Office
With just under 3.7 million inhabitants and almost 1.5 million employees contributing to social insurance, Berlin is Germany’s capital and its largest city. At €73,400, the GDP per employed person is still 3% below the national average and well below the figures for the other major German cities. For historical reasons, Berlin is in the process of catching up economically. Both the GDP and the number of employees have been growing at an above-average rate for many years. The sharp rise in the number of employees (+3.5% in 2018 and +33.1% from 2009 to 2018) is colliding with the very tight availability of office space.
Retail
In Q4 the average unemployment rate was 4.8% indicating that the weakening in the German economy has not yet reached the labour market. Consumer sentiment, as measured by the GfK Consumer Climate Index, has been weakening but is still at a high level. Total German retail sales ended 2019 with an annual volume of almost €544 million and therefore were 3.2% higher than 2018. Online sales increased their share to almost 11%. Their growth rate was 8.9% while shop sales increased by 2.6%.
Industrial
According to Oxford Economics, the German economy closed Q4 2019 with growth of only 0.4% compared to the same quarter the previous year, thus bringing the total annual growth to 0.6% and making 2019 the weakest year of the six year period 2014-2019. The main reason for this was the decline in gross value-add of the manufacturing sector, not least due to the uncertainties in global trade. Business expectations in this sector, as measured by the Ifo Institute were negative in Q4 although some small recovery emerged at the very end of year. At the same time private and state consumption supported economic growth, with online trade increasing by 9%.
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