Press release No.191 / 2008-05-27

Detailed results on the economic performance in the 1^st quarter of 2008

WIESBADEN – As already reported by the Federal Statistical Office (Destatis) in its first release on 15 May 2008, the German economy started with much momentum into the new year after 2007 had ended not very lively: Upon price, seasonal and calendar adjustments, the gross domestic product (GDP) was 1.5% higher in the first quarter of 2008 than in the last three months of the preceding year.

Gross domestic product, price-adjusted, chain-linked
(figures adjusted for seasonal and calendar effects using Census X-12-ARIMA)
Changes on a quarter earlier:
2006				2007				2008
1st quarter	2nd quarter	3rd quarter	4th quarter	1st quarter	2nd quarter	3rd quarter	4th quarter	1st quarter
0.9%	1.3%	0.7%	1.0%	0.6%	0.2%	0.7%	0.3%	1.5%

Economic growth in the first quarter of 2008 was supported primarily by gross fixed capital formation, which continued on a high level. Compared with the fourth quarter of 2007, 4% more was invested in machinery and equipment, and capital formation in construction rose by even 4.5% owing to the comparatively mild winter. Changes in inventories contributed 0.7 percentage points to economic growth. Overall final consumption expenditure, which increased by 0.5%, also had a positive effect. Government final consumption expenditure was up markedly (+1.3%), while the final consumption expenditure of households showed a slight increase of 0.3% against the previous quarter. The positive trend of exports (+2.4%) in fact continued in foreign trade but as imports rose much more markedly (+3.5%), foreign trade on the whole had a downward effect on the gross domestic product compared with the preceding quarter.

The following information refers to the year-on-year comparison:

In the first quarter of 2008, GDP was a price-adjusted 1.8% higher than in the same quarter one year earlier. The growth rate was a calendar-adjusted 2.6% as there had been two working days less in the reference quarter than in the first three months of 2007.

Gross domestic product, price-adjusted, chain-linked (unadjusted figures)
Changes on a year earlier:
2006				2007				2008
1st quarter	2nd quarter	3rd quarter	4th quarter	1st quarter	2nd quarter	3rd quarter	4th quarter	1st quarter
3.4%	1.6%	2.7%	3.7%	3.4%	2.5%	2.4%	1.6%	1.8%

The gross domestic product was achieved by about 39.8 million persons in employment, which were 686 000 persons or 1.8% more than one year earlier. The number of unemployed persons (international definition) amounted to just under 3.5 million, their share in the entire economically active population being 8.0%.

Overall labour productivity (price-adjusted gross domestic product per person in employment) rose slightly by 0.1%. Measured per hour worked, there was an increase by 0.8% since the number of hours worked by those in employment rose much less than the number of persons in employment. Unit labour costs (calculated as the ratio of labour costs paid by domestic employers to labour productivity), were 1.4% higher than in the first quarter of 2007 according to the concept based on the number of persons in employment and up 1.6% according to the concept of hours worked.

As regards the production side of the gross domestic product (price-adjusted), all economic sectors except for construction made a positive contribution to economic growth. Major engines of growth were industry (including energy) and trade, transport and communications. In each of these areas, the price-adjusted gross value added was 2.9% higher than in the first quarter of 2007. This means that industry (including energy) again improved its result on a high level but the rate of increase was somewhat smaller than in the last quarters. Gross value added rose 2.2% for financial, real estate, renting and business activities and 1.7% for agriculture, hunting and forestry, fishing. The result of other service activities rose marginally (+0.3%). The result of construction was 1.4% lower than in the first three months of 2007. For the fourth time in a row, the construction industry has not managed to achieve the corresponding result of one year earlier. However, the decline in production slowed down in the reporting quarter: In the third quarter of 2007, the result recorded by construction had been 1.5% smaller and in the fourth quarter of 2007 even 2.4% lower than one year earlier.

