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11/04/2025 11:00

What the German Mittelstand Needs Now

Dr. Jutta Gröschl Presse- und Öffentlichkeitsarbeit
Institut für Mittelstandsforschung (IfM) Bonn

    In view of the impact of increasingly uncertain global trade and the digital and green transformation on the Mittelstand in Germany, the IfM Bonn believes that companies need maximum entrepreneurial flexibility. At the end of October, IfM researchers explained how this can be realised, using their study findings on efficient bureaucracy reduction as an example, when State Secretary Gitta Connemann, who is also the Federal Government Commissioner for Small and Medium-Sized Enterprises, visited the institute.

    "The IfM is the academic research centre for the Mittelstand. It arose from a letter exchange between Ludwig Erhard and Konrad Adenauer. These roots show that SMEs are more than just an economic factor. They're not only the backbone, but also the future of our country. And they represent attitude, passion and home," explained Parliamentary State Secretary Gitta Connemann when she visited the IfM in Bonn at the end of October.

    The Federal Government Commissioner for the Mittelstand Enterprises cited the lack of statutory maternity benefits for pregnant self-employed women as an example of what she believes needs to be addressed urgently: "In Germany, self-employed women entrepreneurs have no legal entitlement to maternity protection. This disadvantages precisely those women who create jobs, pay taxes and drive innovation. Business or family – no woman should have to face this question anymore. Germany needs every female founder, every successor, every family entrepreneur. Self-employed women and female entrepreneurs finally deserve fair conditions that allow them to balance family and business. We will propose concrete solutions for this at the federal level." In her presentation, IfM researcher Dr Susanne Schlepphorst highlighted the consequences of the lack of maternity benefits for self-employed craftswomen: "While employees are financially supported before and after the birth of their child through maternity pay and the employer’s maternity allowance supplement, self-employed mothers have no statutory entitlement to income replacement benefits. As a result, for example, many self-employed craftswomen continue to perform regular physical work during pregnancy – work that would trigger protective measures or employment restrictions for employees. They also tend to suspend their professional activities only a few days before giving birth and return to their businesses just a few weeks later." The currently debated pay-as-you-go financing model for compensating income loss during maternity leave represents a solidarity-based solution. Nevertheless, it must not be overlooked that for many self-employed women, it remains difficult to completely close their businesses around the time of childbirth.

    IfM researcher Michael Holz emphasised the need for a paradigm shift in reducing bureaucracy: away from a focus on control and towards greater practical applicability of legal regulations – not least to reduce the psychological costs for businesses, such as feelings of powerlessness or frustration about regulations often perceived as disproportionate. In the worst-case scenario, this could lead to “autonomous deregulation”, meaning that some requirements are deliberately not met. Throughout the entire regulatory cycle, systematic measures should be implemented to prevent excessive bureaucracy from arising in the first place or to ensure that it can be effectively reduced. Parliamentary State Secretary Gitta Connemann picked up on the findings of the IfM Bonn study and explained: "Reducing bureaucracy is a must. The Mittelstand enterprises do not need more regulations, but more freedom. Overregulation costs time, money and innovative strength – everything that our businesses desperately need elsewhere. The Mittelstand enterprises deserve our trust. The first steps have been taken with the modernisation agenda and our practical checks. But that is not enough – also in the interests of the state. Reducing bureaucracy is the cheapest economic stimulus programme ever."

    "The Institut für Mittelstandsforschung (IfM) Bonn is characterised by its interdisciplinary and practice-oriented research approach. This enables us to study the situation, development, and challenges of the SME sector in a comprehensive manner and to contribute to improving general framework conditions through policy recommendations," summarised IfM President Professor Dr Dr h.c. Friederike Welter, who is also a professor at the University of Siegen, the productive discussions with the Federal Government Commissioner for the Mittelstand Gitta Connemann.

    The IfM Bonn was founded in 1957 on the initiative of Ludwig Erhard by the Federal Republic of Germany and the State of North Rhine-Westphalia as a private-law foundation. All research results are available on the Institut für Mittelstandsforschung website: www.ifm-bonn.org


    Images

    Parliamentary State Secretary Gitta Connemann spoke with the President Prof. Dr Dr h.c. Friederike Welter and the researchersw of IfM Bonn
    Parliamentary State Secretary Gitta Connemann spoke with the President Prof. Dr Dr h.c. Friederike W ...
    Source: IfM Bonn
    Copyright: IfM Bonn


    Criteria of this press release:
    Business and commerce, Journalists, Scientists and scholars, Students, Teachers and pupils, all interested persons
    Economics / business administration
    transregional, national
    Research results
    English


     

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