Bitkom industry back on growth track

The business climate already developed positively for the most part in the final months of last year. At 19.7 points, the Bitkom-ifo Digital Index climbed in December to its highest level since February 2020, the digital association Bitkom announced at the start of the year in Berlin.

Following temporary losses, the information technology segment will gain in importance again in 2021 and expand its significance as the largest industry segment. According to Bitkom calculations, sales will rise by 4.2 percent to 98.6 billion euros in 2021. IT hardware - i.e., computers, servers and peripherals in particular - will see the strongest growth, with a strong increase of 8.6 percent to 31.6 billion euros.

The market for software is also back on track for growth. With growth of 4.1 percent to 27.0 billion euros, it is outperforming the industry average. The IT services business, which includes IT consulting, grew by 1.1 percent to 40.0 billion euros.

Telecommunications is expected to record moderate growth. In 2021, the market is expected to grow by 1.0 percent to EUR 67.4 billion after two years of consolidation. According to Bitkom calculations, telecommunications services will generate revenue of EUR 48.7 billion, representing a slight increase of 0.3 percent. Business with terminal equipment will grow to EUR 11.6 billion (+2.8 percent).

Investments in telecommunications infrastructure increase significantly by 3.2 percent to EUR 7.1 billion, Consumer electronics continue to be on a downward trend. According to Bitkom's forecast, sales in 2021 will fall for the fourth year in succession, albeit less sharply than recently. This smallest ICT submarket is expected to shrink by 2.0 percent to EUR 8.3 billion.

Previously strong employment growth is leveling off slightly in the wake of the Corona crisis. 20,000 additional jobs are expected to be created in 2021, after the number of jobs fell slightly by 8,000 to 1.2 million last year. In 2019, 58,000 new jobs had still been created. On a global scale, however, the German ICT market plays a subordinate role. Its market share is expected to be 3.9 percent in 2021.

The trend is downward because investment and spending are growing faster in other countries, particularly in the Asian region. The growth leaders are India (+13.5 percent) and China (+7.1 percent). To drive digitization forward in Germany, Bitkom is calling for a new digital policy agenda focusing on digital participation, digital sovereignty, digital sustainability and digital resilience in the super election year 2021 with ballots in the federal government and six German states.