In 2020, the Covid 19 pandemic caused a recession in almost all countries worldwide. Overall, the worldwide gross domestic product (GDP) shrank by 2.7 percent. A study on the future development of the economy in Germany, Bavaria and the world, commissioned by the vbw - Vereinigung der Bayerischen Wirtschaft e. V. (Bavarian Business Association), shows: In 2021, the global economy is already recovering significantly with a plus of 5.2 percent. This means that globally the pre-crisis level has already been reached again. Some of the larger EU member states, including Germany, however, will need until 2022. Different economic effects of the pandemic In some countries, the recession in 2020 was significantly more severe than the projected recovery in 2021. This includes the large western EU member states (including Germany) and the United Kingdom. Other countries such as Switzerland, Poland or the USA will be able to recover from the recession already in 2021. South Korea and China even made it through 2020 without a recession. The main reason for the relatively rapid recovery of the global economy: the recession was not caused by structural imbalances, but by an exogenous shock. As soon as the trigger of the shock – the pandemic – is under control, the economy can resume its dynamic pre-crisis development. Long-term growth of the global economy Overall, global economic output is expected to grow by two-thirds between 2020 and 2040. China will probably make the largest contribution with 31 percent, followed by the USA with 18 percent and the European Union with 11 percent. However, the EU will have to position itself more confidently in the future in order to retain a significant role among its rivals China and the USA. Germany in the long term Until 2040, the German economy will grow at a moderate pace of 1.1 percent per year on average. This growth depends primarily on technological progress. Without technical progress – which is increasingly driven by digitalisation – the German economy would shrink in the coming decades. Spotlight on Bavaria In the past, economic growth in Bavaria has been stronger than in Germany as a whole. And Bavaria will continue to grow somewhat faster in the future (1.2 percent annually until 2040). Responsible for this difference are high-growth sectors that are particularly well represented in Bavaria, such as vehicle construction or the information and communication sector. In addition, Bavaria benefits from a more favourable demographic development. While the German population as a whole will shrink slightly from the mid-2020s, it will continue to grow in Bavaria until the mid-2030s. Structural change continues In Germany today, the goods and services produced are different than a few decades ago, and the labour force is largely employed in different economic sectors than it was back then – economic structures are subject to constant change. "By now, a large part of output and employment in our country is in the service sector. Nevertheless, in international comparison Germany and Bavaria are characterised by a strong industrial core," says Prognos project manager Johann Weiß. And structural change will continue in the future. The vbw Prognos Report takes a detailed look at the prospects for the 20 most important sectors. The future of Bavaria's sales markets Bavaria and Germany are closely intertwined with economies all over the world. Accordingly, the development of the domestic economy also depends on the economic development of the international markets. This is especially true for export-oriented industrial companies. Based on long-term forecasts, the vbw Prognos Report shows future trends and development prospects in 25 economies that are of particular importance for Bavarian foreign trade. The study is not publicly available. If you have any further questions, please contact vbw Authors: Jakob Ambros, Dr Michael Böhmer, Dr Heiko Burret, Dr Oliver Ehrentraut, Jan Limbers, Philipp Kreuzer, Heidrun Weinelt, Johann Weiß (project manager), Eva Willer Our work on this topic Take a look at our latest projects and activities. The future of theglobal economic order 2025 | Project The current global economic order is faltering. What does this mean for Germany and the EU? We have developed various scenarios for the future global economy for the vbw. Read more German industry’s resilience and sovereignty 2025 | Project German industry is heavily dependent on raw materials and intermediate products from abroad, especially from China. Prognos analysed supply chains and developed recommendations for action. Read more Evaluation of the Federal Funding for Efficient Buildings (BEG) ongoing | Project On behalf of the BMWK, we evaluate the impact of the BEG in the funding period 2021 – 2025 together with ifeu, ITG, and FIW. Read more Conference on Industrial Resilience 10. April 2025 | Event Michael Astor presents the results of the study on the resilience and sovereignty of the German industry, which we conducted on behalf of the Netzwerk Zukunft der Industrie e. V. (Future of Industry Network). The results will then be discussed by industry representatives. Read more How dependent are we really on the US and China? 