As a result of the weak growth of the official economy and increasing unemployment, the shadow economy in Germany will continue to rise in 2025. The avoidance of cold progression and the relatively small increase in the minimum wage counteract this trend, but can only slow it down slightly. According to the forecast, the size of the shadow economy will increase in nominal terms to 511 billion euros, which is an increase of 6.1 % compared to the previous year. Adjusted for prices, the increase is 3.8 %. The ratio of the forecast shadow economy to measured gross domestic product (GDP) will increase to 11.5 per cent.
Even at the end of 2024, Baden-Württemberg's economy will not be able to break out of stagnation. This is the conclusion of the latest Nowcast from the Institute for Applied Economic Research (IAW) and the University of Hohenheim. In the fourth quarter of 2024, gross domestic product (GDP) in Baden-Württemberg - adjusted for seasonal and working-day effects - rose slightly by 0.2%. However, this small increase cannot make up for the negative development in the previous quarters far from making up for the negative development in previous quarters.
Company training in Baden-Württemberg back to pre-Covid 19 pandemic levels.
In the first half of 2023, the proportion of companies in Baden-Württemberg that were active in further training increased significantly from 48% to 56% compared to the previous year. All forms of continuing education recorded an increase. This growth was particularly strong in self-directed learning. This form of further training is used most in companies with 500 or more employees. However, there has also been an increase of around 30 percentage points in small and micro companies in the country since 2019.
The study also shows that people with a low level of qualification continue to participate less frequently in further training measures than those with higher qualifications. In addition, the continuing education rate for women remains higher than that of men.
The report (in German)was commissioned by the Ministry of Economic Affairs, Labor and Tourism and is based on data from the IAB Establishment Panel.
A master plan for SMEs in Baden-Württemberg.
On behalf of the Ministry of Economic Affairs, Labour and Tourism, a scientific consortium consisting of the Centre for European Economic Research Mannheim (ZEW), the Institute for Applied Economic Research Tübingen (IAW) and the Institute for SME Research Mannheim (ifm) has developed a master plan for SMEs in Baden-Württemberg in order to strengthen SMEs as the heart and backbone of Baden-Württemberg's economy. The report analyses the strengths and weaknesses of SMEs and recommends a comprehensive three-stage action programme based on 1. urgency, 2. broad impact and 3. transformation management.
The press release from the Ministry of Economic Affairs, Labour and Tourism (in German) is availablehere.
Large labour force potential is not being used.
Germany is sitting on a veritable treasure trove of untapped labour potential. The greatest lever for releasing this potential lies in increasing the number of working hours per capita and not in increasing the number of people in employment. There are still large reserves in the labour force participation of the over 50 to 70-year-olds and immigrants living in Germany. There is also a great deal of potential among women working part-time without children to look after. This was determined by the Institute for Applied Economic Research (IAW) on behalf of the Family Business Foundation in a simulation calculation.
Gross domestic product (GDP) continued to decline in Baden-Württemberg in the third quarter of 2024. According to the latest nowcast from the Institute for Applied Economic Research (IAW) and the University of Hohenheim, GDP - adjusted for seasonal and working day effects - fell by 0.2% in the third quarter of 2024 compared to the second quarter. If the results of the nowcast are confirmed, this would be the fifth quarter in a row with negative economic growth. No fundamental change in the trend is discernible for the two subsequent quarters either.
