Get access to global coverage at an exclusive 50% discount at economist.com/moneymacro Further reading from the Economist (more pessimistic case and update about the fall of the government): 1. www.economist.com/business/2024/10/31/volkswagens-woes-illustrate-germanys-creeping-deindustrialisation 2. www.economist.com/europe/2024/10/24/angela-who-merkels-legacy-looks-increasingly-terrible 3. www.economist.com/europe/2024/11/07/germanys-fractious-coalition-falls-apart-and-how
I like this guy. His answers are great--- short and to the point. I'm from the US, and the Native- Americans have a saying, (originating from when they were getting screwed over with worthless treaties full of legalese jargon, and rambling, flowery promises). They said, "It does not take many words to tell the truth."
As a Pole, I keep my fingers crossed for good fate of Germany economy. Germany is the biggest trading partner of Poland and (probably) the biggest investor in Poland. Sure, Poland can survive without Germany, but both countries will be better if both economies do well.
Poland has a lot of room to catch up, that is why they have big growth right now. But i agree, both countries need each other. But i feel Polands demographic problem is worse then Germany's. It got "fixed" a little by the Ukraine immigrants, but normally Poland's immigration is to low to fix it.
Poland is one of the reasons Germany's industry is failing. German fabric goes outside of Germany, like Poland and other countries, which misuse the EU for only their profits...
The rundown of economists in 2012 was that during the times of 2022-2028 the economic growth of germany will slow down or come to a halt due to redistribution of energy production. This is broadly the fact as its happening rn. HOWEVER the same economists also said that the cutting off of oil will free up ALOT of capital from 2028-2030 onwards, truely unleashing its economy. Heres to hope
As a german, I can tell you this whole "skilled workers shortage" is completly overblown or completly nonexistent in pretty much all branches of the economy besides the medical branch including hospitals and retirement homes. Companies, especially in the trades, keep complaining about not finding enough young people to train, however they offer shit pay, shit working conditions and don't respect their employees. Not hard to guess why they do not get enough young people.
"Respect " Is really lacking. "Teamleiter/innen" should also understand how to lead people this is very important in workforce. It's a kind of motivation which keeps employees to stay and wanting to come to work. At least if people are depressed every months earning minimum wages which is less, They deserve to be motivated and earn [Respect].
Just a reminder to everyone watching "the economy is doing well" or "the country is doing well" doesn't directly translate to "the majority of people who live in the country are doing well"
Likewise, remember that headlines like "AI will steal ALL jobs tomorrow" and "The economy is in shambles!" are sponsored by big corp to discourage you, the average Joe.
Yet then you have people here blatantly crying out BUT THE US IS DOING SO MUCH BETTER ECONOMICALLY THEN THE REST OF THE WORLD!!!! Well guess what high gdp doesn’t mean shit for the average Joe….
I couldn‘t agree more. Having lived through the sick man of Europe debate early 2000 were everyone qualified Germany as doomed only to have a debate about the ‚insane productivity’ of Germany 10 years later that would tear the eurozone apart. Now another 10 years later things turned upside down again. Yes, Germany has significant problems, but they are all manageable. Most important is imho is reduction of bureaucracy and overhauling the tax system.
It's so bad that the middle class is paying more than the super rich in germany. The tax system definitely has to be revised. And don't get me started on bureaucracy, I've been waiting to plug in a solar panel for the past three months due to concerns over some animal gnawing the cable. It's not even the concern that bothers me, by all means, let's secure against that. What bothers me most is that the person responsible brought up the issue and haltet the entire project but doesn't implement the solution nor allows anyone else to deal with it.
I am from Germany and I wish more Germans would talk about our economy like you did. Unfortunately all this talking about bad German economy is just a tool for right wing parties to win elections and a tool for Putin to destroy democracies. I hope the CDU politicians will act wiser after the elections. CDU and FDP held German economy hostage by making badly needed investments impossible because they wanted to destroy the coalition. I hope they will act more decent and less destructive after the elections. But I fear they will not do it and just act like Trump and Musk.
Lord help us... They say only the Universe and human stupidity are endless...Do you even realize how important was the cheap gas from Russia for the German industry...Americans set you up twice in history by those two world wars,and now they blow your Nordstream gas pipeline ,and on the top of that,with the most stupid story called IT WASNT US... My GOD...What is wrong with you people...
It's the most realistic take yet. Germany's GDP growing by -0.3% one year and ~0% another year does not a collapse make. The reason everyone's seemingly shouting from the rooftops Germany is "collapsing" has nothing to do with economic reality of Germany and everything to do with economic reality of advertising space on the internet especially in the English language where everything has to be sensationalized to high hell and narratives, which started taking over sports discussions like a decade ago, have now taken over all other news as well. So once a narrative that sells well - like "Germany is collapsing" - takes hold it's very difficult to dislodge it because it's more profitable to keep it going.
Extremely optimistic take. This is 100% pure copium. The world wasn’t as cutthroat competitive as it was back in 1990s nor Europeans had stranglehold over their colonies like before 1970s. Europe is extremely resource poor.
@@BrokeBillionareGood point, but the Germans are a very resilient people, they survived two world wars, even the Roman invasions. They may decline but they are one of those people that can rise again, many lately speak of Poland as the great European leader, but Poland has never been as outstanding a country in Europe as others, I bet more on Germany to be honest.
Lies? You like lies? Well no wonder germany is where it is. Fools wanting positive lies than the truth. Wake up. There is no skill shortage. If there was wages would go up.
my friend no. he is saying the same old bullshit lies of "Capitalism finds a way." and "the market solves itself" lol. he even said companies leaving Germany is good news even if thousands are losing their jobs. typical Capitalist psychopath economics. German is NOT doing well, but don't worry, you will never starve or be homeless
@@mcmarkmarkson7115while i agree that politics in general are currently a clownfiesta. Istead of working on solutions for ongoing problems as a unit, the Ampel has only rly managed to throw blame back and forth. Along side afd gaining votes whilest being a threat to our democrazy and not at all being a "alternative" i could ever consider. Its rly hard to even find a party i would wanna vote for come febuary. Overall the living standard is still impressively high though and anybody who is complaining about it is just spoiled tbh. Having lived 9 years in Namibia and visited alot of Africa, its rly alienating for me to see alot of germans complain. Ofc im not saying too turn a blind eye to politics, but the complaining and raging part of the population is neither helpful to find a solution nor is it necessary.
A few notes from a young professional working in industry: Unfortunately the government problem is not so easy to solve. It currently looks like we‘ll get a CDU-SPD coalition. Both parties are pandering to (soon to be) retirees instead of investing in our future. The cost of housing problems are also a hidden wealth transfer from young to old. Although budgets are under pressure, we see plenty of work in the in automotive. Core strategic topics are still being invested in heavily, there’s just a stronger focus on value. There was a lot of excess hiring at least in IT of people with questionable qualifications, that companies are now trying to get rid of. But there’s by no means a complete bust of the labor market. If you have some runway, now would probably be a good time to start a business and profit off of market shifts.
Germany wouldn't have a problem with questionably qualified IT people if they were willing to pay market salaries for decent IT professionals. But the unions and German companies in general seem unable to grasp that good IT professionals shop for jobs globally.
Would note on the argument that the government has low debt and CAN invest in the future: Germany is overtaken by a quasi religious dogma around public debt. People will somehow complain about the infrastructure and somehow completely fail to make the connection that the debt brake is the main reason why investments can't be made (and ultimately why the governing coallition broke up).
The illegal migration is the problem. I costs us billions and billions of Euros. Also, as sorry as I feel for the refugees, we can not take all of them.
The Problem is not money shortage of the public institutions it’s money usage. And it’s almost completely used on social purposes that are in fact money for the lost and left behind to continue voting for left wing parties and stay quiet otherwise.
germany is actually not that low on debt if you account for all the money they promise to spent for pensions and stuff. Germany has 2 big problems in that regard: 1st The government is by far the biggest employer, they want to make the people dependent on themself so they dont revolt and get voted again. 2nd The government spending is terrible allocated. The government has to finally spent money more efficiently and not be wasteful. Out of 477 Billion € 127 Billion (27%) is already spent every year on pensions, It will only go higher from now. 8% every year is wasted because of interest debt. If we would double our debt it would mean that 16% of our entire federal budget would be burned every single year. Since i dont think that they would allocate the debt effective enough, i would be hella pissed if they actually increased debt, i would like to see proof that they can actually run a budget effectively and so far i havent see that. *Basicly what would happen is that we would have to increase our debt every year at higher and higher rates which would ultimately lead to bankrupt the country. Sure it is highly unlikely to happen in 5 years, but it only has to hold on for 20 years till all the politians arent there anymore right? People also tend to forget that being rich isnt guaranteed, history proofed that rich countries can and will go bankrupt if incompetent leaders with only self interest are at the top.
If you don’t have enough money to pay your rent that doesn’t mean you should go into debt to pay it. Maybe you should consider not eating out for every meal you eat. There is more than enough money but the government is overcomplicating and overpaying on most of the stuff they spend it on. Have a look at the great projects „Berliner Flughafen“, „Elbphilharmonie“, „Stuttgart21“, the decision to lay underground high voltage/long distance cables on the countryside. Those are all unnecessary money pits with little value to society and the economy.
I'm a professional immigrant in the automotive industry. Specifically, software division at VW. It's really hard to take it continuous beating from the media/social media due to illegal immigrants and failing politicians. But 1 thing stands fest to me is that i want to see Germany succeed. I'm not a German. But i have been a fan of this country since 10 year old. I was hoping 1 day i could work here. And i took it because i really love Germany. It's so sad seeing horrible politicians take the media for rhetoric for very little action. I got a chance to move to US with of course no criticism of immigrants since it's quite diverse and much higher salaries. But i want to be part of "building" story in here. Succeeding in a challenge is the best feeling i have ever had before and I'll do my best this country to thrive again as a leading figure in my industry. Being part of this is massive. So to my fellow Germans, do your best, this country shall thrive. You have survived much worse conditions with much higher resilience.
I’m glad you found your way to Germany and I really like your views and vision. I hope you succeed and it would also be good if you have some children, at least two 😅
Hi. How would you say that VW is doing, in adapting to the new reality of cars incorporating much more software/AI. People often say that this is a big weakness of Germany - its strength is in engineering rather than software, and it lags behind. Do you think this is true?
The problem with the prognosis of Germany excelling in a fragmented world economy is that the German exporters will still have to compete with the Chinese to dominate third country markets. Right now, for example, Chinese cars are making major inroads in Latin America.
that not even the main problem, the main problem is Germany is not a "3rd power" country. it is trap in the EU and does not have the ability to set an independent trade policies. and France is taking advantage of their influence in EU to basically screw Germany over with trade policies that does not favor Germany.
1 in every 4 new cars that are selling in my country are electric and 90 percent of those are byd . im from costa rica our electric vehicles have green license plates so is easy to spot them and when you check the brand : byd almost every time ... i have never seen any brand taking that ammount of market share in just 2 years . the great loser here were not asian companies like toyota or nissan since people here love toyotas they are quite reliable cars the losers were european brands .. THE SAME APPLIES TO CELLPHONES. huawei came out of nowhere and now every household has someone who uses huawei which by the way they are now call :"honor " is the same brand as huawei but they changed their names so sanctions dont affect them ... i dont like china what represents they lack of freedoms you know the drill , they have damage our ocean ecosystems BUT credit were credit is due BYD is crushing the competition here , not even that local sellers of the brand couldnt imagining how quickly people will buy them . while elon wasting time byd crushing them atleast in latinamerica , i dont remember the last time i saw a tesla but everytime i go out for a walk i spot hundreds of byd.
i forgot i remember a time were germany solar panels were a thing , well not anymore they gon copied by the chinnese counterparts and now those chinnese brands are selling really affordable solar panels ... i just think money and macro is too optimistic about germany , look i would have prefer a world were the chinnese goverment didnt have that much power cause like i said i just dont like them they have made so many bad things in my country for example they sell bad products counterfits in every local chinnese grocery store but again they are absolutely demolishing competetion in high tec stuff, so they sell you the counterfit and they also sell you good quality i think germans were too honorable to deal against the ccp of china..... they are still too naive ... i dont think this trend is gonna stop ..
So there are people currently in Germany, that have or would acquire the skills to work in IT, and are currently choosing not to because of the wages? Because if that answer isn’t yes, just because a company would still be able to fill a position with higher wages doesn’t mean there isn’t an overall shortage.
@@matthias8582 even 50% of US IT salaries would be good. A senior software dev in Munich working for a local company can't afford to support a stay-home wife with 2 kids - it is messed up.
@@stariyczedunThere you answered yourself, do you really expect you to support your wife and two kids on one salary? What kind of fantasy world are you living in? Tell your wife to go out working and put your kids in kindergarten. Your economic situation will improve dramatically trust me.
@@goodmusic4673Bro it wasnt stable, it was decaying and running out the clock on bought time. Ir you honestly believe the country was doing great then, it means you didnt pay attention yet.
THIS. How anybody can follow that snakeoil salesman is beyond me. Yeah he touch upon topics that will become problems like demographics but where he totally fails is he hypothises from a state of vacuum aka the future is set in stone and nothing can deter it. which is totally wrong. Of course a country like e.g China will take counter measures to stabilize their low births or in this example Germany will bounce back. it will hurt but they will likely find a way
As a german i think saying "the economy is collapsing / going down the drain" is a bit over-sensationalized. But i also think we're not doing the greatest. 8:43 "Growing more slowly, sure - but growing nonetheless". I think that describes it very well. We are not doing THAT bad, really, the economy is just growing less than the US. And we always like to compare ourselves. But then people don't think about us having a more socialist state, more safety nets, less work hours and more holidays. The economy might not blow the others out of the water but at least the place has some nice living conditions. And yeah, the collapse of our government is more seen like a good thing here. Not "oh wow, it failed, what are we gonna do?" but rather "well, people disliked the direction we're headed, great thing we get the chance to have a change to better the political situation more quickly now!" I mean i don't wanna act like there are no problems. There are. But there are always problems and i don't perceive the current ones as unnaturally high when looking back at a new war in europe, covid, the "refugee crisis", the financial crisis - there will always be large issues. It's just different groups being affected. If you work at VW then well... i understand you might be troubled and look at this as a very hard time. But in my friend circle, colleagues, etc. i don't really see any people having a particularly hard time.
