Life in Germany is becoming more and more expensive due to economic problems
The German economy is in trouble – and we all feel it.
This week some of our most read stories were on possible job cuts hitting Germany’s once-thriving auto industry – especially Volkswagen. But we also hear reports of people losing their jobs at all types of companies, including startups and smaller companies.
We also feel the economic crisis with the increase in consumer prices. In October, inflation increased more than expected (by 2%) according to preliminary official data.
Getting a nasty shock at the supermarket Box has become quite normal, while activities such as eating out are becoming more expensive.
The cost increases on the horizon are also having an impact on the budgets of German residents’ families: in 2025 the Deutschlandticket will be increased from 9 to 58 euros per month. Gasoline prices are rising again, while we are faced with rising health insurance costs.
Despite all this, there has been some cautious good news, at least regarding the bigger picture. Germany avoided a technical recession (which was not expected) and the economy actually grew by 0.2% in the third quarter. Experts say this is due to public and household spending.
That will be little consolation to the ever-struggling coalition government, which this week held two separate crisis summits on how to revive the German economy.
One thing we probably won’t see, at least under the current finance minister? Germany lets go of its beloved debt brake or debt brake, an instrument that reflects the country’s long-standing cultural fear of debt.
It remains to be seen whether politicians will succeed in easing the cost of living and returning the economy to stability, tasks that are even more important ahead of a federal election year.
Remember those who are gone
People in Germany celebrated All Saints’ Day or All Saints Day on November 1st, with some states even having a public holiday.
In addition to the memorial services held to remember the dead, people also decorate the graves of loved ones with flowers, candles and sometimes offerings of food and drink, as can be seen in this photo taken on Friday at the Melaten-Friedhof in Cologne.
The essence of the day is about solemnity, reflection and reconnection with those who have passed away.
Photo: Picture Alliance/dpa | Henning Kaiser
The United States goes to the polls: what will you do?
The Local has many readers who are from the United States, based in Germany, or elsewhere with connections to Germany.
It’s an exciting time for them (as well as everyone around the world) as the country decides its next president.
Will you be watching the results unfold from home? Or are you organizing a meeting with international friends and colleagues? Or will you try to avoid election news at all costs?
Maybe you are attending an event here in Germany. For example, the Democrats Abroad are holding a watch event from 9pm to 6am all night from November 5th at the Babylon Berlin cinema.
An official event with discussions and analysis by experts and media involvement is also planned which will take place at the State Representation of Baden-Württemberg in Berlin the night of the results.
For US citizens who have not yet registered to vote from abroad, it is unfortunately too late. But if you are already registered you may still be able to submit your ballot by maildepending on your state of residence. If you’re voting in the United States as we speak, good luck and happy voting!
Interview Between Time.news Editor and Economic Expert on Germany’s Current Economic Challenges
Editor: Good afternoon, and welcome to this special edition of Time.news. Today, we’re diving deep into the current economic challenges facing Germany, which is becoming increasingly pressing for many citizens. I’m joined by Dr. Elena Schmidt, a renowned economist and expert on European markets. Dr. Schmidt, thank you for being here.
Dr. Schmidt: Thank you for having me. It’s a pleasure to discuss such an important topic.
Editor: Let’s get right into it. The article we’ve published outlines a series of concerning developments in the German economy. From job cuts in the auto industry to rising inflation, can you help us understand the gravity of the situation?
Dr. Schmidt: Absolutely. Germany has long been regarded as the powerhouse of Europe; however, we are witnessing significant vulnerabilities. The auto industry is under pressure, especially with giants like Volkswagen facing potential job cuts. This is a key sector for both employment and economic stability. The ripple effect of job losses could drastically impact consumer confidence and spending.
Editor: Speaking of consumer prices, the article mentions that inflation rose by 2% in October, and everyday life is becoming more expensive. How are families coping with these changes?
Dr. Schmidt: Families are indeed feeling the pinch. With the cost of living rising—evident in more expensive groceries and dining out—it’s a tough time for many households. The upcoming increase in the Deutschlandticket, from 9 to 58 euros per month, is particularly shocking for commuters. It paints a stark picture of how inflation affects various facets of daily life, forcing families to reassess their budgets and spending habits.
Editor: And while inflation is a pressing concern, there seems to be a glimmer of hope—Germany avoided a technical recession, with a reported 0.2% growth in the third quarter. What’s driving this growth?
Dr. Schmidt: Yes, surprisingly, the economy managed a slight growth, thanks in part to robust public and household spending. People are still investing in experiences and engaging with the economy despite the rising costs. However, we must remain cautious; this growth may be short-term and could reverse if inflation continues to erode purchasing power.
Editor: What steps do you think the coalition government should take to stabilize this precarious situation?
Dr. Schmidt: The government’s recent crisis summits indicate an awareness of the severity of the challenges. However, they need to balance inflation control with stimulating economic growth. Investments in green technologies and supporting small and medium enterprises could be pathways forward. But it’s worth noting that the deeply ingrained fear of debt may hinder aggressive fiscal measures.
Editor: The article suggests that we likely won’t see the government abandon its “debt brake” anytime soon. How does this cultural approach towards debt impact the economic recovery?
Dr. Schmidt: The debt brake reflects a long-standing mentality in Germany where fiscal discipline is viewed as paramount. While this conservatism has its merits, it can stifle necessary investments during times when growth is needed most. Balancing fiscal prudence with proactive economic measures is crucial, especially as we approach a federal election year where citizens will be looking for answers.
Editor: Indeed, with the elections on the horizon, what should citizens keep an eye on as political parties formulate their strategies?
Dr. Schmidt: Voters should pay attention to how parties plan to address both immediate cost-of-living concerns and long-term economic sustainability. Promises that tie into job support in crucial industries like auto manufacturing, as well as sensible economic reforms that encourage growth, will be central to the debate. It’s crucial for citizens to advocate for solutions that address both their current struggles and their future.
Editor: Thank you, Dr. Schmidt, for your insights. It’s clear that while there are challenges ahead, there are also opportunities if handled with care. We appreciate your time and expertise on this important issue.
Dr. Schmidt: Thank you for having me. I hope to see meaningful changes in the near future for the people of Germany.
Editor: And thank you to our readers for tuning in. Stay alert for more updates as we continue to follow Germany’s economic journey closely.