Business appeal diminishing in Leipzig - Businesses Find Leipzig Less Appealing
Leipzig, once a bustling economic hub, has seen a decline in its popularity over the past few years. A joint study conducted by the Chamber of Crafts and the Leipzig Chamber of Industry and Commerce (IHK) has revealed that the city's economic standing has taken a hit due to several structural issues.
The survey, which questioned a total of 291 member companies of all industries and sizes, did not provide specific figures for the current ratings of Leipzig by companies. However, it did indicate a significant drop in the proportion of "good" ratings for the city, falling from 69% to 46%. In 2021, only 7% of companies rated Leipzig as "very good," down from 15% in 2019.
Businesses have expressed concerns about several aspects of Leipzig's economic landscape. The difficulty in creating sufficient jobs and attracting new industries has been a major issue, with former industries closing without adequate replacement investment. Lower salaries compared to national averages also reduce the attractiveness for skilled workers, impacting economic vibrancy.
The decline in retail and commercial life, with many vacant storefronts and disrepair in parts of the city center, is another concern. This implies weaker economic activity and potentially deters business expansion or relocation. Furthermore, the leasing and real estate market in Leipzig, while offering lower rents, has limited take-up of commercial space, suggesting caution among businesses.
Broader economic shifts, such as the regionalization and de-globalization of industries, affect Germany overall. However, Leipzig particularly struggles to capitalize due to less access to global and non-European markets.
Despite these concerns, Leipzig is still considered one of the most attractive economic hubs in Germany. The quality of life in Leipzig remains a bright spot, according to the analysis. However, bureaucracy is a thorny issue in the city, as indicated by the survey.
The IHK President, Kristian Kirpal, emphasized the importance of reducing costs for businesses, eliminating unnecessary bureaucracy, and shortening processing and approval times. Leipzig's Mayor, Burkhard Jung (SPD), stated that a strong economy is crucial, as around a quarter of the city's income comes from trade tax, and without it, expenditures for social issues, culture, climate protection, or economic promotion would not be possible.
The survey results did not mention any change in Leipzig's status as one of the most attractive economic hubs in Germany. However, they were taken "very seriously" by the city. The city administration is working to address the concerns raised by businesses and improve Leipzig's economic standing.
- To enhance Leipzig's economic standing, it is crucial for the city to focus on community policies that prioritize vocational training, as this could help attract new industries and create sufficient jobs.
- The city administration, in collaboration with financial institutions, should consider offering incentives to businesses, such as reduced costs and streamlined processes, to encourage growth and attract investments in vocational training programs, thereby boosting Leipzig's appeal within the business and industry sectors.