You do realise that most of those problems were one's that Germany had a significant influence in either causing or exacerbating, right? The new war in Europe - Germany Covid - Setting EU policy The refugee crisis - yeah Merkel did that The financial crisis - Germany set energy and immigration policy for the EU - Now we all suffer for it There were plenty of other factors. Though Germant was a significant contributor to all of these issues, yet they still act like the nobles of European politicians and admit not one mistake while having no plan to do better in the future. There are no apologies. They simply want to ban or smear political parties that would do things differently. Modern Germany is a disgrace, and Europe suffers for it. You talk about growth, and growing "less than the US" That may not seem like a problem today. What about in 20 years? If Germany finds itself considered a small or medium sized economy, having been outpaced by other economies that are then much larger? If you don't see anyone struggling around you, then you live an insulated life, keeping away from people less fortunate than you. Give it time, as Germany's economy shrinks or grows more slowly, you will see that the costs of the state are no longer met, and inflation chips away at the quality of life of the people. The top 10% will likely still do fine. Though an economy should be judged by the quality of life of the bottom 30%, not the top 10%. This is something that Germany forgot in it's vision for Europe. Give it time. I also suggest that you travel. The European viewpoint of Germany has soured significantly. As it has around the world.
@@BusesAreFatCars - How did we contribute to causing the war in Ukraine? - Yes, Merkel did that. And it was the correct decision. Giving a save shelter to refugees in just humane. If other european countries or other countries in the world or other germans are angry about that, then so be it, but i am proud if we can help out those in need. Same thing now with the Ukraine. - The EU is not ruled by Germany. I'm not sure which exact policies you are talking about regarding energy or immigration.
One thing we germans did not so well in recent history was scaling our industries. We were leaders in solar, are quite good in UV-chip manufacturing and really good in making IP for chip, thermo management etc. And while our highly diversified landscape of companies is really good in "exporting companies", and it's no longer feasible to supply the entire world from germany and fullfill climate regulations, it would have been really helpfull to maintain some key technologies in germany. What's really bright in germany right now is medical and space exploration. If you follow the corresponding scientific institutions, there are quite a view gems we will most likely export to the US/China, Turkey and Korea. But this argument really depends on a strong german government, that finds a way to end the war in the ukrain to solve our energy problem, and holds our ground against the USA and China while building good trade relations with both. And it would be really benefitial for all of us if we could somehow get the capital of the world the US, to terms with the factory of the world China.
i just recently discovered your channel. And I can't ignore, when i see well educated people doing great quality work, in this case, great quality content!!! Keep up the wonderful work!
I like this guy. His answers are great--- short and to the point. I'm from the US, and the Native- Americans have a saying, (originating from when they were getting screwed over with worthless treaties full of legalese jargon, and rambling, flowery promises). They said, "It does not take many words to tell the truth."
German here. First of all, thank you for all the encouraging words since I am afraid of the near future of German and Europe. My main concern is that Europe has not a single toe in at least one door when it comes to all those "big future markets" (AI, computing hardware like GPU and CPU, Software and so on). Maybe I am just too negative, but in my opinion the only company might be ASML. All the other big players are either in the US or China. On top of that we got soooo much bureaucracy, which (at this point) costs more than it helps Germany & Europe. Again: Vielen Dank für das Video (thank you very much for your video)!
Well at least we don’t have a mad man like trump. Also I have seen numerous reports that the ai current worth might be a bubble meaning that it’s highly overpriced. If this bubble pops it will reach the entire world. But mainly the us. Also apple’s sales have slowed down in china greatly. I think we also need to realize that if more countries produce stuff (e.g china) that yea our sales will go down. But what I want to emphasize is that we as Europe should finally take Africa seriously and start investing money there. A lot of people there will need Audi’s etc
Toyota group produces over 10 million cars every single year, making it the largest automaker. They do this with roughly 370 thousand employees. Volkswagen group produces less cars, with 670 thousand employees, almost double. Seems kind of strange that there isn't more being done to improve productivity, especially if there's a so called "massive skills shortage".
The comparison is not 1 to 1 accurate. A lot of VW employees are working in dealerships and repair shops and not in manufacturing. Toyota has almost all repair facilities and dealerships outsourced to small local companies working for them.
Maybe because Germany values the stability of it's country and workforce and employment level, rather than just pure productivity. Volkswagen was originally sponsored by Hitler, it became one of Germany's biggest employer. It's a National name and not just some company.
Its always funny when john stevens are digging up bullshit they heard 20 years ago and committed to core memory. RN we have cheaper electricity than the Poles or the British and gas is back down to only slightly more expensive than 3 years ago. "Cheap russian gas" never meant free. It was like 10% cheaper max than norwegian or algerian or whatever.
@@meinnase I am living in Germany (Bavaria), my energy bill for a family of 4, is high like Snoop Dog after a gig night, especially when I factor in the modern household that I live in! (When I say “expensive” I mean expensive compared to the median salaries.) I pay 80 Euros a month with all LED lighs, heat pump system and all AAA rated electronics in the house. Since Germany is the 5th country I am living in, I think I have a good idea of how it compares to other countries: Compared to Hungary, electricity is more expensive here. Compared to Belgium, electricity is slightly more expensive here. Compared to the US, prices are super expensive in Germany. Compared to Romania, prices are more or less the same.
@@The1KovacsAttila1dann 80 Euros seem pretty cheap to me, I remember at the start of Covid I payed 110 for a two person flat, that did get adjusted down to 105 after a year but still
There isn't munch of a skilled workers shortage. More a well paying jobs shortage. Two things Germany really needs is investment into the public infrastructure - there are 4,000 bridges which need immediate repair within the next two years - and a switch from an export focused economy to a more diversified economy with more focus on consumption like the US has. The latter however is kinda hard to achieve due to my first point abt the well paying jobs shortage and the first is rather hard to achieve because all our parties except for Greens and AFD (Idk the AFD's stance on this issue) are in favor of the "black zero" policy which means the government can't take on any debt (or only .35% of GDP as its enshrined in the constitution)
@@toyotaprius79 "public infrastructure" is not owned by the private sector, the state and its institutions own the infrastructure. So blaming the free market for not fixing something they didnt even own in the first place is pretty stupid.
To be honest, at least the SPD and partially also the CDU are starting to see the need for a debt brake reform. You can only ignore experts for so long.
@@toyotaprius79 I agree but these are not the most prevailing problems. A return to real social market economy is however neccessary to secure long term growth. What I said above is neccessary to even get our country back on a growth trent
I recently graduated from TU Munich, so I can share some insights. I have friends running startups here, and most startup founders are willing to move to the US because of the insane taxes, lack of VC and complex bureaucracy here. + Most of my talented local German peers are willing to move to Switzerland or the US (because of taxes and salaries) + Many skilled expats are also considering moving to other countries (same reasons as for locals), even if some of them have been here for 10+ years. + It is highly non-trivial to find a job after completing a Master's degree at TUM (can judge from the perspective of mechanical engineers, computer scientists and biologists). For me, this is a clear indicator that I can't bet on Germany's economic prosperity in the coming decades.
so out of all countries in the world Switzerland and the USA seem more attractive to you. wow Germany is DOOMED (unlike the other 190+ countries which you supposedly would rank below Switzerland as well). In short: You're an idiot.
With a bachelor degree it might be tricky. But with a master in mechanical engineering, and some form of network you build with interships and thesis you should be able to find a view offers. Especially infrastructure related companies like Siemens, DB, Herrenknecht, Liebherr need a lot of people. The only sector where companies seem to be afraid of employees is automotive. High salaries and taxes wont make or brake your startup, unless you have to get cheaper than established competition. What really is tricky in germany is building all the helpfull connections to the fragmented landscape of businesses. In the US it's easier to get the necessary capital and connections, but they also own you and set your "toolbelt" you have to use. Switzerland is really interesting, because you are still in reach of the german landscape of companies, but it's more enabling. Like Belgium and Letland as well.
Excellent piece, I have been disappointed at how the slow down in Germany industrial production have been put as a big issue while in reality, when you sit back and look at the big picture, it is not a reason to panic.
Joeri, you've really laid out the best case scenario for Germany and that's to basically stave off collapse. A lot of things (domestically & internationally) would have to go right for this scenario to play out. I'm less sanguine (but not insane like Peter Zeihan).
The value of such positive data supported takes are incredibly important to change the public's mood (workers, investors, consumers). Particularly appreciate the honest warning at the end about the need to compare with other analysis as well possible scenarios taking place rendering this take inaccurate. Well done!
For those who also found the chapters naming to be obfuscated: 0:00 - Intro 0:39 - Germany's industry is resilient 4:32 - Profit from fragmentation 5:56 - Germany's democracy is working as it should 7:16 - Germany's demographic decline is manageable 9:19 - Germany's current problem is temporary
The trouble with the "democracy working as it should" is that while yes, governments can and do collapse, nearly all parties here share the same neoliberal austerity core that under Merkel brought us to this exact situation. We have an insanely high level of infrastructure investment deficit, which a resurging economy would need to be fixed, yet most parties - the CDU chief among them - will ensure that we will invest nothing into fixing their mistakes.
Problem is also that Parties willing to spend more, mostly want to spend in social Costs and subsidies, instead of infrastructure.Also Energy Market with the complete unnecessary shutdown of nuclear Power has seriously worsened the competitiveness of Germany under the CDU
@@abctutnichtweh1you have to invest in social costs. The problem is rather that we play one off against the other. Social costs shrink when you invest in infrastructure, science and companies. Until then, you have to pay these costs, which stabilises demand and therefore companies. It is also important regarding demographic issues. You need to keep the situations of families stable. Instability has an effect upon how children perform at school. And this has a long term effect to the workforce of the future.
@@abctutnichtweh1 it is always surprising that voices from the conservative sides are asking for fiscal cuts on the money that jobless people get, while conservatives also tend to be the most frightened of crime rates. But the less the poor have, the higher the crime rates will be. Simply restricting money to beneath what it takes for survival is not helping people to find a job, nor being the best incentive to do so. Beyond that, the social spending can be seen as a subsidy, as the money directly gets spend for consumerism (and returns in tax form), while cutting taxes for the rich results in savings, not incrased spending. Also i think it is very short sighted to simply blame the nuclear power exit, when other european nations have very much the same price level. The spike in energy cost some years ago has been solely due to the high dependence on russian gas and oil, which play only a little part in the german energy mix for electricity. At this point nuclear would be a lot more expensive than any other electricity form, while also being far from clean.
@@n9o you mistake me If you think iam "conservative". Iam simply stating an economic fact. Social payouts dont Change the structural disadvantages of Germany.
The rundown of economists in 2012 was that during the times of 2022-2028 the economic growth of germany will slow down or come to a halt due to redistribution of energy production. This is broadly the fact as its happening rn. HOWEVER the same economists also said that the cutting off of oil will free up ALOT of capital from 2028-2030 onwards, truely unleashing its economy. Heres to hope
coming from a german automotive supplier industry that needed to be flexible and global from the beginning of the century. I see it the same way you descripe! Of course a goal of the economy every peak of change at the global market but the flexibility is strong to transform.
As a Nanotechnology Engineer, who is born and raised in Germany and studied here, I can't find a job for almost two years. I think that's enough to tell in case of "High Tech, Future Economy etc."
High Tech Niche Jobs are basically non existent in Germany. You think you would be an wanted person but nope nobody wants you because there is simply no demand. Why Germany even offers these Study courses is a mystery to me. Even the actually quite massive Movie Universities here are like for what exactly? German Cinema produces garbage that only boomer germans want to watch and all the talent is going to england or the usa. We train them but cant keep them. So stupid.
I am Iranian in Germany and what I see is a very stable system that keeps people in check (though things could be better) but when I see Germans complain about a possible collapse, I wish I could take them to Iran to show them what an ACTUAL weak economy and instability looks like. Wir müssen uns beruhigen.
I think the reason might be two different comparisons. #1 You compare the current german condition to Iran. -> sure we are far better off #2 Germans compare the current german condition with the germany they know from the past. -> we are worse off
@@kisscola Yeah i guess i have different standards. I believe we should accept dangers but reject panic. in iran we are panicking since we rejected the dangers too long.
@@kisscola #3 however: it's the same for everyone else aswell. So, we also need to put things into perspective. If you look closer, it's basically Marx again, we are in a fierce fight between classes. If we were to actually tax the elite earners/owners of wealth in a truly socially "fair" way, these problems would be rather minuscle.
I don't know about the argument for new factories moving out of the country when most of these new factories are becoming more and more automated, are we sure factories aren't moving out because of the sky high electricity cost and bad business climate, rather then skill shortage? Why would VW open a new factory in the US and pay higher salaries, instead of staying in the Germany? Does the US really have that much bigger skilled labor pool? And won't this as a result pull even more skilled German labor into the US with the higher salaries causing even further skilled labor shortage?
The US certainly has a healthier skilled labor pool. That said, I don’t think a skills shortage is the only reason (though it is a reason) that some industry is leaving Germany. Germany is a real awful place to be as a business, only really held up by the fact that Germany is wealthy and highly educated. The actual business part of business is awful though, everything is regulated to the point that you can’t really do your job properly.
