“You go into the starting holes”

According to experts, the German economy will grow vigorously in the summer – unless there is a “yo-yo effect” in the fight against the pandemic. The emergency brake alone is not enough.

The upswing in China and America is stimulating the German industrial economy.

DThanks to the strong demand from the United States and China for German industrial products, the economy in Germany is holding up well despite the ongoing corona lockdown. While the service industry continues to suffer, the industry is currently booming, as it was before the Corona crisis. Economists from leading economic and financial organizations assume that the economy will continue to be divided into two parts until the end of the lockdown measures, according to a survey by the German Press Agency.

Once the pandemic is under control, there could even be a real boom. “We expect a strong recovery in the second quarter. Foreign demand, especially from China and the USA, is already driving the positive development in the industry and is developing very positively, ”said Veronika Grimm.

“In the USA, retail sales went up by almost ten percent after the reopening,” said Katharina Utermöhl from the Allianz Group. There are also the first signs of a spring recovery in the German service sector. “You are in the starting blocks,” said Utermöhl in view of the first signs of new hires even in the catering industry.

“Qualification is the most promising way”

“In the next few months it will be important to set the course for a successful upswing,” said Fritzi Köhler-Geib, chief economist of the state-owned KfW Group. However, there are also warning voices – the pandemic should not be shelved too quickly.

“If we don’t take further measures, there will be a“ yo-yo effect ”,” warned Grimm. “It takes more than the emergency brake to get the infection numbers under control. It takes progress in vaccination and compulsory testing in the companies, which should be implemented consistently, ”said the professor at the University of Erlangen-Nuremberg.

The labor market is currently proving to be an anchor of stability – also because of the fact that there are still almost two million people who are spared unemployment through the instrument of short-time working with state aid. Marc Schattenberg, an economist at Deutsche Bank, even expects the labor market to pick up in spring. After seasonal adjustment, the number of unemployed will fall by 12,000 in April, he forecast. The Federal Employment Agency will publish its April statistics on the labor market next Thursday (April 29).

However, both Köhler-Geib and Grimm called for greater emphasis on qualification in the companies. “Over 3 million employees and 1.4 million unemployed have no professional qualifications,” said the KfW chief economist. “Qualification is the most promising way to enable employees in the lower wage groups to have higher incomes and to open up further prospects for short-time workers.”

Grimm fears long-term negative effects on the economy from the educational misery caused by the pandemic. “What we are currently neglecting in terms of education, the students we are losing, will keep us busy for some time and have significant long-term effects on growth,” she emphasized.