized bicycle with one or two seats.
Electric generator to convert mechanical into electrical energy.
An aircraft that exclusively uses air currents for the purposes of flight and therefore does not require a fuel engine. A glider is a very lightweight type of sailplane.
Information and data on the German economy (German, English, French)
Brochure on innovation made in Germany (German, English)