“A flourishing economy was and is the basis for a good life and work in the Free State of Saxony. Our strengths are based on an efficient SME sector, highly qualified and committed skilled workers, a modern infrastructure, an excellent university and research landscape and a diverse arts and cultural scene,” says Saxony’s Minister of Economic Affairs Martin Dulig.
At the same time, Saxony’s economy is also currently facing a challenging economic situation in Germany. Most recently, the gross domestic product of the Free State of Saxony fell by 0.6 percent in real terms from 2022 to 2023. The causes are wide-ranging and interwoven. These include the uncertainties arising from the global crises, the existing challenges of transformation, high energy costs, the effects of inflation and rising interest rates, which are putting pressure on the existing economic model.
“The answer to these challenging conditions remains a future-oriented economic policy in which we continue to create excellent location and living conditions – even in changing times. This is a good basis for continuing to be successful in the future and successfully mastering the profound transformation of the economy that we are currently experiencing,” said Minister of Economic Affairs Martin Dulig.
An overview of the key findings of the location report
Wealth and income continue to rise
- The Free State of Saxony achieves 91 percent of the EU average with a gross domestic product weighted by purchasing power of 32,200 euros per inhabitant. This means that Saxony continues to be among the top Central and Eastern European states.
- Disposable income per inhabitant grew again with an increase of 4.6 percent in 2022 and is now over 91 percent of the German average.
Employment continues to grow, unemployment rate reaches record levels
- With 508 people in employment per 1,000 inhabitants, job density is by far the highest of the eastern German states.
- Saxony’s unemployment rate has fallen from 11.8 percent in 2010 to 6.2 percent in 2023. The gap to the German average of 5.7 percent is now only 0.5 percentage points. This is the eleventh year in a row that Saxony’s unemployment rate has been below the European average.
Saxon SMEs form the backbone of the economy
- The SME sector is the most important employer and trainer. Of the approximately 132,000 companies, almost 95 percent have fewer than 50 employees. 71 percent of all employees subject to social security contributions earn their income in small and medium-sized enterprises (SMEs) with fewer than 250 employees. SMEs with a turnover of up to 50 million euros generate 54 percent of the state’s turnover.
- With 55,534 businesses, the skilled trades have a strong share in the various sectors of manufacturing, construction, trade and services. The density of skilled trades in Saxony is exceptionally high: at 13.6 businesses per 1,000 inhabitants, it is well above the German average of 12.2 businesses per 1,000 inhabitants and is also in fourth place among all federal states.
Saxony’s efficient research and development (R&D)
- R&D expenditure accounts for over three percent of gross domestic product. This puts Saxony in sixth place among all federal states.
- Around 34,100 people were employed in research and development in Saxony in 2021. Of these, almost 15,300 people work in companies conducting R&D. This means that Saxony accounts for almost half of all R&D employees in the new federal states.
Background
The brochure “Saxony as a business location compared with other regions in 2024” is being published for the 17th time. It is available in German and in the condensed English version “Location of Saxony 2024 – in comparison with other regions”.
Both publications can be obtained free of charge from the Saxon State Government’s brochure mailing service at www.publikationen.sachsen.de. They are also available for download.
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Further links
👉 www.smwa.sachsen.de
Photo: pixabay