@@isawrooka4 This guy also forget to mention, that all those feats were possible the world population was still growing, there was more and more demand. The landscape have changed, couples only own pets, and invest their money in stuck and other stuff. If everybody keep doing that we will head to the mother of all crashes.
@@isawrooka4 Yeah true, the skilled labor pool is healthier in the US, but how much of it is due to domestic vs immigrant skilled labor is what I was aiming for(though I didn't clarify). A lot of the highly educated people were already moving from EU to the US and this will just further exacerbate the problem.
@@robymaru03 youre acting like Germany was providing the entire world with machines etc. in the last decades. That is far from reality and many countries have opportunities to grow in the future, meaning they will need machines. If thats India, Indonesia, Mexico or parts of Eastern Europe taking over China's role as the world's factory or Africa's further economic development. Growth in the past decades was centered around China and the US, thats soured to a degree but doesnt mean there arent other options
As a someone who moved from the Balkans to Germany in 2020. let me give you a reality check. 20 years ago, if you were to ask anyone in the Balkans should you live and work in Germany, the answer was a resounding YES! Today, that is no longer the case. Rising living costs in Germany, with salaries that no longer match the conditions, have made Germany quite unappealing to almost everyone. I say almost, because the only people willing to try their luck here are the ones who are absolutely on the brink of poverty in their home countries. Those are not skilled workers that Germany needs. I am a software developer, and even with bonuses offered to me for recruiting someone to come and work here, I cannot find anyone willing to come anymore. IT people earn similar wages elsewhere, with significantly lower living costs. In fact, I know more IT people that went back to the Balkans, then people who came here in the last couple of years. Unfortunately, the future doesn't look that bright for Germany with it's current course.
Thank you! Skilled workers LEAVE Germany since decades (150.000 per year), millions of completely unskilled and mostly not motivated immigrants produce only costs but no profit for the German economy. To assume, that Germany has a bright future just because of fertile immigrants is completely reality-denying. People who want to work, LEAVE Germany. People who don‘t want to work, come to Germany. That‘s the reality.
Your video really remind me of the dog meme with the house on fire "THIS IS FINE", as an economist you should know this golden rule that “Past performance is not indicative of future results”, things are really different this time around just like a young kid can easily recover from a big fall and some broken bone, for an elderly it could take him to the grave, an aging population complicate everything for any economy.
Germany is the only big country which didn't take on new loans to combat the international economic crisis. The growth of a lot of the other nations was solely due to new loans and massive investments into the economy. We can't do that here in Germany due to our constitutional debt-brake.
You are not as good as you think when you are on top, and you are not as bad as you think when you are down. And this also applies for countries. Great video!
There are already enough graduates and juniors with a few years of experience in STEM fields from German universities. But they are struggling to land a job (even being ready with 35K Euro/ year brutto ) as companies are not ready to hire freshers or juniors. Instead of outcrying about the skill shortage for more than 5 years, companies must leverage these graduates, train them, and within a few years, they will be skilled enough to generate revenues. Eventually, these skill shortages can be minimized. At the same time, the Rathaus must improve their visa-issuing processes to avoid unwanted waiting periods. If you analyze more, the Kelin and Mittelstand companies rely heavily on projects from big companies. The downfall of one big corporation has a ripple effect on these middle and small companies as well. Still, I hope this phase shall pass like the past wars and recessions.
About sponsor: How funny it is, I was expecting ground news but never The Economist. And the brand reputation really helps, I hope the Economist sponsor more projects on this channel.
If you live in Germany, your financial situation might paint a different picture. Germany has some of the highest energy costs in the world, driving up the price of nearly everything. The country's wealth has long been built on its powerful automotive industry, with every sixth job tied to this sector. However, two key pillars supporting Germany’s economy are faltering. Affordable energy from Russia, crucial for its manufacturing-based economy, is no longer available. At the same time, the Chinese automotive market-a vital export destination for German car manufacturers-is in decline. In other words, two major foundations of Germany’s economic strength have either collapsed or are on the verge of doing so. The cost of living in Germany rises year after year, leading to growing dissatisfaction among the population. This has fueled the rise of right-wing parties, which gain traction by offering simplistic solutions. While these solutions may lack logic or sustainability, history has shown their appeal in times of crisis. Both World War I and World War II demonstrated how economic hardship, such as inflation and mass unemployment, can pave the way for radical ideologies to take hold. It’s worth remembering that Hitler rose to power during a period of significant inflation and with six million unemployed people in Germany. In times like these, optimism can feel like a scarce commodity in Germany.
pretty lack luster analysis imo: "the Chinese car market is in decline" - it isn't, what's in decline is demand for German cars as they are now far behind their competition technologically, are usually more expensive and their EVs have all come out later, that is solely the German corporate leaders' fault, they ignored Tesla and the electric market shift as a whole for way too long "most expensive energy" - Germany semi-privatized its energy sector in the early 2000s, energy production, transport and trade are now all run on a for profit basis, this obviously creates an incentive to make money which drives up prices, corporations saw this coming but did nothing, same for the conservative/neoliberal government, instead of huge investment into the infrastructure and electrification of industrial processes they went for (short term) cheap russian gas dependency and gave the industry an easy way out, german automakers returned record dividends for a decade but invested little to nothing in meaningful transition of their manufacturing processes - economists, allies and politicians warned about this for years - also: absolute cost is high but relative cost is lower than in some other OECD nations - phasing out nuclear before coal and not putting heavy invest into renewables didn't help all in all Germany pretty much fucked itself through incompetent political lead, given the decline of Britain and the trade war the US started with China it would have been a big chance for Germany to step up and profit from that but they didn't, instead were and still are busy cleaning up the wrong doings of the past 20 years my opinion
@@benzo___ I totally agree with you! I said "the Chinese automotive market-a vital export destination for German car manufacturers-is in decline" and I meant exactly that what you wrote. More details are coming out. German managers did not invest in future technologies or sold it to china, to get a bigger bonus and to keep the share values high. Without Mercedes there would be no Tesla. I do not see a solution how Germany can fix this mess, but it will cost blood. It already does.
Thank you for this video and the evidence-based comparison to other economies. I am a german engineering student and I don't understand why the majority of people in Germany are always so worried about the future and over-sensationalize every piece of unpredictability. We have many of the biggest tech-companies in our country and still have lots of smart people around. What we now have to see is a decline in bureaucracy and the trust in innovation. We are good and and hard-working people.
Never really understood the gloom and doom for German economy. Maybe a downturn while reconfiguring its economy, but there is no lack of capital or talent in the country.
@@ToriZealot Energy prices are back to pre pandemic levels. In fact adjusted to inflation they are LOWER. Germany always wasn't able to match energy prices of the US. This is nothing new.
@@IsomerSoma The world is changing and Germany is loosing global market shares for years. There are multiple problems. I do not see that any problem is taken care of.
Germany's current biggest problem is the lack of investment by the public sector. This makes it harder for the industry to get back up to speed, it makes it more difficult to increase productivity, it makes it more difficult to overcome infrastructural and energy problems. So, I like this analysis and I am so frustrated that so many Germans still believe in the "Schuldenbremse".
@araara4746 The public sector is investment by public sources, so the federal government, the states, and the cities, including their various institutions. On the federal level, there is the possibility of spending more, but it restricts itself, mostly due to ideological positions that think that public debt is a problem - empirically it is not actually a problem per se but that's a different debate. States are already very restricted in their household law, which is tricky for them to change without federal support. Lastly, cities are most important for investment in public infrastructure, as they build most roads, most water utilities, schools, etc. However, while they have huge responsibility, they are also the most restricted financially. So the only player with sufficient financial capabilities (the federal level) does not want to pay more and the other 2 levels are not able to pay more. As a result, Germany is behind on internet, the train tracks are outdated, the schools are outdated, the universities are understaffed, the cities are dirtier, the health insurance and social insurance becomes more expensive, and more... People feel that and they are disappointed by their cities, states, and federal government. More and more are voting for radical parties now, which will only make things worse. That's what happens if the public sector invests too little. For the private sector the costs of production are more relevant. Generally, Germany can counterbalance the high costs with very high productivity. However, lower electricity prices would help for sure - which could be achieved with more public investments. Also, public investment usually increases private investment, as it reduces risk for private investments and increases demand for businesses. That's the good thing about public debt, which many politicians don't want to see. Public debt is good for the private sector.
@@araara4746 it is simply put lack of political will - Germany's debt ratio is around 65%, the US sits as 125%, if Germany was to increase its debt ratio to just 100% that would mean 35% of the GDP or around 1500 billion € could be invested as infrastructure spending, be put into the economy as stimulus or used in other ways to boost GDP and investment, this would also slightly devalue the € which in turn makes it more attractive for other markets to import European goods because of more favorable exchange rates
Germany's machinery sector should not be understated, and the US and China cannot maintain a competitive edge against the machinery produced by German, Swiss, and Dutch companies. ASML is just the tip of the iceberg, there is an entire supply chain located within Germany, Belgium, and the Netherlands which the entire world depends on.
This. So much this. Yes, a lot of our "Mittelstand" is HIGHLY specialized in these, but we are still and will keep being for the forseeable future - the people who create the machines who enable to produce the stuff people want to buy cheaply. Oh, and overprized and overengineered same-ish products nobody but wealthy people can afford these days.
I don't think german economy will collapse but it might transition from manufacturing to service based. As the world moves more towards solar energy, near equator and southern countries would have much cheaper energy cost than northern countries.
@@jagolago-bob I disagree on that one. People are always friendly in the shops in the region where I live. There are others, where this isn't the case, though. Service in large cities seems to be less friendly, people are more in stress there.
ah, people who don't understand how energy systems work. how cute. Let's just say that wind and solar don't deliver what we need them to, and leave it at that. The functioning and demands of our energy grids is an interesting and critically important rabitthole to dig into a little bit if you want to understand in particular Europe's trajectory in the coming years.
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Not sure about your evaluation of the german government. I think it was much better then its reputation. I also think that the future of Germany is much better than this news cycle will tell you :)
It was. It had to face many strong crisises. You look bad even when you perform good, since the people do not like the situation. Esp. the loss of the supply of gas could have caused much bigger problems. We never had a breakdown of electricity.
@@ThomasVWormthats Not because the current Gouvernements l, but previous Administrations....... Energy Security has decreased significantly since 2016
I agree. There have been many problems with the Ampel, but all in all it has been a rather good government. Most of the media bashing was unjustified. It had had developed into a sport of some sorts. Though, I am not so sure about the bright future part. I REALLLY don't want Fotzenfritz Merz as Chancellor.
No word about the hight price of energy, about the competitive chinese machiary industry, nor to the access to the before profitables and wasted chinese and russian markets.
Only a vatnik believes living under the Russian heel due to cheap energy is sustainable. Germany have had their chance at cheap energy, but they decided on burning coal and getting fed by authoritarian states and selling their souls at the same time.
Energy prices are down and electrification is picking up steam. Also check out all the planned electrical storage projects in the country. We are on our way to show the World what a modern electrical grid looks like
ngl seeing this straight up makes me doubt it. Just because it was resilient before it doesn't mean it will, just like those youtubers saying China will collapse and here it is still
Right , past challenges mean nothing if the new challenges are shrinking market because of a competition from newly emerging China , aging demography lack of access to cheap energy and so on .
Thank you for a succinct and seemingly well-researched analysis :) A bit of grounded optimism is exactly what is needed - to counter the typically more negative attitudes that can come to the fore for Germans 😅 Also hope the next government watches this! Keep up the good work!
Germany has faced serious economic crises in the past, but has often been able to emerge from these crises with strong reforms and continue to grow. While the current challenges are deep, past experiences show that Germany has the capacity to overcome these difficulties
Hi, I really like your videos, no nonsense and well researched and also referenced. I do not have a degree in economics, only 'general university level educated', so some things sound very simplified to me, but maybe they are fine in the economic discourse. Good example is in this video, you say it would be better (or at least not a big loss) if a company moves production away from Germany, given that the country lacks skilled workers, and the company moving frees up some workers. But a) is it so easy to assimilate skilled workers elsewhere? Skills might be very specific to a company's production. And they might have to move far away, maybe they don't do that, or it is a very slow process. b) Isn't it simplified to look at a country as a very homogenous entity? A region in germany probably is fairly independent, and if, say, all industry abandons the south, maybe the south ends up very poor. And a while the country might not worry too much about that, the region should maybe fight tooth and nail to retain its industry. Again thanks for good content. :)
You cannot make a comprehensive prediction about Germany's future, even just economically, without even mentioning the elephant in the room. Most people living here are starting to develop a pretty clear picture of where this is going, and let's just put it like this: All the issues analyzed in this video (as correct as the analyses may be), are symptoms of a much larger problem. Take a stroll through a western german city and ask yourself: "How much of this is going to be improved by having some more startup companies and innovation?". Also, all of the diagrams concerning population might be numerically correct but at least highly misleading: The amount of actual wealth and properity created on average by a million people in Germany in 20 years is going to be a tiny fraction of what it was 10 years ago or even today.
@@makeplay8004 Sure. I'm going to take myself as an example. Despite all the economic problems mentioned in the video, I don't think I have to worry about my job or the money I make and most people around me seem to view this simiarly (we work in STEM). With my first child on the way, I just have to compare the childhood they would have here to the one I had 30 years ago to get the "clear picture" I was speaking about. Everywhere I look, the system leeches off the working population more than ever before, despite delivering much worse outcomes than ever before. The education system is cooked, having never recovered from the 2015 migrant crisis, then Covid and Ukraine happened on top of that. Public health system is broken, we end up paying doctors out of pocket in order to not have to wait months for an appointment (after paying a grand or so a month for the health insurance). The infrastructure is broken, public transport is a joke and our "Autobahns" are in terrible condition, bridges literally broken down, leading to much longer travel times per kilometer than in our neighboring countries. The city I grew up in is basically irrecognizable, shops closed down, garbage everywhere, violent crime rampant. I could go on. The point I was trying to make is that if any of these problems were downstream of economical issues, they'd already be fixed and many people understand this by now. Everyone I know makes enough money and yet everyone is talking about leaving.
