IMK presents study and recommends increasing the resilience of supply chains
In the period from the beginning of 2021 to mid-2022, German industry was unable to produce goods worth around 64 billion euros due to a lack of intermediate products. This is reported by the Macroeconomic Policy Institute (IMK) of the Hans Böckler Foundation based on a study it conducted.
As the IMK explains, in their study the economists compare the actual gross value added as recorded by the Federal Statistical Office with an estimated counterfactual scenario without bottlenecks in intermediate products.
The researchers currently come to the following conclusion: without the supply chain disruptions, which are due to production stoppages in East Asia and transport problems, but also to miscalculations in companies’ procurement strategies, the entire manufacturing sector in Germany would have generated 39.2 billion euros more value added in 2021. From the beginning of 2021 to mid-2022, the difference even amounts to 63.9 billion euros, the institute writes in its press release.
According to the IMK, Germany’s gross domestic product would have been 1.2 percent higher at the end of 2021 and 1.5 percent higher in mid-2022 if all new orders received by industry in Germany from the beginning of 2021 had been processed. Consequently, the economic recovery after the end of the Corona restrictions was considerably weaker than would have been possible without supply bottlenecks.
Commenting on the study results, the researchers write, according to the IMK press release: “These figures support the need to attach greater weight to supply chain resilience in the future at the expense of cost efficiency.”