-Stagflation: Combination of high inflation with uneven economic growth and high levels of unemployment. 1973-1982

-The unemployment rate rose from 0% in 1970 to ~10% towards the end of the decade. Inflation soar to 8%

• Rise in oil prices, largely owing to the OPEC oil embargo in 1973 and contracting economies in the developed world.

• The stagflation following the oil price shock of 1973 was the first major economic setback since the war.

• Stagflation: Combination of high inflation with uneven economic growth and high levels of unemployment. 1973-1982

• The unemployment rate rose from 0% in 1970 to ~10% towards the end of the decade. Inflation soar to 8%.

• GDP growth fell from 4.8% in 1973 to -0.9% in 1975, while the unemployment rate jumped from 1.2 to 4.7%.

• Crisis was learning experience

  
  

Source:

https://www.dw.com/en/why-are-germans-searching-for-stagflation-on-google/a-59501160

https://files.stlouisfed.org/files/htdocs/publications/review/05/03/part2/Issing.pdf

Source: https://en.wikipedia.org/wiki/Economic_history_of_Germany#:~:text=GDP%20rose%20by%20two%2Dthirds,due%20course%20from%20the%20boom.

Oil price increase caused problems; solved by mid-70s through investments in own industry and exports to oil countries.

Exports to developed countries declined after peak in 1973 at 13.6% receded by 1.3%.

15 billion dollar deficit, caused by increased oil price and removal of money from the system, due to travel and transfer.

Sources: https://www.britannica.com/place/Germany/Modern-economic-history-from-partition-to-reunification

https://www.nytimes.com/1981/04/13/business/germany-s-economy-stumbles.html

Source: https://www.britannica.com/place/Germany/The-East-German-system

• was set up in 1990

• change East Germany state-owned businesses into private ones

• its job was to help these adapt to how things worked in a market economy where companies compete to sell products and services

Unemployment and GDP in Germany since 2010

Unemployment:

In the early part of the decade, Germany experienced a relatively low unemployment rate. The aftermath of the 2008 financial crisis saw a gradual recovery, and by 2010, the unemployment rate was relatively low. Over the years, Germany's economy continued to grow, and the labor market remained robust.

In 2020, the COVID-19 pandemic had a significant impact on the global economy, leading to disruptions in various sectors, including employment. Many countries, including Germany, witnessed an increase in unemployment due to lockdowns, restrictions, and economic challenges associated with the pandemic. The German government implemented various measures to support businesses and workers during this period.

The current economic issues include:

Economic Contraction: Germany has experienced three quarters of contraction or stagnation, potentially making it the only major economy to shrink in 2023.

Future Growth Concerns: The IMF predicts slower growth for Germany compared to other major economies over the next five years.

Complaints and Challenges: Despite low unemployment (around 3%), citizens express dissatisfaction, with four out of five Germans stating that their country is not fair. Challenges include delays in public transportation and bureaucratic obstacles.

Investment and Innovation: Germany is criticized for not adequately investing in new industries and technology. The country's investment in information technology is noted to be less than half that of the United States and France.

Global Challenges: Germany's strong ties with China, energy transition difficulties, and an aging population pose significant challenges. Trade tensions, emissions reduction, and demographic shifts are impacting the manufacturing sector.

Talent Shortage: Germany is facing a shortage of skilled workers, and demographic trends suggest that 2 million workers will retire in the next five years. Immigration rules have been liberalized, but challenges persist in attracting skilled professionals.

The article concludes by emphasizing the need for Germany to adapt its economic model to thrive in a changing world. Suggestions include fostering new firms, investing in infrastructure and technology, and addressing talent shortages through immigration reforms.

• Germany had a relatively low unemployment rate in the early part of the decade.

• The 2008 financial crisis led to a gradual recovery, and by 2010, the unemployment rate was relatively low.

• Germany's economy continued to grow over the years, with a robust labor market.

• The COVID-19 pandemic in 2020 significantly impacted the global economy, leading to employment disruptions.

• Many countries, including Germany, saw an increase in unemployment due to lockdowns and economic challenges from the pandemic.

• The German government implemented measures to support businesses and workers during the pandemic period.

• Economic Contraction

  
  

• Future Growth Concerns

• Public Dissatisfaction

• Investment and Innovation Shortfalls

• Global Challenges

• Talent Shortage