As regards the use side of the gross domestic product, contributions to economic growth originated both from the domestic territory and from abroad. Upon price-adjustment, gross fixed capital formation was 2.6% higher than in the same period of the previous year. This was due to another strong increase in gross fixed capital formation in machinery and equipment. Businesses invested 6.2% more in machinery and transport equipment than one year earlier. As in the two preceding quarters, capital formation in construction fell (–0.9%), which was primarily due to declining investments in residential construction. In contrast to that, somewhat more was invested in other buildings and structures than in the first three months of the previous year (+0.2%). A slight increase by 0.1% was recorded for the final consumption expenditure of households after it had declined in the four preceding quarters. This slightly positive trend is above all due to a recovery of private car purchases. Expenditure for transport and communications, which includes also private car purchases, rose by a price-adjusted 2.2%. In 2007, households had reduced their expenditure for that use by a total of 4.1% (annual value). Households’ price-adjusted expenditure for food, beverages and tobacco, however, declined strongly (–4.7%). In contrast to the compasion with the preciding quarter, foreign trade contributed considerably to economic growth. Price-adjusted exports rose by 5.9%, imports by a mere 4.0% compared with the first quarter of 2007. The resulting export surplus contributed 1.1 percentage points to economic growth.

At current prices, the gross domestic product was 3.2% and the gross national income 3.3% higher in the first quarter of 2008 than one year earlier. Net national income (factor costs), which is made up by compensation of employees and property and entrepreneurial income, increased by 3.9%. Compensation of employees (+3.4%) on a quarterly basis showed the highest rate of increase since the end of 2000. Nevertheless, property and entrepreneurial income has risen more strongly again from January to March 2008 (+4.8%) than compensation of employees. The disposable income of households was up 2.6%, nominal final consumption expenditure by 2.5%. The savings ratio of households amounted to 14.8% and was 0.4 percentage points higher than one year earlier.

In addition to the first quarter figures being calculated for the first time, the results previously published for the four quarters of 2007 and the year 2007 were checked and revised where necessary.

The above and other national accounts data may be accessed via the internet (http://www.destatis.de). In addition, more detailed results are published in Fachserie 18 “Volkswirtschaftliche Gesamtrechnungen”, Reihe 1.2 “Vierteljahresergebnisse“ (order number 2180120) and Reihe 1.3 “Saisonbereinigte Vierteljahresergebnisse nach Census X-12-ARIMA und BV4.1“ (order number 2180130). Those publications are available for free download from the Publications Service of the Federal Statistical Office.

>>> brief methodological description

For further information please contact:
National accounts info team,
tel: (+49-611) 75-2626,

E-mail: gdp-info@destatis.de

Gross domestic product
Price-adjusted, chain-linked
		Unadjusted figures		Figures according to Census X-12-ARIMA
		Unadjusted figures		Seasonally and calendar adjusted		Calendar adjusted		Calendar effect
		2000 = 100	% ¹⁾	2000 = 100	% ²⁾	2000 = 100	% ¹⁾	% ¹⁾
¹⁾ Change on the same quarter of the preceding year in %. ²⁾ Change on the previous quarter in %.
2006	1st quarter	102.70	3.4	104.21	0.9	102.05	2.1	1.3
	2nd quarter	104.99	1.6	105.58	1.3	105.27	3.0	–1.3
	3rd quarter	107.25	2.7	106.36	0.7	107.67	3.2	–0.5
	4th quarter	108.42	3.7	107.41	1.0	108.56	4.0	–0.2
2007	1st quarter	106.21	3.4	108.10	0.6	105.87	3.7	–0.3
	2nd quarter	107.63	2.5	108.28	0.2	107.97	2.6	–0.0
	3rd quarter	109.84	2.4	109.00	0.7	110.34	2.5	–0.1
	4th quarter	110.18	1.6	109.29	0.3	110.48	1.8	–0.1
2008	1st quarter	108.16	1.8	110.96	1.5	108.67	2.6	–0.8