You're applying there is an elephant in the room. What is that elephant? Also, I agree with you. I feel like this video is poorly researched. Feels more like a piece of propaganda to drive stock price up
I would be really interested in your take on 1) the Russian economy , since everyone is talking about its downfall, and yet it is still standing; 2) the Milei government in Argentina, since it’s been a year and I heard contradicting reports (stabilisation of inflation vs explosion of poverty). Thank you for your work ❤
Hey, I only watched two of your videos so far and I can firmly say you're the only optimistic German I've ever met. 😅 Btw, you forgot to mention the energy prices.
I disagree with a few of these points: 1. The industry is well diversified, but all industry consumes energy. Germany industry used to rely on cheap Russian gas, but now with that out of the picture for the foreseeable future, all German industries are going to suffer to a smaller or greater extent. The construction is sturdy, but the foundation is beginning to crack. 3. Democracy is like an elastic band: the good ones can be pulled a lot for many times, but it only needs to break once before you need a new one. 4. Not all immigrants are created equal and immigration isn't a "get out of population decline free card", it's a trade-off. Are the immigrants currently coming to Germany going to fill the skill gaps in the economy, and what are the opportunities and challenges that they bring? I believe Denmark had an interesting study on this. Japan and South Korea have very low immigration levels, while Canada and Sweden have very high immigration levels, and they're all struggling in their own ways. There's a lot of talk about economic and environmental sustainability but not a lot of talk about societal / population sustainability.
Only under the efficient market hypothesis, which you can argue is more true for the stock market, but cannot be more wrong for labor market or the general economy
I'm not so sure that the next government will be better. If FDP manages to stay in parliament and is the chosen partner for the Union we are fucked because there will be 0 investment.
Germany is for sure going down the river, there aren't enough young people, a lot of unqualified foreigners. The taxes are stellar high and salaries low. Germany exports a lot of goods because the salaries are very competitive (low compared to the high efficiency). There is a sort of crazy federal law, which forbids the government to borrow the money to invest in the infrastructure and education. All state agencies are underfinanced. I earn 7K brutto and receive only like 4K neto. Small apartment in a big city costs like 1.5-2K Euro etc. I can hardly imagine how the life with an average salary and children might look like.
Unless you live in Munich you don’t pay that for a small apartment. We live in a nice 65sqm apt in a pricier city in NRW and pay 1000€ warm. Contract is only 3 years old, so it is not an old contract either. We considered moving to a slightly bigger apartment and found that 80sqm with 3 rooms would be 1200ish per month warm.
Frankfurt 1000 euros warm mite normal salary 2000 neto plus 200 groceries and other stuff at the end you have like 500 euros for myself if i had kids i would be in debt😢
Unlike all the other countries you mentioned, you personalized references to the US. Trump is not a rogue factor, but the will of the people. Say the US wants this or that, not an unfavored individual.
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I work in the chemical industry, one of germanys industrial backbones besides steel/automotive. Most people nowadays want to work for the state in the public sector because it provides Jobs that are literally guaranteed to exist. There is no incentive for young people to work in industry besides some mayor mayor industry Leaders like Carl Zeiss, Siemens or Bosch. Most people prefer low paying public Jobs with benefits like Home Office etc. They really need to innovated the tax System to Support people that want to work a lot to get germany back on track. Besides that the legal side of making Business in germany is such a nightmare that many companies prefer states like poland over germany but not for their cheaper workers.
@@chrisgeyer4002"no people" - we have 83 million and rising. Additionally, robots and incresingly ai have already made the average German worker way more productive than in the past.
@Marvin-ii7bh your population is only rising due to migration much of which is unskilled and contributes nothing economically and actually is a leach on the economy. Your native population particularly the working age population will be growing smaller and smaller as each year passes. AI can help a little bit it's not going to be enough when your working population shrinks by a third over the next 20 years. Germany will be as poor as a Latin American country by the second half of the century baring a miracle.
@@chrisgeyer4002 😂Mexico's GDP per capita in 2050 is predicted to be $42,000. So over the next 26 years, you expect the German economy, not even to have 0 growth. But to decline by 0.87% a year. That is degeneracy and will never happen. Cope.
@Charlie43348 You cleary are clueless and naive to how bad an aged population with no young people of working age will be for your economy😂true cope. Good luck 💀💀
I live here, I'm not nearly as optimistic. Everyone has stopped hiring, our old ass government is clinging to outdated technology and subsidising them at high cost whilst not investing in R&D nearly enough. The "skills issue" is bs. There's plenty of skilled workers that can't find work that remotely befits their skill. Plus were full of old people who will soon elect the oldest man in history to be chancellor who will make things even worse.
I don't mean to be harsh and I agree with you on the fact that Germany's economy is really resilient, but the part about Germany's democracy working as it should is so stupid. Yes, the institutions are working, but the government didn't collapse because of public pressure, it collapsed because the libertarian party purposefully sabotaged the coalition. And the public pressure was mostly a product of right wing media outlets trashing the kind of left leaning government. If you look at the facts about the Scholz government, they had to deal with multiple global crises at once and had to make up for the lack of investments into public infrastructure during Merkel. Yet, they still managed to reform social security, lower the cost of public transportation and get renewable energy production to an all time high. They were doing so well that the media had to focus on migration as a problem again to spread fear and hate in the population.
Don't know, I would never migrate to Germany, salaries are lower for Engineering positions and taxes are crazy high. Myself and other engineers would love to move to the US for salaries way higher than here in Mexico, but surprisingly engineering salaries in Germany are almost equal than here, and actually lower in places like Spanish. Europe is in frank decline.
Salaries are also determined by supply/demand. Lower salaries doesn't necessarily mean 'Europe is in decline', it can mean that there are enough engineers in Germany such that competition occurs between job seekers rather than employers, hence employers can offer lower salaries and still maintain a full workforce; likewise, in places like USA, Mexico, and.. 'Spanish'? Spain?, they may have Engineer shortages, which pushes competition between employers rather than job seekers, hence much higher salaries offered because job seekers have more choice on where they'd rather work. And that's just one potential consideration, there are probably many, many more factors to consider before jumping to "decline" drums. If Germany is declining because of demographics, then every country in the world is basically in that boat except those of Africa and some other pockets in the middle east and Asia.
Well...but we have free education, affordable healthcare, better quality food at lower praises. 20-30 vacation days (sick days are apart of them), and it is not exactly expected workers to make long hours at work just because. I think Europe is still pretty much fine.
Thank you for your video, here in germany it is all doom and gloom. Your perspective was one i didn´t thought about, especially with those arguments. Refreshing to see a positive outlook. Reality is proably somewhere in between. I just hope our politicians get their act together (soon).
That was a lot of Copium. Here's a tip pretty much every Western country is complaining about a "skills shortage" its not a sign of a booming economy its just businesses wanting skilled workers for low pay and having a tantrum when it doesnt happen. Its probably more a sign of low productivity growth.
Alright, german economist here. No the economy is absolutely not fine. What we are seeing is the tip off the iceberg. The layoffs are worse than in the 2008 crisis. Consumtion has been down the drain for a few years. No consmption, no sales, declining production and so on and so on. Typical deflationary spiral while at the same time having inflation due to money printing. It a complete and utter disaster.
Printing money is literally a myth that doesn't lead to inflation. If you believe in monetarism, it's no surprise that your analysis contradicts itself. There is a lack of investment in Germany - I think we can both agree on that. There is also a lack of consumption. And what could change that? More investment by the state to increase investment in private sector and increase consumption.
I think many Germans don’t fully grasp the beauty and the seriousness of what I believe is a very accurate observation. The video essentially argues that companies unable to offer competitive wages will lose their foothold in Germany and eventually relocate their production sites. This isn’t necessarily bad news, as it allows employees to transition to growing industries or companies. In Germany, there are regions where finding workers is nearly impossible, and others where talent exists but wages or working conditions are poor. This situation requires people to be flexible, not just in switching industries but potentially in relocating to new cities. For me, the real issue in Germany lies in the lack of flexibility among workers. Many are unwilling to restart or adapt to change, which creates a significant obstacle. Additionally, there’s hesitation to create a more welcoming environment for talent, even from other European countries. As long as flexibility improves-likely driven by economic downturns-I don’t see this as a long-term problem. However, the current lack of adaptability remains a key challenge.
I agree. Germany has problems that can and will be fixed. We did so in the past, and of course we will do so in the future. We have some difficulties right now, but we are already working on solutions and will be on track again soon.😊
I'm surprised you didn't address the likelihood of anti-immigration parties winning the next election. That would have a big effect on the future population growth if they get more hawkish on people coming into the country
It's because Germany is a coalition country. They are at 18% in the polls. They will surely win in that they will do much better than before. But, I doubt they will be allowed to join a coalition to actually govern. We'll see.
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Further reading from the Economist (more pessimistic case and update about the fall of the government):
1. www.economist.com/business/2024/10/31/volkswagens-woes-illustrate-germanys-creeping-deindustrialisation
2. www.economist.com/europe/2024/10/24/angela-who-merkels-legacy-looks-increasingly-terrible
3. www.economist.com/europe/2024/11/07/germanys-fractious-coalition-falls-apart-and-how
Richard Wolff would run rings around this
Turning into a pretzel
You look like Alfred the Great from the Last Kingdom
Economist is a shareholder capitalist mouthpiece
I like this guy. His answers are great--- short and to the point. I'm from the US, and the Native- Americans have a saying, (originating from when they were getting screwed over with worthless treaties full of legalese jargon, and rambling, flowery promises). They said, "It does not take many words to tell the truth."
As a Pole, I keep my fingers crossed for good fate of Germany economy. Germany is the biggest trading partner of Poland and (probably) the biggest investor in Poland. Sure, Poland can survive without Germany, but both countries will be better if both economies do well.
Poland has a lot of room to catch up, that is why they have big growth right now. But i agree, both countries need each other. But i feel Polands demographic problem is worse then Germany's. It got "fixed" a little by the Ukraine immigrants, but normally Poland's immigration is to low to fix it.
Jeden z niewielu głosów rozsądku...
Poland is one of the reasons Germany's industry is failing. German fabric goes outside of Germany, like Poland and other countries, which misuse the EU for only their profits...
@@3komma141592653imigration doesnt fix demographics it makes it worse
The rundown of economists in 2012 was that during the times of 2022-2028 the economic growth of germany will slow down or come to a halt due to redistribution of energy production.
This is broadly the fact as its happening rn.
HOWEVER the same economists also said that the cutting off of oil will free up ALOT of capital from 2028-2030 onwards, truely unleashing its economy.
Heres to hope
As a german, I can tell you this whole "skilled workers shortage" is completly overblown or completly nonexistent in pretty much all branches of the economy besides the medical branch including hospitals and retirement homes.
Companies, especially in the trades, keep complaining about not finding enough young people to train, however they offer shit pay, shit working conditions and don't respect their employees. Not hard to guess why they do not get enough young people.
Exaclty, its mostly them being not attractive and border line racist to immigrant labor
Exactly!
There's no skilled workerforce shortage, there's shitpay workers shortage.
@@theMarIlazi Or average pay, but sell your soul - shortage. 😂
"Respect " Is really lacking. "Teamleiter/innen" should also understand how to lead people this is very important in workforce. It's a kind of motivation which keeps employees to stay and wanting to come to work. At least if people are depressed every months earning minimum wages which is less, They deserve to be motivated and earn [Respect].
I just looked up your name and found it without a sweat, I'm so grateful
Just a reminder to everyone watching "the economy is doing well" or "the country is doing well" doesn't directly translate to "the majority of people who live in the country are doing well"
the people are not doing well + the economy is not doing well
Likewise, remember that headlines like "AI will steal ALL jobs tomorrow" and "The economy is in shambles!" are sponsored by big corp to discourage you, the average Joe.
Yet then you have people here blatantly crying out BUT THE US IS DOING SO MUCH BETTER ECONOMICALLY THEN THE REST OF THE WORLD!!!!
Well guess what high gdp doesn’t mean shit for the average Joe….
@@paulchen9145Americans have it better than most but cry the most
Americans are very rich right now
I couldn‘t agree more. Having lived through the sick man of Europe debate early 2000 were everyone qualified Germany as doomed only to have a debate about the ‚insane productivity’ of Germany 10 years later that would tear the eurozone apart. Now another 10 years later things turned upside down again. Yes, Germany has significant problems, but they are all manageable. Most important is imho is reduction of bureaucracy and overhauling the tax system.
imho you are right
Danke ! A bit historical perspective allways helps
We need our own Milei
It's so bad that the middle class is paying more than the super rich in germany. The tax system definitely has to be revised. And don't get me started on bureaucracy, I've been waiting to plug in a solar panel for the past three months due to concerns over some animal gnawing the cable.
It's not even the concern that bothers me, by all means, let's secure against that. What bothers me most is that the person responsible brought up the issue and haltet the entire project but doesn't implement the solution nor allows anyone else to deal with it.
We are at a bad spot in Germany but hopefully with a good government there is always the possibility to turn this around!
I am from Germany and I wish more Germans would talk about our economy like you did. Unfortunately all this talking about bad German economy is just a tool for right wing parties to win elections and a tool for Putin to destroy democracies. I hope the CDU politicians will act wiser after the elections. CDU and FDP held German economy hostage by making badly needed investments impossible because they wanted to destroy the coalition. I hope they will act more decent and less destructive after the elections. But I fear they will not do it and just act like Trump and Musk.
