The FINANCIAL — Germans’ 2017 per-capita purchasing power will increase nominally by 1.7 percent to €22,239. The country’s 25 most populous districts alone comprise one-fourth of Germany’s total purchasing power.
These are some of the findings of the 2017 GfK purchasing power study released on December 6.
GfK forecasts a total purchasing power of €1,827.5 billion for Germany in the coming year, which corresponds to a 2.9 percent nominal increase over the previous year. This equates to an average per-capita purchasing power of €22,239 that Germans have available in 2017 for spending on consumer purchases, accommodation, recreation and saving.
Purchasing power is a measure of the population’s disposable net income, including government subsidies such as pension payments, unemployment assistance and child benefit. Rising wages in many industries and the positive development on the employment market will lead to higher incomes, which has a beneficial effect on purchasing power levels. On the other hand, Germany’s population grew by 1.2 percent from 2015 to 2016. This explains why Germany’s overall purchasing power is increasing by a substantial 2.9 percent, while the per-capita purchasing power is growing only moderately by +1.7 percent. The real-value amount that remains from this nominal increase depends on how consumer prices develop in 2017.
Regional distribution of purchasing power
The list of Germany’s top ten districts is mostly unchanged from last year. As in previous years, the rural district of Starnberg remains Germany’s district with the highest per-capita purchasing power. With €32,194 per person, inhabitants of Starnberg have around 45 percent more purchasing power than the national average. The urban district of Munich overtakes Main-Taunus-Kreis to assume fourth place. With €17,496 per person, the rural district of Görlitz continues to be in last place among Germany’s 402 districts. The rural district of Ahrweiler represents the national average.
Comparison of purchasing power volumes
For retail, it is relevant to know not just the average per-capita consumer potential, but also where purchasing power is most geographically concentrated. Among Germany’s 402 districts, the 25 most populous counties alone comprise one-fourth of the nation’s total purchasing power.
The purchasing power volume of a district is of course closely related to its number of inhabitants. Even so, the urban district of Munich outranks the more populous urban district of Hamburg in terms of total purchasing power thanks to its above-average per-capita purchasing power. However, with the exception of Munich, none of Germany’s most populous districts reaches the per-capita values of the top ten districts. Together, the 25 most populous districts have a per-capita purchasing power only around 4.6 percent above the national average.
Many of the urban districts that are among the 25 most populous districts and have very high purchasing power volumes feature below-average per-capita purchasing power. These large urban districts are home to many inhabitants with significantly lower purchasing power, such as students in university cities. For example, the urban district of Duisburg is one of the country’s 25 most populous districts, but its per-capita purchasing power is 15 percent below the national average. Bremen and other urban districts in the Ruhr region such as Dortmund and Essen as well as the city region of Aachen also have below-average purchasing power. The three most populous districts in eastern Germany – Berlin, Leipzig and Dresden – also have per-capita purchasing power levels that range from 8 to 13 percent below the national average. But thanks to their dense concentrations of purchasing power, these areas as well as the other populous districts offer attractive conditions for retail locations.