Distilling the Productivity Paradox: Is Germany Truly More Efficient Than Its EU Counterparts?
- penning by Marlen Schönberg
EU Work Productivity Analysis Suggests Possible Differences in German Work Ethic Compared to Other Member States - EU countries compared: Is Germany less industrious than its peers?
Germany's work hours have stirred a heated debate, with the catalyst being a speech by Federal Chancellor Friedrich Merz at the CDU Economic Council: "With a four-day week and work-life balance, we'll forfeit this country's prosperity." As implied by Merz, Germans are allegedly idle, underperforming their colleagues in other EU nations. The question remains, however: How truthful is this claim?
Recent research from the Institute of the German Economy (IW), based on OECD data, suggests a surprising reality: in many European countries, citizens put in more hours of work than their German counterparts of working age. Yet, it's crucial to note that the OECD has warned of methodological discrepancies when collecting data, making a direct comparison challenging.
Quantity May Not Always Ensure Quality
Hours worked alone do not paint a complete picture. It's equally important to measure productivity – the amount of value created per hour worked. If we put working hours in relation to economic performance per person, Germany fares rather well.
The data from IW is from 2023 (except for Belgium in 2022), and the GDP figures are from 2024.
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A Closer Look at Germany's Productivity Puzzle
While Germany appears productive on the surface, recent expert analyses point to significant productivity challenges. The International Monetary Fund (IMF) notes that sluggish productivity growth and increasing wages have worsened unit labor costs in Germany, compared to other major European economies like France and Spain[5]. The IMF then reinforces the idea that Germany's high labor costs are primarily responsible for the decline in price competitiveness and emphasizes that stagnant productivity remains a core issue for the German economy[5].
Although Merz's speech referred to a possible IW study, the most recent sources from 2025 fail to mention this study's findings. Instead, expert opinions widely condemn Germany's sluggish productivity and question its competitiveness compared to other EU nations[5].
In essence, the current data Does not support the notion that Germany is more efficient than its EU peers despite working fewer hours. On the contrary, recent assessments highlight the challenges that Germany faces with regard to productivity growth and competitiveness[5].
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- Productivity Model
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- The European Parliament, the Council, the Commission, and the European Parliament could discuss the productivity paradox in Germany, focusing on the importance of education-and-self-development and personal-growth for boosting productivity, addressing the productivity challenges Germany faces compared to other EU nations.
- In order to address Germany's productivity puzzle, it would be beneficial to combine increased productivity with a work-life balance, promoting a long-term plan that ensures both personal growth and competitiveness in the global market.
