Small and medium-sized enterprises (SMEs) remain an important economic sector in Germany

SMEs are only one part of the Mittelstand. Accordung to the IfM-definition, It includes both – small and medium-sized enterprises and larger family businesses.

Oct 27, 2023, 12:44:13 PM
Dr. Jutta Gröschl, Institut für Mittelstandsforschung (IfM) Bonn

Nearly 3.4 million companies in Germany are classified as small and medium-sized enterprises (SMEs) according to the European Commission's definition of SMEs. This is more than 99 % of all companies in the business sector. With more than 2.4 trillion euros, SMEs generated more than 31 % of the total turnover in Germany in 2021, even with the economic consequences of the Corona pandemic. Overall, they contributed more than 49 % to the total net value added of all companies. The SME share of export turnover in 2021 was also only marginally lower than in the pre-pandemic period at 15.9 % (2019: 16.0 %). In total, SMEs exported goods worth almost 228 billion euros in the second year of Corona. To this must be added shipments of goods to private individuals residing in the European region and exports of services, which are not taken into account in the official statistics. Companies with fewer than 250 employees with social security contributions now employ more than 70% of all trainees - slightly less than in 2019. Overall, more than half of all dependent employees (19 million) work in small and medium-sized enterprises. The definition of Mittelstand enterprises includes both – small and medium-sized enterprises and larger family businesses The IfM Bonn defines Mittelstand companies only as those enterprises in which ownership and management are in the hands of a maximum of two natural persons or members of their families. Therefore, companies with more than 250 employees also belong to the Mittelstand if the family members still hold at least 50 % of the company shares and are actively involved in the management. As the qualitative characteristics of Mittelstand enterprises (Nature of management, ownership and economic independence) are not considered in the official statistics, the IfM Bonn calculates the economic significance of the MIttelstand based on the SME definition. Their contribution is higher because the contribution of the larger family businesses, in which ownership and management are unified, must also be added. The key figures on the economic significance of small and medium-sized enterprises in Germany are available on the homepage of the Institut für Mittelstandsforschung (IfM) Bonn (