Lord help us... They say only the Universe and human stupidity are endless...Do you even realize how important was the cheap gas from Russia for the German industry...Americans set you up twice in history by those two world wars,and now they blow your Nordstream gas pipeline ,and on the top of that,with the most stupid story called IT WASNT US... My GOD...What is wrong with you people...
This feels like a fairly optimistic take on Germany's future.
but entirely made up
@@ToriZealot ur a Tucker Carlson fan, no wonder you stating false stuff everywhere here
It's the most realistic take yet. Germany's GDP growing by -0.3% one year and ~0% another year does not a collapse make. The reason everyone's seemingly shouting from the rooftops Germany is "collapsing" has nothing to do with economic reality of Germany and everything to do with economic reality of advertising space on the internet especially in the English language where everything has to be sensationalized to high hell and narratives, which started taking over sports discussions like a decade ago, have now taken over all other news as well. So once a narrative that sells well - like "Germany is collapsing" - takes hold it's very difficult to dislodge it because it's more profitable to keep it going.
Extremely optimistic take. This is 100% pure copium.
The world wasn’t as cutthroat competitive as it was back in 1990s nor Europeans had stranglehold over their colonies like before 1970s. Europe is extremely resource poor.
@@BrokeBillionareGood point, but the Germans are a very resilient people, they survived two world wars, even the Roman invasions. They may decline but they are one of those people that can rise again, many lately speak of Poland as the great European leader, but Poland has never been as outstanding a country in Europe as others, I bet more on Germany to be honest.
I (a German) thank you very much for your encouraging words. That was very good to hear.
Lies? You like lies? Well no wonder germany is where it is. Fools wanting positive lies than the truth.
Wake up. There is no skill shortage. If there was wages would go up.
my friend no. he is saying the same old bullshit lies of "Capitalism finds a way." and "the market solves itself" lol. he even said companies leaving Germany is good news even if thousands are losing their jobs. typical Capitalist psychopath economics. German is NOT doing well, but don't worry, you will never starve or be homeless
@@mcmarkmarkson7115 wages are going up btw. believe it or not, an entire fcking economy doesn’t react to changes as fast as a few days
@@mcmarkmarkson7115while i agree that politics in general are currently a clownfiesta. Istead of working on solutions for ongoing problems as a unit, the Ampel has only rly managed to throw blame back and forth. Along side afd gaining votes whilest being a threat to our democrazy and not at all being a "alternative" i could ever consider. Its rly hard to even find a party i would wanna vote for come febuary.
Overall the living standard is still impressively high though and anybody who is complaining about it is just spoiled tbh. Having lived 9 years in Namibia and visited alot of Africa, its rly alienating for me to see alot of germans complain. Ofc im not saying too turn a blind eye to politics, but the complaining and raging part of the population is neither helpful to find a solution nor is it necessary.
@@mcmarkmarkson7115 Wages did go up. Lies are only a thing for Trump supporters, lol.
A few notes from a young professional working in industry: Unfortunately the government problem is not so easy to solve. It currently looks like we‘ll get a CDU-SPD coalition. Both parties are pandering to (soon to be) retirees instead of investing in our future. The cost of housing problems are also a hidden wealth transfer from young to old.
Although budgets are under pressure, we see plenty of work in the in automotive. Core strategic topics are still being invested in heavily, there’s just a stronger focus on value. There was a lot of excess hiring at least in IT of people with questionable qualifications, that companies are now trying to get rid of. But there’s by no means a complete bust of the labor market.
If you have some runway, now would probably be a good time to start a business and profit off of market shifts.
If young people actually went out and voted, that wouldn't happen.
Please don't take this personally, but what is "young professional working in industry" supposed to mean?
Germany wouldn't have a problem with questionably qualified IT people if they were willing to pay market salaries for decent IT professionals. But the unions and German companies in general seem unable to grasp that good IT professionals shop for jobs globally.
"questionably qualified IT people " LOL
Vote AFD and stop complaining about getting f**ked by the same old parties over and over
Would note on the argument that the government has low debt and CAN invest in the future: Germany is overtaken by a quasi religious dogma around public debt. People will somehow complain about the infrastructure and somehow completely fail to make the connection that the debt brake is the main reason why investments can't be made (and ultimately why the governing coallition broke up).
Sure, but surely that can't continue all the way down the drain through the pipe and into the water treatment plant.
The illegal migration is the problem. I costs us billions and billions of Euros. Also, as sorry as I feel for the refugees, we can not take all of them.
The Problem is not money shortage of the public institutions it’s money usage. And it’s almost completely used on social purposes that are in fact money for the lost and left behind to continue voting for left wing parties and stay quiet otherwise.
germany is actually not that low on debt if you account for all the money they promise to spent for pensions and stuff.
Germany has 2 big problems in that regard:
1st The government is by far the biggest employer, they want to make the people dependent on themself so they dont revolt and get voted again.
2nd The government spending is terrible allocated.
The government has to finally spent money more efficiently and not be wasteful.
Out of 477 Billion € 127 Billion (27%) is already spent every year on pensions, It will only go higher from now.
8% every year is wasted because of interest debt. If we would double our debt it would mean that 16% of our entire federal budget would be burned every single year. Since i dont think that they would allocate the debt effective enough, i would be hella pissed if they actually increased debt, i would like to see proof that they can actually run a budget effectively and so far i havent see that.
*Basicly what would happen is that we would have to increase our debt every year at higher and higher rates which would ultimately lead to bankrupt the country. Sure it is highly unlikely to happen in 5 years, but it only has to hold on for 20 years till all the politians arent there anymore right? People also tend to forget that being rich isnt guaranteed, history proofed that rich countries can and will go bankrupt if incompetent leaders with only self interest are at the top.
If you don’t have enough money to pay your rent that doesn’t mean you should go into debt to pay it. Maybe you should consider not eating out for every meal you eat.
There is more than enough money but the government is overcomplicating and overpaying on most of the stuff they spend it on. Have a look at the great projects „Berliner Flughafen“, „Elbphilharmonie“, „Stuttgart21“, the decision to lay underground high voltage/long distance cables on the countryside. Those are all unnecessary money pits with little value to society and the economy.
I'm a professional immigrant in the automotive industry. Specifically, software division at VW.
It's really hard to take it continuous beating from the media/social media due to illegal immigrants and failing politicians.
But 1 thing stands fest to me is that i want to see Germany succeed. I'm not a German. But i have been a fan of this country since 10 year old. I was hoping 1 day i could work here. And i took it because i really love Germany. It's so sad seeing horrible politicians take the media for rhetoric for very little action.
I got a chance to move to US with of course no criticism of immigrants since it's quite diverse and much higher salaries. But i want to be part of "building" story in here.
Succeeding in a challenge is the best feeling i have ever had before and I'll do my best this country to thrive again as a leading figure in my industry. Being part of this is massive.
So to my fellow Germans, do your best, this country shall thrive. You have survived much worse conditions with much higher resilience.
I’m glad you found your way to Germany and I really like your views and vision. I hope you succeed and it would also be good if you have some children, at least two 😅
Sadly it's not just about the economy but also about safety in the streets because of too much illegal immigration
Man fuck all that just come to the states 😂😂😂😂
Hi. How would you say that VW is doing, in adapting to the new reality of cars incorporating much more software/AI. People often say that this is a big weakness of Germany - its strength is in engineering rather than software, and it lags behind. Do you think this is true?
The problem with the prognosis of Germany excelling in a fragmented world economy is that the German exporters will still have to compete with the Chinese to dominate third country markets. Right now, for example, Chinese cars are making major inroads in Latin America.
that not even the main problem, the main problem is Germany is not a "3rd power" country. it is trap in the EU and does not have the ability to set an independent trade policies. and France is taking advantage of their influence in EU to basically screw Germany over with trade policies that does not favor Germany.
1 in every 4 new cars that are selling in my country are electric and 90 percent of those are byd . im from costa rica our electric vehicles have green license plates so is easy to spot them and when you check the brand : byd almost every time ... i have never seen any brand taking that ammount of market share in just 2 years . the great loser here were not asian companies like toyota or nissan since people here love toyotas they are quite reliable cars the losers were european brands .. THE SAME APPLIES TO CELLPHONES. huawei came out of nowhere and now every household has someone who uses huawei which by the way they are now call :"honor " is the same brand as huawei but they changed their names so sanctions dont affect them ... i dont like china what represents they lack of freedoms you know the drill , they have damage our ocean ecosystems BUT credit were credit is due BYD is crushing the competition here , not even that local sellers of the brand couldnt imagining how quickly people will buy them . while elon wasting time byd crushing them atleast in latinamerica , i dont remember the last time i saw a tesla but everytime i go out for a walk i spot hundreds of byd.
i forgot i remember a time were germany solar panels were a thing , well not anymore they gon copied by the chinnese counterparts and now those chinnese brands are selling really affordable solar panels ... i just think money and macro is too optimistic about germany , look i would have prefer a world were the chinnese goverment didnt have that much power cause like i said i just dont like them they have made so many bad things in my country for example they sell bad products counterfits in every local chinnese grocery store but again they are absolutely demolishing competetion in high tec stuff, so they sell you the counterfit and they also sell you good quality i think germans were too honorable to deal against the ccp of china..... they are still too naive ... i dont think this trend is gonna stop ..
Cars are neither important nor desirable anyway
@@Jonas-Seiler cars as a whole? Or. Chinnese cars.? Cause seriously byd is taking o ver a huge market haré in LATAM
No. The skilled worker shortage is a lie at least in IT. They are Not offering good wages.
So there are people currently in Germany, that have or would acquire the skills to work in IT, and are currently choosing not to because of the wages?
Because if that answer isn’t yes, just because a company would still be able to fill a position with higher wages doesn’t mean there isn’t an overall shortage.
IT is an exception in that AI just ate your job
@@matthias8582 even 50% of US IT salaries would be good. A senior software dev in Munich working for a local company can't afford to support a stay-home wife with 2 kids - it is messed up.
@@stariyczedun Munich is the most expensive place to live in the whole country 😂
@@stariyczedunThere you answered yourself, do you really expect you to support your wife and two kids on one salary? What kind of fantasy world are you living in? Tell your wife to go out working and put your kids in kindergarten. Your economic situation will improve dramatically trust me.
"a competent Gouvernement is coming" 😂 the Party which is expected to lead is the same party that stagnated our country for 16 years
Wtf are you talking about this time was the most stable time the country had. Let me guess you are leftist or right
@@goodmusic4673Bro it wasnt stable, it was decaying and running out the clock on bought time. Ir you honestly believe the country was doing great then, it means you didnt pay attention yet.
@@maeschder of course bla bla bla and some more bla listening to people like you is waisted time lol
@@goodmusic4673 you don’t commute by DB, do you? And you don’t live close to Leverkusener Brücke, do you?
Just remember Peter zeihan has NEVER been right about ANYTHING
haha exactly my thinking - if Peter predicted it you can bet it won't materialize
Zeihan has been totally wrong about China for many years. He's an ignorant jackass.
Technically he predicted the Ukraine war, to the week
How long before? A week? Lol
THIS.
How anybody can follow that snakeoil salesman is beyond me.
Yeah he touch upon topics that will become problems like demographics but where he totally fails is he hypothises from a state of vacuum aka the future is set in stone and nothing can deter it. which is totally wrong. Of course a country like e.g China will take counter measures to stabilize their low births or in this example Germany will bounce back. it will hurt but they will likely find a way
As a german i think saying "the economy is collapsing / going down the drain" is a bit over-sensationalized. But i also think we're not doing the greatest.
8:43 "Growing more slowly, sure - but growing nonetheless". I think that describes it very well. We are not doing THAT bad, really, the economy is just growing less than the US. And we always like to compare ourselves. But then people don't think about us having a more socialist state, more safety nets, less work hours and more holidays. The economy might not blow the others out of the water but at least the place has some nice living conditions.
And yeah, the collapse of our government is more seen like a good thing here. Not "oh wow, it failed, what are we gonna do?" but rather "well, people disliked the direction we're headed, great thing we get the chance to have a change to better the political situation more quickly now!"
I mean i don't wanna act like there are no problems. There are. But there are always problems and i don't perceive the current ones as unnaturally high when looking back at a new war in europe, covid, the "refugee crisis", the financial crisis - there will always be large issues. It's just different groups being affected. If you work at VW then well... i understand you might be troubled and look at this as a very hard time. But in my friend circle, colleagues, etc. i don't really see any people having a particularly hard time.
But Germay GDP contracted in 2023.
Maybe the worst is still yet to come though
You do realise that most of those problems were one's that Germany had a significant influence in either causing or exacerbating, right?
The new war in Europe - Germany
Covid - Setting EU policy
The refugee crisis - yeah Merkel did that
The financial crisis - Germany set energy and immigration policy for the EU - Now we all suffer for it
There were plenty of other factors. Though Germant was a significant contributor to all of these issues, yet they still act like the nobles of European politicians and admit not one mistake while having no plan to do better in the future.
There are no apologies. They simply want to ban or smear political parties that would do things differently.
Modern Germany is a disgrace, and Europe suffers for it.
You talk about growth, and growing "less than the US"
That may not seem like a problem today. What about in 20 years? If Germany finds itself considered a small or medium sized economy, having been outpaced by other economies that are then much larger?
If you don't see anyone struggling around you, then you live an insulated life, keeping away from people less fortunate than you.
Give it time, as Germany's economy shrinks or grows more slowly, you will see that the costs of the state are no longer met, and inflation chips away at the quality of life of the people. The top 10% will likely still do fine.
