The pandemic has Berlin under control – but the city remains vital. Last year, the state-owned business development company Berlin Partner completed 262 projects, which created a total of 6,866 new jobs. The companies she advised are planning investments of 872 million euros, with around 116 million euros in “third-party funding” being raised for research and development. The total is divided between 80 companies newly settled in Berlin and the support of 102 existing companies. 80 other companies highlight the partners as “innovation projects”.
Thanks to this work, the gross domestic product rose by 1.6 billion euros, according to calculations by Berlin’s development bank IBB, which in turn improves public revenues: by 200 million euros.
Senator for Economic Affairs Ramona Pop said: “I can kindly reject the swan song for the Berlin economy.” The collapse in growth in Berlin – as a result of two shutdowns – was no greater than in the rest of the republic.
Across Germany, according to the statistics office, the decrease was 5.3 percent. The city even “performed better than expected” during the crisis. It was a “tough year”. But there is also good news. Roughly the number of jobs that grew by 6866 despite the pandemic.
More investments than last year – despite the crisis
The sum of the planned investments was even higher than in the previous “boom year”, said Pop. This proves the great confidence in Berlin that investments are being made here “because the city has an economic future”. The development shows that Berlin has set the right priorities. “Siemens Energy has moved to Berlin and is strengthening our energy cluster”. This is also a clear commitment to Berlin.
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Berlin will also remain the start-up capital. Most of the founders came through the crisis unscathed. The “financing rounds”, ie the raising of capital from investors, are the yardstick for the strength of start-ups. There were 314 financing rounds last year, 20 percent more than in the previous year despite the pandemic. Berlin is the “number one location in Germany” for start-ups, said Berlin partner boss Stefan Franzke.
“Tesla Effect” attracts companies to the region
“The structural change helps Berlin because a lot of new things are emerging in Berlin, that gives hope,” said Franzke. He spoke of the “Tesla effect” in the area of ”mobility”. Many service providers from this sector increased their activity in the city because of the electric car manufacturer or are considering a settlement. This can also be seen in the – albeit small – increase in jobs subject to social security contributions in the past year.
The origin of the new entrepreneurs working in Berlin is remarkable: just under half come from Germany, almost one in five from the Middle East, Asia and Oceania, 17 percent from the American continent and 15 percent from Europe and Russia. The Berlin Partners have obtained “approved residence permits” for 323 people and for employees in 223 companies.
Berlin partner boss Franzke said that around half of the jobs were created in existing companies. For example in a company that uses artificial intelligence. The Berlin company Shopify, which offers trading platforms on the Internet, has expanded. And the card service provider Here has hired 400 new employees.
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The health industry is also strong, Nuvisan, who have taken over the research division from Bayer, are building a “lab”, as Franzke said. Industrial production is still one of the most important sectors. “Many are amazed,” says Franzke, that industry can exist in a metropolis. But Schindler and BMW are “core companies of the Berlin economy” and the area is still ahead of the health industry in terms of volume.
The settlers include the health industry with 21,800 companies as one of the city’s most important economic sectors. The industry employs 383,000 people and has a turnover of 28 billion euros. The company Rox Health, a subsidiary of the Roche healthcare group, has relocated from this sector.
The creative industries and IT employ almost 300,000 people
The “information and communication technology” and “media and creative industries” sectors are particularly strong, with almost 290,000 employees in around 52,000 companies and a turnover of 33.8 billion euros. New in Berlin in this area is the MXC Foundation, which offers information technology for the “Internet of Things” and the “Smart City” of the future.
Other economic “clusters” in the city are “traffic, mobility, logistics”, “energy technology”, “optics and photonics”, industrial production, electromobility and smart cities as well as art.
And what are the prospects? If the Senator for Economic Affairs has its way: brilliant as soon as the pandemic is under control. Pop sees the “Roaring Twenties” reappear in Berlin. Because of digitization, the attraction of Berlin to talent and new large settlements like Tesla. “We are well prepared”.
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