The analysis shows that the mood varies depending on the economic sector. In industry, which plays a key role in the German economy, the percentage of companies with an optimistic approach is slightly higher than average and amounts to 18.2%. However, in other industries the situation is much less promising. In the construction sector, as much as 33.2 percent. enterprises are afraid of the deterioration of their condition, and similar concerns are expressed by 32.5 percent. companies from the retail industry.
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German companies are afraid of 2026. “No optimism in sight”
“Enterprises remain cautious. There are no signs of optimism anywhere.”– Klaus Wohlrabe, director of IFO, commented on the study results.
Experts point out that the German economy is struggling with many challenges, including rising energy costs, falling demand and new tariffs imposed by the United States. In response to these problems, the government of Chancellor Friedrich Merz, the leader of the Christian Democrats, took steps to stimulate the economy. The increase in spending on infrastructure and military is intended to be a development impulse.
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German economy in trouble
Research institutes, including IFO, predict that the stimulus packages introduced by the government may contribute to economic recovery in 2026-2027. Meanwhile, the priority for the coalition of Christian Democrats and Social Democrats remains overcoming the recession that has been weighing on the German economy for two years.
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