Gross domestic product at current prices
		Unadjusted figures		Seasonally and calendar adjusted figures according to Census X-12-ARIMA
		EURO billion	Change in % ¹⁾	EURO billion	Change in % ²⁾
1) Change on the same quarter of the preceding year in %. 2) Change on the previous quarter in %.
2006	1st quarter	558.90	3.9	570.21	0.9
	2nd quarter	571.20	2.3	578.09	1.4
	3rd quarter	590.50	3.4	584.09	1.0
	4th quarter	601.60	4.3	590.87	1.2
2007	1st quarter	586.90	5.0	600.50	1.6
	2nd quarter	597.40	4.6	604.72	0.7
	3rd quarter	616.80	4.5	610.43	0.9
	4th quarter	622.70	3.5	612.68	0.4
2008	1st quarter	605.40	3.2	624.25	1.9

Gross domestic product, gross national income and
net national income (factor costs)
Seasonally and calendar adjusted with Census X-12-ARIMA
	2007				2008
	1st quarter	2nd quarter	3rd quarter	4th quarter	1st quarter
¹⁾ Only seasonally adjusted.
Change on the previous quarter in %
At current prices
Final consumption expenditure of households and NPISHs	–1.5	1.3	0.7	–0.0	1.0
Government final consumption expenditure	1.8	0.1	0.5	–0.3	2.4
Gross fixed capital formation	3.6	–1.0	0.8	1.3	4.3
Machinery and equipment	4.0	0.9	0.3	2.6	3.9
Construction	3.9	–2.9	1.1	0.1	5.6
Other products	–1.8	2.4	1.3	2.3	–4.3
D o m e s t i c u s e s	2.6	–0.5	0.9	0.0	2.9
Exports	–0.4	1.6	2.1	1.0	2.6
Imports	1.5	–1.0	2.3	0.4	5.0
G r o s s d o m e s t i c p r o d u c t (GDP)	1.6	0.7	0.9	0.4	1.9
Price-adjusted, chain-linked
Final consumption expenditure of households and NPISHs	–1.8	0.8	0.3	–0.8	0.3
Government final consumption expenditure	1.8	0.1	0.4	–0.6	1.3
Gross fixed capital formation	1.7	–1.4	0.7	1.5	3.7
Machinery and equipment	3.7	0.9	0.4	3.4	4.0
Construction	0.6	–3.8	0.7	–0.5	4.5
Other products	–2.4	4.0	3.0	4.0	–3.4
D o m e s t i c u s e s	1.6	–0.9	0.7	–0.3	1.9
Exports	–0.3	0.8	2.5	1.3	2.4
Imports	1.6	–1.7	2.9	0.2	3.5
G r o s s d o m e s t i c p r o d u c t (GDP)	0.6	0.2	0.7	0.3	1.5
memorandum item:
GDP per person in employment (labour productivity)	0.1	–0.2	0.3	–0.2	1.0
At current prices
Gross national income ¹⁾	2.2	–0.6	1.9	0.3	1.8
Net national income (factor costs) ¹⁾	1.5	–0.8	3.0	0.0	1.6
Compensation of employees ¹⁾	1.3	0.8	0.2	0.6	1.7
Property and entrepreneurial income ¹⁾	1.7	–3.7	8.5	–1.0	1.4
Disposable income of households ¹⁾	–0.6	0.7	0.4	1.0	0.5
Contributions to growth of price-adjusted GDP in percentage points
Domestic uses	1.4	–0.9	0.7	–0.2	1.8
Final consumption expenditure of households and NPISHs	–1.1	0.4	0.2	–0.4	0.2
Government final consumption expenditure	0.3	0.0	0.1	–0.1	0.2
Gross fixed capital formation (GFCF)	0.3	– 0.3	0.1	0.3	0.7
including: GFCF in machinery and equipment	0.3	0.1	0.0	0.3	0.3
GFCF in construction	0.1	–0.4	0.1	0.0	0.4
Changes in inventories, etc.	1.9	–1.0	0.3	0.0	0.7
Balance of exports and imports (net exports)	–0.8	1.1	0.0	0.5	–0.2

