Economic forecasts for Baden-Württemberg 2021 - 2025

Second quarter of 2025: Economic recovery - but with risks

The economy in Baden-Württemberg could return to moderate growth despite high geopolitical risks. The latest nowcast from the Institute for Applied Economic Research (IAW) and the University of Hohenheim predicts real growth in gross domestic product (GDP) of 0.5% for the second quarter. Positive growth of a similar magnitude is also forecast for the two subsequent quarters.

Quarter-on-quarter rates of change in GDP, 2023-2025

^{© IAW and University of Hohenheim 2025. Data sources: 2023q1 to 2025q1: Ministry of Economy, Labour and Tourism; 2025q2 to 2025q4: IAW and University of Hohenheim, own calculations. The data are adjusted for price, seasonal and working-day effects.}

The term nowcasting means that this is the GDP forecast for the current quarter, for which the official calculation will not be published until the following quarter.

Long-term development of real GDP

The following chart shows the development of the level of real GDP over the last ten years. In this period, the most striking development is the special impact of the coronavirus pandemic on GDP growth in the second quarter of 2020 and the counter-movement in the two subsequent quarters. From the beginning of 2022 until the fall of 2024, value added in Baden-Württemberg remained at a largely constant level. The plateau visible in the chart shows that this has significantly slowed down the long-term development of GDP. The current forecast values indicate a positive growth path, but must also be assessed with caution due to the uncertainty surrounding the geopolitical situation.

GDP level in Baden-Württemberg, 2016-2025

© IAW und Universität Hohenheim 2025. Data sources: 2016q1 to 2025q1: Statistical Office and Ministry of Economy, Labour and Tourism Baden-Württemberg; 20252 to 2025q4: IAW and University of Hohenheim; eigene Berechnungen. The data are adjusted for price, seasonal and working-day effects.

The three-year period of economic recession and weakness visible on the right-hand side of Figure 2, including the forecast period, has had a profound impact on Baden-Württemberg's GDP. The long-term development of growth rates implies that the economy has not grown in terms of GDP compared to the end of 2017.

Baden-Württemberg compared with the national level

At the beginning of 2024, the economy in Baden-Württemberg experienced a sharper economic decline than Germany as a whole, although growth in the subsequent quarters was slightly above the overall German figures (see figure). For the future development, the GDP forecast of the IAW and the University of Hohenheim for Baden-Württemberg is compared with the ifo's nowcast and forecast values published on June 6, 2025 (ifoCAST 2025) and with the nowcast of the Federal Ministry for Economic Affairs and Energy of May 9, 2025 (BMWE 2025) for Germany as a whole. The forecast of the Joint Economic Forecast Project Group dated April 10, 2025 is included in the comparison as a further reference value.

Quarterly GDP growth rates: Comparison with the federal level

^{© IAW and University of Hohenheim 2025. Data sources for Baden-Württemberg: 2023q1 to 2025q1: Ministry of Economics, Labour and Tourism; 2025q2 to 2025q3 IAW and University of Hohenheim, own calculations. Data sources for the federal level: 2023q1 to 2025q1: Federal Statistical Office; 2025q2 to 2025q3: ifoCAST, Joint Economic Forecast 2025 Project Group, BMWK 2025. All data are price, seasonally and working-day adjusted, seasonal adjustment of national accounts values according to X13 JDemetra+.}

The comparative analysis shows that the forecast growth in Baden-Württemberg is higher in the second quarter than at a national level. In the third quarter of 2025, the IAW-Hohenheim forecast is again within the range of the forecasts considered for Germany as a whole. Once again, the uncertainty of the forecasts must be emphasized at this point.

Forecast for the 2nd quarter 2025 (in German)

Forecast for the 1st quarter 2025 (in German)

Forecast for the 4th quarter 2024 (in German)

Forecast for the 3rd quarter 2024 (in German)

Forecast for the 2nd quarter 2024 (in German)

Forecast for the 1st quarter 2024 (in German)

Forecast for the 4th quarter 2023 (in German)

Forecast for the 3rd quarter 2023 (in German)

Forecast for the 2nd quarter 2023 (in German)

Forecast for the 1st quarter 2023 (in German)

Forecast for the 4th quarter 2022 (in German)

Forecast for the 3rd quarter 2022 (in German)