According to the Munich Ifo Institute for Economic Research, an ascent from the “Corona valley” is to be expected. Unlike in the first and second quarters, growth of 6.9 percent in the third quarter and 3.8 percent in the quarter is forecast. An Ifo scientist commented: “From now on, things will gradually go up again.”
The strengthening in the second half of the year can be explained by the low production of goods and services during the time of the Corona lockdown. Overall, the economy will shrink, in 2020, by 6.7 percent compared to the previous year. At the end of 2021, growth of 6.4 percent in that period would restore the performance of the economy in 2019.
In 2020, the number of unemployed will increase by 0.4 million to 2.7 million, and will shrink to 2.6 million in 2021. This equals an unemployment rate of 5.9 percent for 2020 and 5.6 percent for 2021.
The number of employees this year will decrease from 45.2 million to 44.8 million and increase to 44.9 million in 2021, according to the Ifo Institute. The number of short-time workers decreased from May to June 2020 from just 7.3 million to 6.7 million.
Household consumption is expected to decrease by 6.4 percent in 2020. Equipment investments are currently falling by 19.9 percent. Despite the Corona pandemic, exports from Germany are expected to fall by 13.3 percent this year, and imports by 7.7 percent. In 2021, exports are likely to rise again by 13.4 percent and imports by 7.8 percent.