The business-oriented research center calculated the losses for the six-year period from 2020 in prices adjusted to gross domestic product (GDP). Per employee, this means a loss of added value of more than 20,000 euros due to the Covid-19 pandemic, the consequences of Russia’s war against Ukraine and the confrontational policy of the United States of America.
IW experts state that a quarter of the total losses occurred during the last year, which was marked by customs conflicts with the administration of US President Donald Trump. Official data show that the German economy avoided a third consecutive year of no growth in 2025, with real GDP increasing by 0.2 percentage points.
“Although previous decades have had periods of crisis, the current year is marked by extraordinary shocks and huge economic adjustments, which significantly exceed the pressures of previous crises,” said IW researcher Michael Grömling.
According to his calculations, the economic losses during the period of stagnation from 2001 to 2004 amounted to about 360 billion euros in real terms, while the financial crisis of 2008-2009. resulted in a loss of added value of approximately 525 billion euros.
Grömling compared the actual development of the economy with a hypothetical scenario in which the aforementioned crises did not occur in order to assess the extent of the losses. Assuming that, without the crises, economic activity would have grown at the average rate of the last three decades, the analysis shows “significant and growing economic losses.”
“After recovering from the pandemic shock, economic activity in Germany has not exceeded the level of 2019 for three years now,” Grömling concluded.
Due to the de facto stagnation and the assumed continuation of growth in the opposite scenario, the gap between the actual and potential development of the economy has been constantly increasing, resulting in continuous and significant economic losses in recent years.