Though an economy should be judged by the quality of life of the bottom 30%, not the top 10%.
This is something that Germany forgot in it's vision for Europe.
Give it time.
I also suggest that you travel. The European viewpoint of Germany has soured significantly. As it has around the world.
@@BusesAreFatCars
- How did we contribute to causing the war in Ukraine?
- Yes, Merkel did that. And it was the correct decision. Giving a save shelter to refugees in just humane. If other european countries or other countries in the world or other germans are angry about that, then so be it, but i am proud if we can help out those in need. Same thing now with the Ukraine.
- The EU is not ruled by Germany. I'm not sure which exact policies you are talking about regarding energy or immigration.
@alexpavlov3535 Your sentence doesn't make sense.
Great fit with the sponsor. As a german I’m not optimistic the same parties that caused the mess will be in power soon again
Typical German comment. Always seeing everything negatively.
One thing we germans did not so well in recent history was scaling our industries. We were leaders in solar, are quite good in UV-chip manufacturing and really good in making IP for chip, thermo management etc.
And while our highly diversified landscape of companies is really good in "exporting companies", and it's no longer feasible to supply the entire world from germany and fullfill climate regulations, it would have been really helpfull to maintain some key technologies in germany.
What's really bright in germany right now is medical and space exploration. If you follow the corresponding scientific institutions, there are quite a view gems we will most likely export to the US/China, Turkey and Korea. But this argument really depends on a strong german government, that finds a way to end the war in the ukrain to solve our energy problem, and holds our ground against the USA and China while building good trade relations with both.
And it would be really benefitial for all of us if we could somehow get the capital of the world the US, to terms with the factory of the world China.
Danke!
i just recently discovered your channel. And I can't ignore, when i see well educated people doing great quality work, in this case, great quality content!!! Keep up the wonderful work!
Im German and your absolutely right. Great that you make optimistic content! Keep on rolling!
I like this guy. His answers are great--- short and to the point. I'm from the US, and the Native- Americans have a saying, (originating from when they were getting screwed over with worthless treaties full of legalese jargon, and rambling, flowery promises). They said, "It does not take many words to tell the truth."
German here. First of all, thank you for all the encouraging words since I am afraid of the near future of German and Europe. My main concern is that Europe has not a single toe in at least one door when it comes to all those "big future markets" (AI, computing hardware like GPU and CPU, Software and so on). Maybe I am just too negative, but in my opinion the only company might be ASML. All the other big players are either in the US or China. On top of that we got soooo much bureaucracy, which (at this point) costs more than it helps Germany & Europe. Again: Vielen Dank für das Video (thank you very much for your video)!
Well at least we don’t have a mad man like trump. Also I have seen numerous reports that the ai current worth might be a bubble meaning that it’s highly overpriced. If this bubble pops it will reach the entire world. But mainly the us. Also apple’s sales have slowed down in china greatly. I think we also need to realize that if more countries produce stuff (e.g china) that yea our sales will go down. But what I want to emphasize is that we as Europe should finally take Africa seriously and start investing money there. A lot of people there will need Audi’s etc
Toyota group produces over 10 million cars every single year, making it the largest automaker. They do this with roughly 370 thousand employees. Volkswagen group produces less cars, with 670 thousand employees, almost double. Seems kind of strange that there isn't more being done to improve productivity, especially if there's a so called "massive skills shortage".
Nobody cares about the number of cars manufactured (that was only a VW fetish for the tim being)
@@ToriZealot You missed the point: VW is inefficient.
The comparison is not 1 to 1 accurate. A lot of VW employees are working in dealerships and repair shops and not in manufacturing. Toyota has almost all repair facilities and dealerships outsourced to small local companies working for them.
Maybe because Germany values the stability of it's country and workforce and employment level, rather than just pure productivity.
Volkswagen was originally sponsored by Hitler, it became one of Germany's biggest employer.
It's a National name and not just some company.
Comparing just the employees without considering the structure of the company is useless!
I discovered this channel today and I love it. The videos are so clear and simply structured! Good arguments.
Very good video. A posotive view in these times is nice to have.
Mmmm - no mention of chronically high energy prices as far as the eye can see...
Which is, if not, the biggest problem for energy intensive industry...
Energy costs were always high in Germany. Ricght now, they are actually only average. Especially for industry.
Its always funny when john stevens are digging up bullshit they heard 20 years ago and committed to core memory. RN we have cheaper electricity than the Poles or the British and gas is back down to only slightly more expensive than 3 years ago. "Cheap russian gas" never meant free. It was like 10% cheaper max than norwegian or algerian or whatever.
@@meinnase
I am living in Germany (Bavaria), my energy bill for a family of 4, is high like Snoop Dog after a gig night, especially when I factor in the modern household that I live in! (When I say “expensive” I mean expensive compared to the median salaries.) I pay 80 Euros a month with all LED lighs, heat pump system and all AAA rated electronics in the house.
Since Germany is the 5th country I am living in, I think I have a good idea of how it compares to other countries:
Compared to Hungary, electricity is more expensive here.
Compared to Belgium, electricity is slightly more expensive here.
Compared to the US, prices are super expensive in Germany.
Compared to Romania, prices are more or less the same.
@@The1KovacsAttila1dann 80 Euros seem pretty cheap to me, I remember at the start of Covid I payed 110 for a two person flat, that did get adjusted down to 105 after a year but still
There isn't munch of a skilled workers shortage.
More a well paying jobs shortage.
Two things Germany really needs is investment into the public infrastructure - there are 4,000 bridges which need immediate repair within the next two years - and a switch from an export focused economy to a more diversified economy with more focus on consumption like the US has.
The latter however is kinda hard to achieve due to my first point abt the well paying jobs shortage and the first is rather hard to achieve because all our parties except for Greens and AFD (Idk the AFD's stance on this issue) are in favor of the "black zero" policy which means the government can't take on any debt (or only .35% of GDP as its enshrined in the constitution)
Afd will halt mehr liberalismus und weniger staat. Sind also sehrrrr nah wirtschaftspolitisch bei der fdp
It wouldn't be easy to repair the flaws +30 years of frivolous free market policies
@@toyotaprius79 "public infrastructure" is not owned by the private sector, the state and its institutions own the infrastructure. So blaming the free market for not fixing something they didnt even own in the first place is pretty stupid.
To be honest, at least the SPD and partially also the CDU are starting to see the need for a debt brake reform. You can only ignore experts for so long.
@@toyotaprius79 I agree but these are not the most prevailing problems. A return to real social market economy is however neccessary to secure long term growth. What I said above is neccessary to even get our country back on a growth trent
I recently graduated from TU Munich, so I can share some insights.
I have friends running startups here, and most startup founders are willing to move to the US because of the insane taxes, lack of VC and complex bureaucracy here.
+ Most of my talented local German peers are willing to move to Switzerland or the US (because of taxes and salaries)
+ Many skilled expats are also considering moving to other countries (same reasons as for locals), even if some of them have been here for 10+ years.
+ It is highly non-trivial to find a job after completing a Master's degree at TUM (can judge from the perspective of mechanical engineers, computer scientists and biologists).
For me, this is a clear indicator that I can't bet on Germany's economic prosperity in the coming decades.
so out of all countries in the world Switzerland and the USA seem more attractive to you. wow Germany is DOOMED (unlike the other 190+ countries which you supposedly would rank below Switzerland as well). In short: You're an idiot.
With a bachelor degree it might be tricky. But with a master in mechanical engineering, and some form of network you build with interships and thesis you should be able to find a view offers.
Especially infrastructure related companies like Siemens, DB, Herrenknecht, Liebherr need a lot of people. The only sector where companies seem to be afraid of employees is automotive.
High salaries and taxes wont make or brake your startup, unless you have to get cheaper than established competition. What really is tricky in germany is building all the helpfull connections to the fragmented landscape of businesses. In the US it's easier to get the necessary capital and connections, but they also own you and set your "toolbelt" you have to use. Switzerland is really interesting, because you are still in reach of the german landscape of companies, but it's more enabling. Like Belgium and Letland as well.
This is the best comment on this topic...straight to the point !
Thanks for that optimistic outlook after listening and reading currently to so much "all over sudden death" of our whole economy!
Would love a similar video on the economic state of France if it interests you !
Thanks for your work
UK can hold their hand on the way down.
Dramatic aren't you. Things are run down. It's happened before.
The UK will fall further than Germany.
@julianshepherd2038 there's nothing to indicate things will get better though. Quite the opposite actually.
@julianshepherd2038 I know. Was only joking.
UK has a habit of slapping away ANY helping hand, delusionally whining over the faded dominion over the rest of the world.
Excellent piece, I have been disappointed at how the slow down in Germany industrial production have been put as a big issue while in reality, when you sit back and look at the big picture, it is not a reason to panic.
Joeri, you've really laid out the best case scenario for Germany and that's to basically stave off collapse. A lot of things (domestically & internationally) would have to go right for this scenario to play out. I'm less sanguine (but not insane like Peter Zeihan).
Zeihan is always way too black and white.
The value of such positive data supported takes are incredibly important to change the public's mood (workers, investors, consumers). Particularly appreciate the honest warning at the end about the need to compare with other analysis as well possible scenarios taking place rendering this take inaccurate. Well done!
For those who also found the chapters naming to be obfuscated:
0:00 - Intro
0:39 - Germany's industry is resilient
4:32 - Profit from fragmentation
5:56 - Germany's democracy is working as it should
7:16 - Germany's demographic decline is manageable
9:19 - Germany's current problem is temporary
The trouble with the "democracy working as it should" is that while yes, governments can and do collapse, nearly all parties here share the same neoliberal austerity core that under Merkel brought us to this exact situation. We have an insanely high level of infrastructure investment deficit, which a resurging economy would need to be fixed, yet most parties - the CDU chief among them - will ensure that we will invest nothing into fixing their mistakes.
Problem is also that Parties willing to spend more, mostly want to spend in social Costs and subsidies, instead of infrastructure.Also Energy Market with the complete unnecessary shutdown of nuclear Power has seriously worsened the competitiveness of Germany under the CDU
@@abctutnichtweh1you have to invest in social costs. The problem is rather that we play one off against the other.
Social costs shrink when you invest in infrastructure, science and companies. Until then, you have to pay these costs, which stabilises demand and therefore companies.
It is also important regarding demographic issues. You need to keep the situations of families stable. Instability has an effect upon how children perform at school. And this has a long term effect to the workforce of the future.
@ThomasVWorm increased spending in jobless People and retirees wont improve infrastructure...........
@@abctutnichtweh1 it is always surprising that voices from the conservative sides are asking for fiscal cuts on the money that jobless people get, while conservatives also tend to be the most frightened of crime rates. But the less the poor have, the higher the crime rates will be. Simply restricting money to beneath what it takes for survival is not helping people to find a job, nor being the best incentive to do so.
Beyond that, the social spending can be seen as a subsidy, as the money directly gets spend for consumerism (and returns in tax form), while cutting taxes for the rich results in savings, not incrased spending.
Also i think it is very short sighted to simply blame the nuclear power exit, when other european nations have very much the same price level. The spike in energy cost some years ago has been solely due to the high dependence on russian gas and oil, which play only a little part in the german energy mix for electricity. At this point nuclear would be a lot more expensive than any other electricity form, while also being far from clean.
@@n9o you mistake me If you think iam "conservative". Iam simply stating an economic fact. Social payouts dont Change the structural disadvantages of Germany.
very well done! thanks
Most Europeans have been so comfy for the last 70 years that they confuse set backs with collapse.
My opinion exactly. Greeting from Austria 🎉
100%, especially in the West
As a greek living in western Europe, I agree
The rundown of economists in 2012 was that during the times of 2022-2028 the economic growth of germany will slow down or come to a halt due to redistribution of energy production.
This is broadly the fact as its happening rn.
HOWEVER the same economists also said that the cutting off of oil will free up ALOT of capital from 2028-2030 onwards, truely unleashing its economy.
Heres to hope
@@Alexander-z6xWhat does "cutting off of oil"even mean?
coming from a german automotive supplier industry that needed to be flexible and global from the beginning of the century. I see it the same way you descripe! Of course a goal of the economy every peak of change at the global market but the flexibility is strong to transform.
Thanks for the encouragement ❤❤❤
As a Nanotechnology Engineer, who is born and raised in Germany and studied here, I can't find a job for almost two years. I think that's enough to tell in case of "High Tech, Future Economy etc."
Sorry to hear brother. I hope you get a good job soon.
High Tech Niche Jobs are basically non existent in Germany. You think you would be an wanted person but nope nobody wants you because there is simply no demand. Why Germany even offers these Study courses is a mystery to me. Even the actually quite massive Movie Universities here are like for what exactly? German Cinema produces garbage that only boomer germans want to watch and all the talent is going to england or the usa. We train them but cant keep them. So stupid.
I am Iranian in Germany and what I see is a very stable system that keeps people in check (though things could be better) but when I see Germans complain about a possible collapse, I wish I could take them to Iran to show them what an ACTUAL weak economy and instability looks like.
Wir müssen uns beruhigen.
I think the reason might be two different comparisons.
#1 You compare the current german condition to Iran. -> sure we are far better off
#2 Germans compare the current german condition with the germany they know from the past. -> we are worse off
@@kisscola Yeah i guess i have different standards. I believe we should accept dangers but reject panic. in iran we are panicking since we rejected the dangers too long.
@@BlankRami sounds reasonable to me
@@kisscola #3 however: it's the same for everyone else aswell. So, we also need to put things into perspective. If you look closer, it's basically Marx again, we are in a fierce fight between classes.
If we were to actually tax the elite earners/owners of wealth in a truly socially "fair" way, these problems would be rather minuscle.
@@fj8264 I dont think that fair taxes have ever historically occurred. the rich have have too much lobbying power to ever let that happen.
