A daily bulletin of news & opinion

17 January 2010

After years of longing for a job for life and worshipping the ideal of staying at home in comfort, Germans are showing signs of becoming globally minded entrepreneurs. In 2009, for the first time since the Second World War, more new businesses were launched than became insolvent. Also, in 2008, for the first time in 25 years, more people emigrated than immigrated. It’s an indication that Germans are learning not just to rely on corporate jobs or the excellent welfare state but are instead taking their futures into their own hands.

Maybe it was the financial crisis that finally showed us the limitations of the rules our parents still rely on. All of a sudden things Germans tend to value – safety, a predictable rhythm of life, the daily commute – seem outdated, especially for the young. “At entry level there are recruitment freezes and precarious working conditions everywhere now,” says Werner Eichhorst, deputy director at the Institute for the Study of Labour. “Highly qualified and motivated people are entering the labour market who can’t find appropriate jobs. They might think about trying something new.”

Indeed for Germans the most valuable lesson of the crisis is to let go of the patriarchal system of Rhenish Capitalism and try their hands at entrepreneurship. According to the Institut für Mittelstandsforschung, a think-tank dedicated to the study of small businesses, 410,000 new companies were founded in 2009 in Germany. And interestingly, businesses with 20 employees or less have weathered the crisis best. Young Germans in Berlin, Hamburg and Munich are starting everything from shops selling high-quality chocolate to e-learning companies. New communication technologies are making it easier than ever to find customers all around the world. Experts refer to today’s 18- to 25-year-olds as the Creative Generation. It’s a generation that doesn’t only want to consume but also produce.

This is a chance for Germany to reinvent itself. “Restructuring of the economy has been accelerated by the crisis. The classic worker at companies such as Opel, Schaeffler or Märklin will sooner or later lose his job,” suggests Eichhorst. Mail-order giant Quelle, a symbol of the old Bundesrepublik, is already gone.

Germans have never been very entrepreneurial-minded, “because of the country’s tradition of social security, long-lasting employment and a desire for safety,” says Eichhorst. But lately being self-employed has gained a more positive image, he adds. The government has started to foster entrepreneurship with programmes such as Ich-AG, though it could do more. Instead of giving money to companies that sooner or later will shrink or disappear, Eichhorst would rather see politicians help small start-ups.

Also education in Germany needs to stop placing knowledge above creativity, says Dietmar Grichnik, professor at Otto Beisheim School of Management as “this impedes entrepreneurship in later life”. Although it’s not administrative barriers that have stopped Germans from starting their own business – it’s fear of failure, according to a recent report by Wharton University.

But for more and more Germans these emotional barriers are vanishing. They instinctively feel what the experts know: times of crisis have historically been incubators for successful new ideas. According to Eichhorst there are many fields for Germans left to explore. He names energy efficiency, intelligent buildings, traffic solutions and healthcare, among others: “It’s the companies that are started now that we will hear about in a few years.”


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  • The Entrepreneurs