Gross domestic product, gross national income and
net national income (factor costs)
	2007					2008
	Year	1st quarter	2nd quarter	3rd quarter	4th quarter	1st quarter
Change on the same quarter of the preceding year or on the previous year in %
At current prices
Final consumption expenditure of households and NPISHs	1.2	1.0	1.6	1.6	0.8	2.5
Government final consumption expenditure	2.3	2.1	2.5	2.6	2.0	2.9
Gross fixed capital formation	7.8	15.3	6.9	5.7	4.9	3.4
Machinery and equipment	7.4	9.7	6.8	6.4	7.1	5.1
Construction	8.6	22.2	7.5	5.4	3.2	2.2
Other products	3.3	2.6	2.8	3.5	4.1	1.7
D o m e s t i c u s e s	2.6	3.5	2.1	2.3	2.8	2.7
Exports	8.2	10.4	10.0	8.6	4.2	6.2
Imports	4.6	7.4	4.6	3.8	2.7	5.7
G r o s s d o m e s t i c p r o d u c t (GDP)	4.4	5.0	4.6	4.5	3.5	3.2
Price-adjusted, chain-linked
Final consumption expenditure of households and NPISHs	–0.4	–0.3	–0.0	–0.2	–1.3	0.1
Government final consumption expenditure	2.2	2.2	2.5	2.3	1.6	1.2
Gross fixed capital formation	5.0	11.9	3.8	3.0	2.8	2.6
Machinery and equipment	8.2	10.6	7.6	7.1	7.9	6.2
Construction	2.3	14.4	0.5	–0.5	–2.2	–0.9
Other products	6.6	4.3	6.2	7.1	8.4	7.6
D o m e s t i c u s e s	1.0	2.1	0.3	0.6	0.9	0.7
Exports	7.8	9.9	9.3	8.4	3.9	5.9
Imports	4.8	7.6	4.9	4.6	2.6	4.0
G r o s s d o m e s t i c p r o d u c t (GDP)	2.5	3.4	2.5	2.4	1.6	1.8
memorandum item:
GDP per person in employment (labour productivity)	0.7	1.5	0.8	0.8	–0.2	0.1
At current prices
Gross national income	4.4	5.3	3.7	4.8	3.8	3.3
Net national income (factor costs)	4.1	4.7	3.2	5.0	3.7	3.9
Compensation of employees	2.9	3.0	3.1	2.6	2.8	3.4
Property and entrepreneurial income	6.6	7.7	3.5	9.2	5.6	4.8
Disposable income of households	1.6	1.5	1.8	1.7	1.4	2.6
Contributions to growth of price-adjusted GDP in percentage points
Domestic uses	0.9	2.0	0.3	0.6	0.8	0.7
Final consumption expenditure of households and NPISHs	–0.3	–0.2	0.0	–0.1	–0.7	0.1
Government final consumption expenditure	0.4	0.4	0.4	0.4	0.3	0.2
Gross fixed capital formation (GFCF)	0.9	1.8	0.7	0.6	0.5	0.4
including: GFCF in machinery and equipment	0.6	0.7	0.6	0.5	0.7	0.4
GFCF in construction	0.2	1.1	0.0	–0.1	–0.2	–0.1
Changes in inventories, etc.	–0.1	–0.1	–0.8	–0.4	0.8	0.0
Balance of exports and imports (net exports)	1.6	1.5	2.2	1.9	0.8	1.1

For more details please refer to the German version.

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Press release No.191 / 2008-05-27

Detailed results on the economic performance in the 1st quarter of 2008

Detailed results on the economic performance in the 1^st quarter of 2008