Location: Growth in productivity in Germany has collapsed - wealth maintenance would have to be multiplied by five
A new study shows that the productivity of the German economy is hardly growing anymore. If this continues, prosperity will erode - unless Germany implements reforms like those in five other countries.
A study by the Institute of the German Economy (IW) has found that Germany's productivity growth has slowed significantly, with an average annual increase of only 0.3% over the past six years. This is not enough to maintain the country's wealth, particularly with an ageing population and shrinking workforce. To catch up with other OECD countries, Germany needs to boost productivity growth to 1.6% per year, which could be achieved by improving in five areas: digitalization, artificial intelligence, innovation, reducing bureaucracy, and increasing investments.
By taking steps such as increasing research spending to Israel's level, Germany could potentially increase productivity by 13% and boost household incomes by €21,000 per year.
Written by urgent.news from Handelsblatt's report — not a translation of it. Machine-written — may contain errors; check the original before relying on it.
