The Mittelstand will redeem German innovation
TALK TO GERMAN bosses these days and sooner or later one will bring up “Buddenbrooks”. Thomas Mann’s epic tale of the eponymous clan of grain merchants and their demise is required reading in Germany’s business circles, as well as its schools. Today it serves as a convenient metaphor for the country’s perceived economic decline. GDP may contract this year. Inflation remains stubbornly high. The anti-immigrant Alternative for Germany party is second in some opinion polls, imperilling Germany’s reputation for openness to skilled foreigners. Iconic companies are fleeing abroad. bASF, the world’s largest chemicals firm, is building its $10bn state-of-the-art factory in China. Linde, an industrial-gas group, delisted from the stock exchange in Frankfurt to escape its cumbersome rules but kept its listing in New York. BioNTech, which helped develop one of the world’s first covid-19 vaccines, is setting up its cancer-research operations in Britain.
Viewed through a tragic Buddenbrookian lens, German decline can seem inevitable. Not to Nicola Leibinger-Kammüller, chief executive of Trumpf, a 100-year-old family company based in Ditzingen, near Stuttgart, which makes industrial tools such as laser cutters and punching machines. In Mrs Leibinger-Kammüller’s reading, the Buddenbrooks’ downfall was not caused by others. They brought it on themselves, by turning their backs on the virtues of thrift and hard work. That leaves a path to redemption. And this, she believes, runs through the Mittelstand, the German economy’s enterprising backbone.
The Mittelstand is home to some 3.5m small and medium-sized businesses. They are as diverse as their wares, which range from chainsaws to industrial software. Some are large and old: Trumpf has 17,000 employees worldwide and annual revenues of €5.4bn ($5.8bn). Others are small and young, like TeamViewer, an 18-year-old computer-maintenance firm with 1,400 employees, or…
2023-09-14 06:55:18
Article from www.economist.com
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