2025 | Expertise Foreign trade, employment, investment and raw materials: ahead of the new US administration taking office, we analysed for the Süddeutsche Zeitung how dependent our economy is on the US and China. Read more New markets for the export sector – 2024 update 2024 | Project Even if the global trade in goods is no longer growing, there are still promising markets for German business. We present 13 potential markets in Asia and Latin America. Read more Skilled workers for the energy transition 2024 | Project How many laborers and skilled workers will Germany need for the green transformation of its economy? We examined this question on behalf of the German Chamber of Industry and Commerce. Read more New procurement markets for the German economy – update 2024 2024 | Project German industry can increase the resilience of its supply chains by sourcing its intermediate products from different countries. We have analyzed these new procurement markets. Read more A greener economy through green finance 2024 | Project With green finance, greenhouse gases in Austria can be reduced by up to four per cent by 2040 – in the bond market alone. This is the result of our study commissioned by the Ministry for Climate Action. Read more Conversion of the automotive industry: How employment is changing 2024 | Project The automotive industry is undergoing fundamental change. How does this effect employment? And what will it mean for the individual professions? We investigated this on behalf of the VDA. Read more Long-term care financing scenarios 2024 | Project Higher numbers of care-dependent persons and increasing costs - our aging population is putting long-term care insurance to the test. A new analysis shows what the future financial require-ments will be. Read more Industry Conference 2024 26. November 2024 | Event Together with the Alliance for the Future of Industry, the BMWK is organising the Industry Conference 2024, where Michael Astor will present initial interim findings from our study on the resilience and sovereignty of German industry. Read more Germany Potential Index: Digitalisation to counter the skilled-worker shortage 2024 | Project The skilled-worker shortage is only due to get worse in the future. Our Potential Index shows: Increased digitalisation can help to cushion the negative consequences of the skilled-worker shortage in Germany. Read more Climate protection investments for the transformation of the energy system 2024 | Project On behalf of the Federal Ministry for Economic Affairs and Climate Action, we calculated the investments that will be required to restructure capital stock in the course of the envisaged net zero transition. Read more Guest article in SPIEGEL: How Europe's economy can catch up with the USA and China 2024 | Expertise A race to catch up - this is what Europe needs if it is not to be left behind by the USA and China. In the SPIEGEL guest article, Christian Böllhoff calls for a new match plan with clear priorities for the new EU legislative period. Read more Prognos Economic Outlook® (PEO®) ongoing | Project In uncertain times, there is a growing demand for orientation. PEO® delivers independent figures. Based on our wolrd economy model we project the developments until 2045. Read more Evaluation of the Central Innovation Programme for SMEs (ZIM) 2024 | Project The Central Innovation Programme for SMEs (ZIM) strengthens the innovative power of small and medium-sized enterprises. This is shown by our evaluation for the BMWK. Read more Significance of the German economy for Europe 2024 | Project Growth in the German economy benefits the whole of Europe. Our study for the vbw shows that this is due to the size of the economy and its strong foreign trade networks. Read more Study on Poverty and income inequality in the context of the digital transformation 2024 | Project The study for the European Commission examines the impact of digitalisation on the employment situation in the individual member states as well as on the EU economy as a whole. Read more Guest article in WirtschaftsWoche: "Move Europe - it's urgent!" 2024 | Expertise In his guest article "Move Europe - it's urgent!" in WirtschaftsWoche, Christian Böllhoff calls for Europe to reposition itself geo-economically in order to strengthen its position between the economic giants USA and China. Read more Germany: Industry sectors put to the test 2024 | Expertise Mechanical engineering, the automotive industry, pharmaceuticals: In which sectors is Germany still a leader? On behalf of the Handelsblatt, we examined how successfully Germany is holding its own against its international competitors. Read more Future-proof strategies for Europe 2024 | Project Germany and Europe are trying to find their place in the New World Order. Prognos examined four foreign trade strategies for the vbw. Read more Five challenges: How Europe remains competitive in the future 2024 | Expertise What needs to happen for Europe to survive in global competition? We analysed this at the “12 Minutes Europe – Meeting Global Challenges” event organised by the Austrian Federal Economic Chamber. Read more Ludwig-Erhard-Gipfel 17. - 19. April 2024 | Event Christian Böllhoff, CEO of Prognos, discusses the topic of (de)globalization at the Ludwig Erhard Summit with host Dr Wolfram Weimer. Read more The invisible value of care work 2024 | Expertise 72 billion hours: That is how many unpaid care work hours are performed in Germany, annually, by women. In a new paper, we show the value of unpaid care work and how unevenly it is dis-tributed between men and women. Read more Innovation Index Germany 2023 2024 | Project Once again, Prognos has compiled the Innovation Index Germany on behalf of the Vodafone Institute for Society and Communications. The index quantifies the impact the expansion of Germany’s digital infrastructure has had on its innovation strength. Read more Regional purchasing power of pensions 2023 | Project Where in Germany is retirement particularly cheap and where has it become more expensive than average? Prognos examined this for the German Insurance Industry Association. Read more Value added of German pharmaceutical exports 2023 | Project Compared