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Berlin to go, english edition, 01/2018

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NEWS TO GO Strong

NEWS TO GO Strong economic tailwinds Strong housing growth Skilled labor high in demand The foundation of economic activity in Berlin has expanded in the last year. According to the Investitionsbank Berlin (IBB), the city’s tremendous economic momentum will continue throughout 2018. “In addition to consumer spending, investments made by Berlinbased companies are also contributing to the expansion,” noted Dr. Jürgen Allerkamp, IBB board chairman. Berlin is expected to post an economic growth of 2.5% in 2018, with 2.7% expected in the first three months of the year (1st quarter 2018). The high number of construction permits issued for new residential construction in the past year (+10.2%) suggests that construction activity will continue at a strong pace in Berlin through 2018. The capital city’s housing market continues to experience an excess of demand in spite of significantly increased construction last year. Among the factors contributing to the expansion are higher incomes in Berlin as well as ongoing low financing costs thanks to continued low interest rates. Throughout the entire construction industry, prices are now rising sharply. Further momentum is coming from investors and sustained high levels of immigration. The number of people employed in jobs subject to compulsory social security contributions in Berlin continues to top the averages in previous years. In December 2017, there were 1,456,200 such individuals, roughly 58,800 people more than a year prior, which represents an increase of 4.2%. The demand for workers continues to be high in many businesses. Many sectors are looking for skilled labor, especially in the generally well-paying information and communication industry (ICT), in which roughly 93,100 individuals are currently employed. With 8,500 new hires (+10.3%), almost every seventh job created in Berlin is now in the future-oriented ICT sector. Illustration: Till Schermer 6

Berlin’s booming digital economy Berlin leads in new job creation Capital city tourist magnet Berlin’s digital economy continues to grow. According to a study by the Investitionsbank Berlin (IBB), companies in this sector of the information and communication technology industry (ICT) recently achieved a significant increase in revenue of around 7.1 percent. The number of individuals employed in the sector also continued to rise: in 2017, roughly 88,200 people were employed in the digital economy. This marks an increase of 14.1% over the previous year. In comparison, the increase was only 3.7 percent in Berlin’s overall economy. The number of people in gainful employment in Berlin in 2017 (1,950,100) clearly exceeded levels recorded for the previous year. The Berlin- Brandenburg Office of Statistics showed that Berlin had the highest job growth rate among all federal states in Germany, posting an increase of 2.9 percent since 2016. In 2017, 55,700 more people were employed in Berlin than in the previous year. “Berlin’s labor market remains on the upswing. Right through to the end of last year, we saw clear increases in the number of people employed, which is an indicator of the overall positive trend as regards Berlin’s status as a great location for business,” noted Berlin Economic Senator Ramona Pop. Berlin tourism posted positive figures in 2017, despite the insolvency of Air Berlin. The number of guests in Berlin hotels rose by 1.8 percent to reach 12.96 million. The number of overnight stays made by Berlin visitors rose by 0.3 percent to more than 31.15 million. At 55.1%, it was once again German guests who accounted for the largest share of total overnight stays. While 5.1 million visitors and thus roughly 1.2 percent more international guests traveled to Berlin, the number of their overnight stays decreased by 1.4 percent to 13.98 million. 7

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