Technical innovation flourishes in Berlin
  • Home
  • Business
  • It’s official: Berlin remains Germany’s most innovative state
02.12.2020

It’s official: Berlin remains Germany’s most innovative state

For the fifth time in a row, the ING Innovation Index names Berlin the most innovative federal state in Germany.

ING is a bank that operates globally in 40 different countries. Its roots are Dutch and go back to the eighteenth century. Every year the economists from ING bring out their Economic & Financial Analysis of Germany, in which they measure the performance of the 16 federal states based on eight indicators.

The indicators are:

  • Age potential
    The proportion of under 50 year-olds compared to over 50 year-olds working in companies, because younger employees generally bring new knowledge and a fresh mindset to their employers.
  • Education
    Percentage of employees with higher education compared to employees overall, because more highly educated people show a greater potential for innovation.
  • Operating dynamics 
    Ratio of businesses founded to businesses closed.
  • Flexibility 
    Proportion of freelancers in the workforce, because a higher level of self-employment leads to greater economic flexibility and potentially increases knowledge transfer between companies.
  • Patent applications 
    Patent applications relate to adaptability and innovation.
  • Employment in the high-tech sector 
    Amount of people employed in the high technology and science sector.
  • Internet connections 
    Availability of fast broadband Internet (≥ 50Mbit/s) for households.
  • Startups
    Startup headquarters by state per 1,000 inhabitants, defined as startups and innovative companies with less than 1,000 employees.

ING uses diverse data sources: the Federal Employment Agency, the Federal Statistical Office and Destatis, IfM Bonn, DPMA, BMVI, Eurostat, Crunchbase, and Refinitiv. 

Having evaluated and weighted all the data, ING came to the conclusion for the fifth time running that Berlin is number 1 in innovation.

ING Innovation Index 2020
Ranking in the ING Innovation Index 2020

Hamburg comes in second place on the innovation index, as the city state did last year, primarily because it is the youngest region demographically. A change comes at third place, with Baden-Württemberg replacing Bavaria.

Reasons why Berlin is most innovative

Thirty years after the reunification of Germany, Berlin as city state spearheads the six eastern states in terms of innovation. Not only that, no other German federal state has as many people founding so many enterprises, east or west. The startup scene is strongest in Berlin. And in no other state are as many people per capita employed in high tech jobs. 

Berlin is also on top because employees have on average the highest level of education. Furthermore, there are more freelancers on average than in any other state. So all in all, Berlin gets top points in half of the eight indicators, and doesn’t do badly in any of the others.

The eight innovation indicators on a color scale
The 2020 Innovation Index in detail – green means top points, red lowest – © ING Economic & Financial Analysis

Thank you ING for confirming what we knew already. That Berlin is the innovative heart of Germany. 


Text: Olaf Bryan Wielk, ideenmanufaktur
Header image: © Wüstenhagen

More articles

Next

Why should you start a business in Berlin?

Welcome to Berlin – the vibrant city in the heart of Europe! Berlin attracts businesses and startups from every sector. Science, research, and creative industries also love Berlin. True innovators enjoy living and working in Berlin, as the conditions for setting up a company in the city are outstanding.

Infrastructure

Berlin offers the ideal infrastructure for setting up a company. The city’s new international airport makes Berlin quicker and easier to reach than ever from all over Europe and the world. Berlin’s public transport network is extensive and excellent. Office space is plentiful and rents are still lower than in most European capitals. And if you just want to test the waters, few cities have as many co-working spaces as Berlin.

>> Berlin – Heart of Europe

Innovative Industries

In Berlin, you can join networks and discover businesses in all the key innovative industries, including high tech, healthcare, life sciences, service economy, mobility, and logistics. There is also plenty of potential for rewarding and conducive partnerships with research facilities and other institutions and organisations in Berlin.

>> Doing Business in Berlin

Starting Out and Scaling Up

Feel the spirit of entrepreneurship in Berlin! Berlin startups such as Zalando, DaWanda, and ImmobilienScout24 are major influencers in the German market, and venture builders like Rocket Internet and Project A are also located in Berlin. Accelerators and incubators exist at every level and for almost any sector.

>> Starting up in Berlin

Research & Science

Berlin is the capital for researchers and scientists in Europe. You’ll find research on the hottest topics in fields like bio technology, medicine, communication technology, photonics, mobility and transport, and more, carried out by top-level experts at universities and institutions of world renown.

>> Brain City Berlin

Living in Berlin

Finally, the large pool of highly skilled specialists from all over the world is a key reason to locate a company in Berlin. Thanks to the relatively low cost of living and vibrant cultural scenes, Berlin attracts many highly talented people – which directly benefits businesses in the city.

>> Life in Berlin

A growing German economy – good for entrepreneurs and investors

GDP growth is high and unemployment is low. A large market with consumers who like to spend. It's a great time for investments and market entry in Germany. Reason-Why.Berlin offers useful information on the German economy and various aspects of building business in Berlin.