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Shopping: Here’s how the pandemic has hit German spending habits

Consumers in Germany have been spending a lot less during the pandemic, new research has confirmed - with clothing shops hit particularly hard.

Shopping: Here's how the pandemic has hit German spending habits
People shopping in Cologne in March 2021. Photo: DPA

Many shops and indoor dining in restaurants have been closed for months, and lots of people have been working from home – so it’s perhaps not a huge surprise that the restrictions put in place to stem the spread of Covid-19 in 2020 are leaving a clear mark on private consumption.

According to calculations by the Institut der Deutschen Wirtschaft (IW), consumers in Germany spent an average of at least €1,250 less in 2020 than in the year before the crisis started.

In total, this corresponds to a decrease in consumer spending of €116 billion, according to the study by the research institute.

Compared to 2019, consumption fell by 6.1 percent – more than it has in 70 years.

For the first quarter of 2021, researchers put the consumption shortfall at a further €40 to €60 billion.

READ ALSO: Here’s how Germany’s Kinderbonus payments boosted economy in pandemic

In 2020 German residents would have bought very few short-lived consumer goods such as clothing or shoes, write the authors of the study, reported Spiegel.

The purchase of durable consumer goods, such as cars or furniture, also declined in the course of the first lockdown, but demand in the second half of 2020 increased by five percent compared to the previous year.

The IW experts partly attribute this to the temporary VAT cut put in place by the German government in a bid to boost spending.

In 2020 as a whole, the decrease in spending totaled €78 billion – more than two percent of the German GDP.

“The state-decreed closure of body-related services, restaurants, hotels, leisure and event facilities have made many consumer wishes impossible,” summarised IW’s Hubertus Bardt.

Researchers expect private consumption to catch up as the pandemic subsides. But at the moment it appears people are still not in the buying mood.

According to a survey carried out by the IW together with other research groups, 43 percent of Germans want to save the part of their income that remains after basic expenses. Usually it is less than 30 percent.

And only a third of those surveyed stated that they currently plan to spend money on vacations – in non-pandemic times this number is usually 45 to 50 percent.

Again, this isn’t surprising given that Germany is still in the grip of the third wave of the pandemic, with no signs of when people will be able to go shopping and travel freely again.

Vocabulary

Consumer/consumers – (der) Verbraucher or (die) Verbraucher

Decrease/decline in consumer spending – Rückgang der Konsumausgaben

im Vergleich mit – compared with

Durable – langlebig

We’re aiming to help our readers improve their German by translating vocabulary from some of our news stories. Did you find this article useful? Let us know.

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COVID-19

Pandemic in Germany unlikely to end this year, says top virologist

High profile German virologist Christian Drosten believes Germany will see a severe spike in Covid infections after summer, and that the pandemic will not become endemic this year.

Pandemic in Germany unlikely to end this year, says top virologist

Drosten previously said that Germany would probably be able to declare the end of the pandemic this year.

But in an interview with Spiegel, Drosten said he had reevaluated his opinion. 

“When the Alpha variant came, it was very surprising for me. When Delta appeared I was sceptical at first, then with Omicron we had to reorient ourselves again. And since January there have already been new Omicron subtypes.

“So I would actually like to correct myself: I no longer believe that by the end of the year we will have the impression that the pandemic is over.”

READ ALSO: End is in sight for pandemic in Germany, says virologist 

Drosten also said that Germany will not see a largely Covid-free summer, which has been the case in previous years, and a further increase in infections in autumn. 

“We are actually already seeing an exponential increase in case numbers again,” Drosten said.

“The BA.5 variant (of Omicron) is simply very transmissible, and people are losing their transmission protection from the last vaccination at the same time.”

In other countries, he said, when the number of cases become high, hospitalisation and death rates also rise again. “Unfortunately, that will also be the case here,” said Drosten, but added: “Overall, however, far fewer people will become seriously ill and die than in 2021.”

Drosten said he expected many more infections from September.

“I hope that the school holidays will dampen the increase in cases somewhat. But from September, I fear we will have very high case numbers,” the head of the virology department at Berlin’s Charité hospital told Spiegel.

READ ALSO: German Health Minister lays out autumn Covid plan

Virologist Christian Drosten at a Covid press conference in 2021.

Virologist Christian Drosten at a Covid press conference in 2021. Photo: picture alliance/dpa | Kay Nietfeld

If the government does not take any action, he predicted there would be a lot of sick leave across all industries. “That will become a real problem,” he said.

Drosten said he did not expect overcrowded intensive care units in Germany.

But the new BA.5 sub-variant, which is becoming dominant in Germany, may affect people more strongly. 

“The wheel is turning more towards disease again,” said Drosten. It is not true that a virus automatically becomes more and more harmless in the course of evolution. “That makes me even more worried about the autumn,” he said.

Drosten recommends wearing masks indoors during the colder months, saying it is “the least painful” measure.

If, in addition, “up to 40 million people could be immunised or given a booster vaccination” before winter, for example by urgently calling for company vaccinations, that would “really make a difference”, Drosten said.

In the long term, he said it’s inevitable that people will become infected with coronavirus.

He said the population immunity due to vaccinations and infections will at some point be so strong that the virus will become less important. “Then we will be in an endemic state,” said Drosten. In the worst case, however, this could take “several more winters”.

However, Drosten warned against people trying to deliberately infect themselves with Covid, saying getting the infection in summer doesn’t mean people will be protected in winter. 

Drosten himself said he has not yet contracted Covid-19.

“So far, I guess I’ve just been lucky,” he said. “I rarely put myself in risky situations, but I’m not overly cautious either.”

‘Pandemic depends on behaviour’

According to the Robert Koch Institute (RKI)’s latest weekly report, more outbreaks are occurring in care homes, and the number of patients in intensive care units is slightly rising as infections go up. 

The institute said there had been a 23 percent increase in the 7-day incidence compared to the previous week. On Friday the 7-day incidence stood at 618.2 infections per 100,000 people. There were 108,190 infections within the latest 24 hour period and 90 deaths. 

“The further course of the pandemic depends not only on the occurrence of new virus variants and the uptake of vaccinations on offer, it also depends to a large extent on the behaviour of the population,” said the RKI.

According to the DIVI intensive care register, the number of Covid-19 patients in ICUs had increased to 810 on Thursday this week, from about 600 at the beginning of the month.

However, that number is still low compared to previous Covid peaks when thousands of people were in intensive care in Germany. 

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