Why is Germany So Good at Manufacturing?

release date: 07/25/2016

A full 21% of Germany’s economy is fueled by manufacturing. Exporting nearly $1.4 trillion dollars of German manufactured goods each year to the U.S., Asia, and beyond, Germany is inarguably the world’s manufacturing powerhouse. But what made Europe’s stalwart such a manufacturing success story?

Small and Medium-Sized Enterprises

Whereas more attention gets showered on multi-national juggernauts, Germany’s actually powered by their small- and medium-sized enterprises (SMEs). More than 1,000 SMEs in Germany actually lead or come second in the world in their niche industry, appealing to smaller but dedicated markets in their particular field.

The Fraunhofer Society

Why are these SMEs so successful? Germany has something called the Fraunhofer-Gesellschaft (Fraunhofer Society), a non-governmental organization that essentially provides short-term research capabilities to small firms that couldn’t afford it otherwise. The organization’s research focuses on applicable, cost-efficient results and provides significant R&D innovation to German manufacturers seeking to compete on a global scale.

Across the board, the 22,000 people who actually work for the Fraunhofer Society focus on accommodating older technology to today’s market using new developments. Germany is particularly good at implementing new advancements across an industry in a short period of time, thanks in large part to the Fraunhofer Society.

The Apprenticeship Program

Vocational education is a huge priority in the German educational system. Beginning in the teenage years, German youths are allowed the opportunity to begin years-long apprenticeship programs in specific fields such as laminating, woodworking, metalworking, and machining. From there, the highly-skilled workforce of Germany is borne.

Over 22% of Germans work in the manufacturing sector, and the government also has a very successful system in place that keeps wages high (to attract talented individuals) and steady (to keep them.)

Germany’s focus on testing, innovation, and quality gave rise to its world-renowned machining industry decades ago. Commitment from both the government and the public sector has allowed manufacturing to become a valued, respected profession as well as for the country itself to flourish in the global exports market.

Protech is an Official US Distributor for Many German Manufacturers

Protech International works with an array of German manufacturers who focus on niche, quality-driven machines. German producers emphasis on excellence and constant revolution are a big reason our clients keep turning to German-made products. For more information on the lines we carry or the products we service, contact us.