As a result of the temporary corona lockdown, Germany is experiencing the greatest slump in economic activity in its history. The crisis has meanwhile also reached the labor market: short-time work announcements were made for over ten million employees in April.

After the Corona Shock: Digitization Potential for Germany
IW-Policy Paper
German Economic Institute (IW)
As a result of the temporary corona lockdown, Germany is experiencing the greatest slump in economic activity in its history. The crisis has meanwhile also reached the labor market: short-time work announcements were made for over ten million employees in April.
The crisis programs launched and implemented with a remarkably high frequency and speed represent a temporary compensation of the production and consumption gap that has so far not been known in terms of size and scope. The resulting significant increase in public debt has no alternative in terms of fiscal and budgetary policy. Therefore, the question arises as to how the measures of the current rescue policy could strengthen the future growth path of the economy. This paper turns to the megatrend of technology-driven digitization looking for central future growth factors. For some selected policy areas - labor market, research and development, education and qualification as well as public administration – it is firstly assessed what the status and potentials of digitalization in Germany are and what first Corona-driven changes can be observed. Secondly, some detailed derivations for local, state and federal politics are formulated, what needs for action have become even clearer in the crisis and what opportunities can be derived from this with a courageous exploitation of digitization potentials. The focus is on the importance of invention, innovation and digital infrastructures as enablers for future growth. It can be shown how the core of the Corona crisis can trigger a boost for the digitization of numerous fields of action in economic, educational and social policy. However, it should also be made clear in which specific cases the requirements for a successful digital transformation have to be improved and also where they still have to be created in some cases.

Hans-Peter Klös: Nach dem Corona-Schock – Digitalisierungspotenziale für Deutschland
IW-Policy Paper
German Economic Institute (IW)
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