I don't know about the argument for new factories moving out of the country when most of these new factories are becoming more and more automated, are we sure factories aren't moving out because of the sky high electricity cost and bad business climate, rather then skill shortage?
Why would VW open a new factory in the US and pay higher salaries, instead of staying in the Germany? Does the US really have that much bigger skilled labor pool?
And won't this as a result pull even more skilled German labor into the US with the higher salaries causing even further skilled labor shortage?
The US certainly has a healthier skilled labor pool. That said, I don’t think a skills shortage is the only reason (though it is a reason) that some industry is leaving Germany. Germany is a real awful place to be as a business, only really held up by the fact that Germany is wealthy and highly educated. The actual business part of business is awful though, everything is regulated to the point that you can’t really do your job properly.
@@isawrooka4 This guy also forget to mention, that all those feats were possible the world population was still growing, there was more and more demand. The landscape have changed, couples only own pets, and invest their money in stuck and other stuff. If everybody keep doing that we will head to the mother of all crashes.
@@isawrooka4 Yeah true, the skilled labor pool is healthier in the US, but how much of it is due to domestic vs immigrant skilled labor is what I was aiming for(though I didn't clarify).
A lot of the highly educated people were already moving from EU to the US and this will just further exacerbate the problem.
@@blazer6708buddy the US almost 4X the population of germany. The education system is good in germany, but there is no shortage of talent in America
@@robymaru03 youre acting like Germany was providing the entire world with machines etc. in the last decades. That is far from reality and many countries have opportunities to grow in the future, meaning they will need machines. If thats India, Indonesia, Mexico or parts of Eastern Europe taking over China's role as the world's factory or Africa's further economic development. Growth in the past decades was centered around China and the US, thats soured to a degree but doesnt mean there arent other options
Wow well explained. keep it up!!!
It's great to hear an optimistic forecast.
As a someone who moved from the Balkans to Germany in 2020. let me give you a reality check.
20 years ago, if you were to ask anyone in the Balkans should you live and work in Germany, the answer was a resounding YES! Today, that is no longer the case.
Rising living costs in Germany, with salaries that no longer match the conditions, have made Germany quite unappealing to almost everyone. I say almost, because the only people willing to try their luck here are the ones who are absolutely on the brink of poverty in their home countries. Those are not skilled workers that Germany needs.
I am a software developer, and even with bonuses offered to me for recruiting someone to come and work here, I cannot find anyone willing to come anymore. IT people earn similar wages elsewhere, with significantly lower living costs. In fact, I know more IT people that went back to the Balkans, then people who came here in the last couple of years.
Unfortunately, the future doesn't look that bright for Germany with it's current course.
Bro, everybody knows it is fucked, but that is not at all indicative of the larger economy where people actually tend to do shit that produces value
Ursula said “why Europe doesn't import CHEAPER natural gas from the US?"
Then what county is best for people in tech related jobs.
@@Ariyan_1709 hell
Thank you! Skilled workers LEAVE Germany since decades (150.000 per year), millions of completely unskilled and mostly not motivated immigrants produce only costs but no profit for the German economy. To assume, that Germany has a bright future just because of fertile immigrants is completely reality-denying. People who want to work, LEAVE Germany. People who don‘t want to work, come to Germany. That‘s the reality.
Your video really remind me of the dog meme with the house on fire "THIS IS FINE", as an economist you should know this golden rule that “Past performance is not indicative of future results”, things are really different this time around just like a young kid can easily recover from a big fall and some broken bone, for an elderly it could take him to the grave, an aging population complicate everything for any economy.
elderly - meh. brown and black - 100%.
Been hearing that for a few decades, meanwhile Germany keeps going. It just past Japan’s economy in size, with a lot fewer people.
Love the new format, keep up the good work.
Germany is the only big country which didn't take on new loans to combat the international economic crisis. The growth of a lot of the other nations was solely due to new loans and massive investments into the economy. We can't do that here in Germany due to our constitutional debt-brake.
You are not as good as you think when you are on top, and you are not as bad as you think when you are down. And this also applies for countries. Great video!
There are already enough graduates and juniors with a few years of experience in STEM fields from German universities. But they are struggling to land a job (even being ready with 35K Euro/ year brutto ) as companies are not ready to hire freshers or juniors. Instead of outcrying about the skill shortage for more than 5 years, companies must leverage these graduates, train them, and within a few years, they will be skilled enough to generate revenues. Eventually, these skill shortages can be minimized. At the same time, the Rathaus must improve their visa-issuing processes to avoid unwanted waiting periods.
If you analyze more, the Kelin and Mittelstand companies rely heavily on projects from big companies. The downfall of one big corporation has a ripple effect on these middle and small companies as well. Still, I hope this phase shall pass like the past wars and recessions.
About sponsor: How funny it is, I was expecting ground news but never The Economist. And the brand reputation really helps, I hope the Economist sponsor more projects on this channel.
more nonsense, who needs that?
If you live in Germany, your financial situation might paint a different picture. Germany has some of the highest energy costs in the world, driving up the price of nearly everything.
The country's wealth has long been built on its powerful automotive industry, with every sixth job tied to this sector. However, two key pillars supporting Germany’s economy are faltering. Affordable energy from Russia, crucial for its manufacturing-based economy, is no longer available. At the same time, the Chinese automotive market-a vital export destination for German car manufacturers-is in decline. In other words, two major foundations of Germany’s economic strength have either collapsed or are on the verge of doing so.
The cost of living in Germany rises year after year, leading to growing dissatisfaction among the population. This has fueled the rise of right-wing parties, which gain traction by offering simplistic solutions. While these solutions may lack logic or sustainability, history has shown their appeal in times of crisis. Both World War I and World War II demonstrated how economic hardship, such as inflation and mass unemployment, can pave the way for radical ideologies to take hold. It’s worth remembering that Hitler rose to power during a period of significant inflation and with six million unemployed people in Germany.
In times like these, optimism can feel like a scarce commodity in Germany.
Here is Hitler’s (Hiller) real genealogy:
mileswmathis.com/putsch.pdf
pretty lack luster analysis imo:
"the Chinese car market is in decline" - it isn't, what's in decline is demand for German cars as they are now far behind their competition technologically, are usually more expensive and their EVs have all come out later, that is solely the German corporate leaders' fault, they ignored Tesla and the electric market shift as a whole for way too long
"most expensive energy" - Germany semi-privatized its energy sector in the early 2000s, energy production, transport and trade are now all run on a for profit basis, this obviously creates an incentive to make money which drives up prices, corporations saw this coming but did nothing, same for the conservative/neoliberal government, instead of huge investment into the infrastructure and electrification of industrial processes they went for (short term) cheap russian gas dependency and gave the industry an easy way out, german automakers returned record dividends for a decade but invested little to nothing in meaningful transition of their manufacturing processes - economists, allies and politicians warned about this for years - also: absolute cost is high but relative cost is lower than in some other OECD nations - phasing out nuclear before coal and not putting heavy invest into renewables didn't help
all in all Germany pretty much fucked itself through incompetent political lead, given the decline of Britain and the trade war the US started with China it would have been a big chance for Germany to step up and profit from that but they didn't, instead were and still are busy cleaning up the wrong doings of the past 20 years
my opinion
@@benzo___ I totally agree with you!
I said "the Chinese automotive market-a vital export destination for German car manufacturers-is in decline" and I meant exactly that what you wrote.
More details are coming out. German managers did not invest in future technologies or sold it to china, to get a bigger bonus and to keep the share values high. Without Mercedes there would be no Tesla.
I do not see a solution how Germany can fix this mess, but it will cost blood. It already does.
Your description is overwhelming positive.
Thank you for this video and the evidence-based comparison to other economies. I am a german engineering student and I don't understand why the majority of people in Germany are always so worried about the future and over-sensationalize every piece of unpredictability. We have many of the biggest tech-companies in our country and still have lots of smart people around. What we now have to see is a decline in bureaucracy and the trust in innovation. We are good and and hard-working people.
Never really understood the gloom and doom for German economy. Maybe a downturn while reconfiguring its economy, but there is no lack of capital or talent in the country.
Bad news sell exceptionally well in Germany
How should German economy recover whithout cheap energy, raw materials or cheap labour? Indeed it will not. Please stop buying nonsense
Energy prices have gone down quite a bit already and why should rawmaterials suddenly be a problem?@@ToriZealot
@@ToriZealot Energy prices are back to pre pandemic levels. In fact adjusted to inflation they are LOWER. Germany always wasn't able to match energy prices of the US. This is nothing new.
@@IsomerSoma The world is changing and Germany is loosing global market shares for years. There are multiple problems. I do not see that any problem is taken care of.
Germany's current biggest problem is the lack of investment by the public sector. This makes it harder for the industry to get back up to speed, it makes it more difficult to increase productivity, it makes it more difficult to overcome infrastructural and energy problems. So, I like this analysis and I am so frustrated that so many Germans still believe in the "Schuldenbremse".
It may be asked why the public sector is not interested? Is it not because of the very high production costs?
@araara4746 The public sector is investment by public sources, so the federal government, the states, and the cities, including their various institutions. On the federal level, there is the possibility of spending more, but it restricts itself, mostly due to ideological positions that think that public debt is a problem - empirically it is not actually a problem per se but that's a different debate. States are already very restricted in their household law, which is tricky for them to change without federal support. Lastly, cities are most important for investment in public infrastructure, as they build most roads, most water utilities, schools, etc. However, while they have huge responsibility, they are also the most restricted financially. So the only player with sufficient financial capabilities (the federal level) does not want to pay more and the other 2 levels are not able to pay more. As a result, Germany is behind on internet, the train tracks are outdated, the schools are outdated, the universities are understaffed, the cities are dirtier, the health insurance and social insurance becomes more expensive, and more... People feel that and they are disappointed by their cities, states, and federal government. More and more are voting for radical parties now, which will only make things worse. That's what happens if the public sector invests too little.
For the private sector the costs of production are more relevant. Generally, Germany can counterbalance the high costs with very high productivity. However, lower electricity prices would help for sure - which could be achieved with more public investments. Also, public investment usually increases private investment, as it reduces risk for private investments and increases demand for businesses. That's the good thing about public debt, which many politicians don't want to see. Public debt is good for the private sector.
@@araara4746 it is simply put lack of political will - Germany's debt ratio is around 65%, the US sits as 125%, if Germany was to increase its debt ratio to just 100% that would mean 35% of the GDP or around 1500 billion € could be invested as infrastructure spending, be put into the economy as stimulus or used in other ways to boost GDP and investment, this would also slightly devalue the € which in turn makes it more attractive for other markets to import European goods because of more favorable exchange rates
Germany's machinery sector should not be understated, and the US and China cannot maintain a competitive edge against the machinery produced by German, Swiss, and Dutch companies. ASML is just the tip of the iceberg, there is an entire supply chain located within Germany, Belgium, and the Netherlands which the entire world depends on.
This. So much this. Yes, a lot of our "Mittelstand" is HIGHLY specialized in these, but we are still and will keep being for the forseeable future - the people who create the machines who enable to produce the stuff people want to buy cheaply. Oh, and overprized and overengineered same-ish products nobody but wealthy people can afford these days.
i am living in DACH area and work companies that area. this video is so much optimistic.
This is a phantastic win-win situation: this YT channel and that Economist selling: typically an economist! 😄
I don't think german economy will collapse but it might transition from manufacturing to service based. As the world moves more towards solar energy, near equator and southern countries would have much cheaper energy cost than northern countries.
Yeah a nation of cleaners and hair dressers. What a great future.
That will be even worse for the country. German service is terrible.
@@jagolago-bob I disagree on that one. People are always friendly in the shops in the region where I live. There are others, where this isn't the case, though. Service in large cities seems to be less friendly, people are more in stress there.
ah, people who don't understand how energy systems work. how cute.
Let's just say that wind and solar don't deliver what we need them to, and leave it at that.
The functioning and demands of our energy grids is an interesting and critically important rabitthole to dig into a little bit if you want to understand in particular Europe's trajectory in the coming years.
@@quinto190I think the people in the shops are ultra unfriendly but direct
Disgusting
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Not sure about your evaluation of the german government. I think it was much better then its reputation. I also think that the future of Germany is much better than this news cycle will tell you :)
It was. It had to face many strong crisises. You look bad even when you perform good, since the people do not like the situation.
Esp. the loss of the supply of gas could have caused much bigger problems. We never had a breakdown of electricity.
@@ThomasVWormthats Not because the current Gouvernements l, but previous Administrations....... Energy Security has decreased significantly since 2016
I agree. There have been many problems with the Ampel, but all in all it has been a rather good government. Most of the media bashing was unjustified. It had had developed into a sport of some sorts. Though, I am not so sure about the bright future part. I REALLLY don't want Fotzenfritz Merz as Chancellor.
I love your different perspectives!
Vielen Dank für die fundierte Übersicht!
No word about the hight price of energy, about the competitive chinese machiary industry, nor to the access to the before profitables and wasted chinese and russian markets.
Only a vatnik believes living under the Russian heel due to cheap energy is sustainable. Germany have had their chance at cheap energy, but they decided on burning coal and getting fed by authoritarian states and selling their souls at the same time.
Energy prices are down and electrification is picking up steam. Also check out all the planned electrical storage projects in the country. We are on our way to show the World what a modern electrical grid looks like
ngl seeing this straight up makes me doubt it. Just because it was resilient before it doesn't mean it will, just like those youtubers saying China will collapse and here it is still
It *is* collapsing. Quite literally.
@@KiffgrasConnaisseur collapsing to a superpower
Right , past challenges mean nothing if the new challenges are shrinking market because of a competition from newly emerging China , aging demography lack of access to cheap energy and so on .
