Enlarge image

Empty pedestrian zone in Bielefeld in 2021: 16 instead of 10 percent of income saved during the pandemic

Photo: Friso Gentsch/dpa

The crises of recent years have cost the German economy dearly.

According to a current study by the employer-related Institute of the German Economy in Cologne (IW), the lack of consumption in particular led to high economic losses.

During the period marked by Corona and wars, Germans spent 400 billion euros less on consumer goods than expected - that's around 4,800 euros per person.

Between 2020 and 2021, the pandemic made spending money much more difficult, and shopping or leisure activities were sometimes not possible at all.

According to the calculations, Germans spent almost 250 billion euros less on their consumption during this period alone - and instead saved a lot of money.

Less prepared for challenges

While consumers were able to put aside an average of around ten percent of their income before the pandemic, the figure was an average of 16 percent during the pandemic.

Companies also spent significantly less between the beginning of 2020 and the end of 2023.

According to IW, the investment losses over the past four years amount to 155 billion euros.

The German economy is missing a total of 545 billion euros.

However, if less is spent and invested, the economy suffers.

In addition, the German economy is an important exporter of capital goods such as new machines and systems - and there was also less demand internationally because of the crises.

In addition, energy-intensive industries are strongly represented in this country and are particularly sensitive to rising energy costs.

Economists are concerned about the lack of investment.

IW researcher Michael Grömling warns: "The lack of investment in the long term reduces our ability to deal with challenges such as digitalization, a shortage of skilled workers or climate change."

Weak consumption and a lack of investment are not the only things currently facing economic problems.

Read here: The economy is weakening, concerns are growing, this is what Germany's economy is really doing.

Apr