TPT March 2019

The German Federal Republic is one of the world's leading economic nations. How has it been so successful?

Around 100,000 new engineers and scientists arrive on the job market every year in Germany – young men and women who have just received a top-class education at one of the 200 engineering schools, or in the technical faculty of a university in the country. Germany also benefits from many well-qualified workers who have not attended university and who also contribute to the country's high productivity. This is the result of the dual education system, whose roots lie in the medieval crafts and trades teaching system, whereby young people acquire practical abilities and basic knowledge in a vocational school. If someone is working in the logistics industry then they learn languages, book-keeping and how markets work, and that becomes the framework within which they operate as a logistics expert. This provides the German economy with a reliable stream of skilled workers, from which mid-sized companies benefit the most. These, defined as companies that employ no more than 500 people – the so-called “Mittelstand” – are the backbone of the German economy. They stand for 99 per cent of the approximately three million companies in Germany, most of them family- owned. “Made in Germany” often includes a number of extra services. A company now doesn't just sell a machine – it installs it, it trains the buyer’s staff in how to use it and it offers a 24-hour repairs service. The company does everything it can to guarantee the machine's performance. Another guarantee for the success of the "Germany Model" is advanced technologies. Germany is practically forced to innovate, because it doesn't have any real natural resources. As many as 11 per cent of German workers are employed in high-tech industries – far more than the EU average. Every year, around €70bn is spent on research – more than in any other European country. Finally, only a few countries in the world can boast such well-developed networks in energy, telecommunications, roads, rail and aviation. Every European country is within a few hours' journey of Berlin. The country’s geographical location may well make up the final piece of the puzzle.

Reference: The Secrets of Germany's Economic Success, DW