The answer to the question in the headline is always “No”.
Thank you for a succinct and seemingly well-researched analysis :)
A bit of grounded optimism is exactly what is needed - to counter the typically more negative attitudes that can come to the fore for Germans 😅
Also hope the next government watches this!
Keep up the good work!
I appreciate a sane, level headed analysis from the channel as always, thank you 😊
Germany has faced serious economic crises in the past, but has often been able to emerge from these crises with strong reforms and continue to grow. While the current challenges are deep, past experiences show that Germany has the capacity to overcome these difficulties
Hi, I really like your videos, no nonsense and well researched and also referenced.
I do not have a degree in economics, only 'general university level educated', so some things sound very simplified to me, but maybe they are fine in the economic discourse.
Good example is in this video, you say it would be better (or at least not a big loss) if a company moves production away from Germany, given that the country lacks skilled workers, and the company moving frees up some workers.
But a) is it so easy to assimilate skilled workers elsewhere? Skills might be very specific to a company's production. And they might have to move far away, maybe they don't do that, or it is a very slow process.
b) Isn't it simplified to look at a country as a very homogenous entity? A region in germany probably is fairly independent, and if, say, all industry abandons the south, maybe the south ends up very poor. And a while the country might not worry too much about that, the region should maybe fight tooth and nail to retain its industry.
Again thanks for good content. :)
You cannot make a comprehensive prediction about Germany's future, even just economically, without even mentioning the elephant in the room. Most people living here are starting to develop a pretty clear picture of where this is going, and let's just put it like this: All the issues analyzed in this video (as correct as the analyses may be), are symptoms of a much larger problem. Take a stroll through a western german city and ask yourself: "How much of this is going to be improved by having some more startup companies and innovation?". Also, all of the diagrams concerning population might be numerically correct but at least highly misleading: The amount of actual wealth and properity created on average by a million people in Germany in 20 years is going to be a tiny fraction of what it was 10 years ago or even today.
You are implying something and I don't know what it is. What is the "clear picture" that "most people living here" develop? Can you elaborate?
@@makeplay8004 He hates brown people
@@makeplay8004 Sure. I'm going to take myself as an example. Despite all the economic problems mentioned in the video, I don't think I have to worry about my job or the money I make and most people around me seem to view this simiarly (we work in STEM). With my first child on the way, I just have to compare the childhood they would have here to the one I had 30 years ago to get the "clear picture" I was speaking about. Everywhere I look, the system leeches off the working population more than ever before, despite delivering much worse outcomes than ever before. The education system is cooked, having never recovered from the 2015 migrant crisis, then Covid and Ukraine happened on top of that. Public health system is broken, we end up paying doctors out of pocket in order to not have to wait months for an appointment (after paying a grand or so a month for the health insurance). The infrastructure is broken, public transport is a joke and our "Autobahns" are in terrible condition, bridges literally broken down, leading to much longer travel times per kilometer than in our neighboring countries. The city I grew up in is basically irrecognizable, shops closed down, garbage everywhere, violent crime rampant.
I could go on. The point I was trying to make is that if any of these problems were downstream of economical issues, they'd already be fixed and many people understand this by now. Everyone I know makes enough money and yet everyone is talking about leaving.
@@makeplay8004 I replied but it got deleted. Interesting.
You're applying there is an elephant in the room. What is that elephant? Also, I agree with you. I feel like this video is poorly researched. Feels more like a piece of propaganda to drive stock price up
I would be really interested in your take on 1) the Russian economy , since everyone is talking about its downfall, and yet it is still standing; 2) the Milei government in Argentina, since it’s been a year and I heard contradicting reports (stabilisation of inflation vs explosion of poverty). Thank you for your work ❤
Hey, I only watched two of your videos so far and I can firmly say you're the only optimistic German I've ever met. 😅 Btw, you forgot to mention the energy prices.
I disagree with a few of these points:
1. The industry is well diversified, but all industry consumes energy. Germany industry used to rely on cheap Russian gas, but now with that out of the picture for the foreseeable future, all German industries are going to suffer to a smaller or greater extent. The construction is sturdy, but the foundation is beginning to crack.
3. Democracy is like an elastic band: the good ones can be pulled a lot for many times, but it only needs to break once before you need a new one.
4. Not all immigrants are created equal and immigration isn't a "get out of population decline free card", it's a trade-off. Are the immigrants currently coming to Germany going to fill the skill gaps in the economy, and what are the opportunities and challenges that they bring? I believe Denmark had an interesting study on this. Japan and South Korea have very low immigration levels, while Canada and Sweden have very high immigration levels, and they're all struggling in their own ways. There's a lot of talk about economic and environmental sustainability but not a lot of talk about societal / population sustainability.
Past performance may not represent future gains...
Only under the efficient market hypothesis, which you can argue is more true for the stock market, but cannot be more wrong for labor market or the general economy
I'm not so sure that the next government will be better. If FDP manages to stay in parliament and is the chosen partner for the Union we are fucked because there will be 0 investment.
I like your ensuring positivity, so rare in this kind of topic videos.
Thank you for taking the optimistic stance in the midst of a lot of negativity.
Germany is for sure going down the river, there aren't enough young people, a lot of unqualified foreigners. The taxes are stellar high and salaries low. Germany exports a lot of goods because the salaries are very competitive (low compared to the high efficiency). There is a sort of crazy federal law, which forbids the government to borrow the money to invest in the infrastructure and education. All state agencies are underfinanced. I earn 7K brutto and receive only like 4K neto. Small apartment in a big city costs like 1.5-2K Euro etc. I can hardly imagine how the life with an average salary and children might look like.
Unless you live in Munich you don’t pay that for a small apartment. We live in a nice 65sqm apt in a pricier city in NRW and pay 1000€ warm. Contract is only 3 years old, so it is not an old contract either. We considered moving to a slightly bigger apartment and found that 80sqm with 3 rooms would be 1200ish per month warm.
Maybe look for an apartment that isn't located in the most popular cities?
@@isawrooka4 Munich, Hamburg, Berlin, Stuttgart usw.
@@stygian4011 Sure I could move to Bulgaria and do the home office from there
Frankfurt 1000 euros warm mite normal salary 2000 neto plus 200 groceries and other stuff at the end you have like 500 euros for myself if i had kids i would be in debt😢
Unlike all the other countries you mentioned, you personalized references to the US. Trump is not a rogue factor, but the will of the people. Say the US wants this or that, not an unfavored individual.
Most rich people stay rich by spending like the poor and investing without stopping then most poor people stay poor by spending like the rich yet not investing like the rich but impressing them. People prefer to spend money on liabilities,, Rather than investing in assets and be very profitable.
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I work in the chemical industry, one of germanys industrial backbones besides steel/automotive. Most people nowadays want to work for the state in the public sector because it provides Jobs that are literally guaranteed to exist. There is no incentive for young people to work in industry besides some mayor mayor industry Leaders like Carl Zeiss, Siemens or Bosch. Most people prefer low paying public Jobs with benefits like Home Office etc. They really need to innovated the tax System to Support people that want to work a lot to get germany back on track. Besides that the legal side of making Business in germany is such a nightmare that many companies prefer states like poland over germany but not for their cheaper workers.
All I see is discounted market, which will be dominant again
If they don't have people to work how will it be dominant again?
@@chrisgeyer4002"no people" - we have 83 million and rising. Additionally, robots and incresingly ai have already made the average German worker way more productive than in the past.
@Marvin-ii7bh your population is only rising due to migration much of which is unskilled and contributes nothing economically and actually is a leach on the economy. Your native population particularly the working age population will be growing smaller and smaller as each year passes. AI can help a little bit it's not going to be enough when your working population shrinks by a third over the next 20 years. Germany will be as poor as a Latin American country by the second half of the century baring a miracle.
@@chrisgeyer4002 😂Mexico's GDP per capita in 2050 is predicted to be $42,000. So over the next 26 years, you expect the German economy, not even to have 0 growth. But to decline by 0.87% a year. That is degeneracy and will never happen. Cope.
@Charlie43348 You cleary are clueless and naive to how bad an aged population with no young people of working age will be for your economy😂true cope.
Good luck 💀💀
Well explained.. I'm quite confident that Germany will succeed as always.
..indeed the EU as a whole is far more resilient as many people think 😉
"Germany is going to get a new, more competent goverment soon"
laughs in csu / cdu
Very interesting perspective
I live here, I'm not nearly as optimistic. Everyone has stopped hiring, our old ass government is clinging to outdated technology and subsidising them at high cost whilst not investing in R&D nearly enough. The "skills issue" is bs. There's plenty of skilled workers that can't find work that remotely befits their skill. Plus were full of old people who will soon elect the oldest man in history to be chancellor who will make things even worse.
I don't mean to be harsh and I agree with you on the fact that Germany's economy is really resilient, but the part about Germany's democracy working as it should is so stupid.
Yes, the institutions are working, but the government didn't collapse because of public pressure, it collapsed because the libertarian party purposefully sabotaged the coalition. And the public pressure was mostly a product of right wing media outlets trashing the kind of left leaning government.
If you look at the facts about the Scholz government, they had to deal with multiple global crises at once and had to make up for the lack of investments into public infrastructure during Merkel. Yet, they still managed to reform social security, lower the cost of public transportation and get renewable energy production to an all time high. They were doing so well that the media had to focus on migration as a problem again to spread fear and hate in the population.
Don't know, I would never migrate to Germany, salaries are lower for Engineering positions and taxes are crazy high. Myself and other engineers would love to move to the US for salaries way higher than here in Mexico, but surprisingly engineering salaries in Germany are almost equal than here, and actually lower in places like Spanish. Europe is in frank decline.
Please don't come stay in your narco state.
Salaries are also determined by supply/demand. Lower salaries doesn't necessarily mean 'Europe is in decline', it can mean that there are enough engineers in Germany such that competition occurs between job seekers rather than employers, hence employers can offer lower salaries and still maintain a full workforce; likewise, in places like USA, Mexico, and.. 'Spanish'? Spain?, they may have Engineer shortages, which pushes competition between employers rather than job seekers, hence much higher salaries offered because job seekers have more choice on where they'd rather work.
And that's just one potential consideration, there are probably many, many more factors to consider before jumping to "decline" drums. If Germany is declining because of demographics, then every country in the world is basically in that boat except those of Africa and some other pockets in the middle east and Asia.
Well...but we have free education, affordable healthcare, better quality food at lower praises. 20-30 vacation days (sick days are apart of them), and it is not exactly expected workers to make long hours at work just because. I think Europe is still pretty much fine.
Coming from a Mexican desperate to enter the US... Lol. German salaries equal to Mexican ones and lower than Spain?? What drugs have you been sniffing
The US also has much higher costs of living there. Ok, Germany also has some expensive cities (Munich).
Thank you for your video, here in germany it is all doom and gloom. Your perspective was one i didn´t thought about, especially with those arguments. Refreshing to see a positive outlook. Reality is proably somewhere in between. I just hope our politicians get their act together (soon).
Danke für das Video und den economist Code
I‘m a German myself working in banking and finance and I absolutely do not share your opinion.
That was a lot of Copium. Here's a tip pretty much every Western country is complaining about a "skills shortage" its not a sign of a booming economy its just businesses wanting skilled workers for low pay and having a tantrum when it doesnt happen. Its probably more a sign of low productivity growth.
Alright, german economist here. No the economy is absolutely not fine. What we are seeing is the tip off the iceberg. The layoffs are worse than in the 2008 crisis. Consumtion has been down the drain for a few years. No consmption, no sales, declining production and so on and so on. Typical deflationary spiral while at the same time having inflation due to money printing. It a complete and utter disaster.
Und ihr werdet wieder die cdu wählen die sämtliche probleme verursacht hat....nicht das die ampel besser wäre
Also most complex economy and diversified: Most stuff is made for cars (including colors, chemicals etc) lol
I am a sympathetic Brit. How do think things can improve?
"Having inflation due to money printing" yeah, you are not a real economist
Printing money is literally a myth that doesn't lead to inflation. If you believe in monetarism, it's no surprise that your analysis contradicts itself. There is a lack of investment in Germany - I think we can both agree on that. There is also a lack of consumption. And what could change that? More investment by the state to increase investment in private sector and increase consumption.
I think many Germans don’t fully grasp the beauty and the seriousness of what I believe is a very accurate observation. The video essentially argues that companies unable to offer competitive wages will lose their foothold in Germany and eventually relocate their production sites. This isn’t necessarily bad news, as it allows employees to transition to growing industries or companies.
In Germany, there are regions where finding workers is nearly impossible, and others where talent exists but wages or working conditions are poor. This situation requires people to be flexible, not just in switching industries but potentially in relocating to new cities.
For me, the real issue in Germany lies in the lack of flexibility among workers. Many are unwilling to restart or adapt to change, which creates a significant obstacle. Additionally, there’s hesitation to create a more welcoming environment for talent, even from other European countries.
As long as flexibility improves-likely driven by economic downturns-I don’t see this as a long-term problem. However, the current lack of adaptability remains a key challenge.
I agree. Germany has problems that can and will be fixed. We did so in the past, and of course we will do so in the future. We have some difficulties right now, but we are already working on solutions and will be on track again soon.😊
I'm surprised you didn't address the likelihood of anti-immigration parties winning the next election. That would have a big effect on the future population growth if they get more hawkish on people coming into the country
People would be less hawkish if you just stop unproductive people from coming to the country.
It's because Germany is a coalition country. They are at 18% in the polls. They will surely win in that they will do much better than before. But, I doubt they will be allowed to join a coalition to actually govern. We'll see.
With an aging population that will be "interesting"
@@MoneyMacrobeing back the wall
Migration has done nothing but exacerbate their economic woes on top of creating social unrest and exponentially more violent crime.