to other export sectors, German pharmaceutical exports show above-average levels of innovation and value-added intensity. However, the industry is falling behind in the global re-search competition. This is shown by a new study commissioned by Roche. Read more New procurement markets for the German economy 2023 | Project New procurement markets can help increase the resilience and efficiency of the German and Bavarian supply chains. The study quantifies the current procurement markets and those still yet to be further exploited. Read more Supply chains: no climate neutrality without raw materials 2023 | Project Crises continue to put global trade routes at risk. This study by Prognos and partners indicates the measures necessary to secure strategically important supply chains. Read more The future of the automotive industry in Saarland ongoing | Project The automotive industry continues to undergo fundamental change worldwide. How does this transformation affect the Saarland economy? Read more Increased gas prices and gas price brakes 2023 | Project A study for the vbw on the impact of the gas price brake for Bavarian companies. Read more Effects of deglobalisation on Germany and Europe 2023 | Project Increasing geopolitical tensions are endangering the world trading system. On behalf of the vbw, Prognos investigated possible consequences for the economy in Germany and the EU. Read more Article in "Die Volkswirtschaft": EU reaction to electricity prices 2023 | Expertise The liberalisation of the electricity markets in the EU was once supposed to reduce costs. Sven Kreidelmeyer writes in the Swiss magazine "Die Volkswirtschaft" about the effects of free competition and current developments in the European electricity sector, among other things. Read more Where does Germany's economy really stand? 2023 | Company news Why it’s time for Germany to take an honest look at itself. A guest commentary in the WirtschaftsWoche by Dr Michael Böhmer. Read more Evaluation of the federal grants to GTAI 2022 | Project The aim of Germany Trade and Invest (GTAI) is to promote German foreign trade. Prognos investigated whether they are using their budget effectively. Read more Purpose Economy model 2023 | Project Could purpose become the model for business and society? We investigated this as part of our work for the Future Office and compared it with other scenarios. Read more Decarbonisation of raw materials industries in Germany 2022 | Project A study for the Bertelsmann Stiftung shows which climate policy measures can best support the switch to low-emission production processes. Read more In danger: Objectives of the “Ampel-Koalition” 2023 | New project A short new analysis shows to what extent the shortage of skilled workers threatens the central political projects of the Federal Government. Read more Was it the West’s intention to isolate Russia economically? It did not succeed. 2023 | Expertise Our new analysis shows: Trade with Russia has by no means completely collapsed. Read more Ressource efficiency in Bavaria ongoing | Project Efforts to reduce the consumption of resources in the Bavarian economy must be increased. A Prognos study provides information on the status quo and the starting points for savings. Read more Gas consumption in Germany’s production sectors 2023 | Project One potential building block: the Federal Network Agency commissioned Prognos to conduct a study that can support the necessary assessment in the case of gas shortages. Read more Accelerated climate protection does pay off 2023 | Project If the expansion of renewable energy and the implementation of efficiency measures are ac-celerated, electricity prices will fall more quickly, and the GDP will grow faster. These were the findings of our short study for the INSM. Read more Ecological transformation and the labour market in Schleswig-Holstein ongoing | Project How many specialists will Schleswig-Holstein need to implement its climate protection measures? What are the key professions necessary for successful implementation? Read more Germany’s business model 2023 2023 | Project Why politicians and companies need to act consistently - and how they can do so. Joint study with BayernLB. Read more Are globalization and Germany’s business model on the way out? Why policymakers and companies need to act decisively – and how they can ensure future success. Joint study with BayernLB. Read more Inflation – extra burden and relief for family households 2022 | Project Calculations on inflation-related additional private household expenditure and the work of the Federal Government's relief package. Read more The effects of Chinese subsidies on Germany 2022 | Project Prognos examined the potential impact of Chinese subsidy practices on Germany in three core sectors of the German economy. Read more Benefits of Covid testing for the Swiss economy and the healthcare system 2022 | Project Testing for Covid interrupted chains of infection, relieved the burden on the health system, and supported the economy. We quantified these effects for Roche Diagnostics Switzerland. Read more Resilient supply chains in the EU 2022 | Project What are possible solutions when supply chains are disrupted due to external shocks? A survey conducted for the European Commission as part of the European Cluster Collaboration Platform provides answers. Read more Adobe Stock - CleverStock About us Prognos – Providing Orientation. Prognos is one of the oldest economic research centres in Europe. Founded at the University of Basel, Prognos experts have been conducting research for a wide range of clients from the public and private sectors since 1959 – politically independent, scientifically sound. Learn more