Volker Giersch: Successful transformation into a modern location for technology and services

Going largely unnoticed, Saarland has developed into one of Germany’s ri­­chest regions of growth and innovation. Half a century after the economic integration into the Federal Republic, the small­­est of the German territorial states de­­veloped in­­to a modern location for in­­dus­try and services in the heart of Europe.Today, Saarland stands in the forefront of the federal states with respect to the most important economic indicators. In the current decade, it lies in place three of the country ranking be­­hind Ba­­varia and Saxony with regards to economic growth. The development of work places is bet­­ter here than anywhere else in Germany. Unemploy­ment is sig­­­­nifi­cant­­­ly lower than the average coun­­try rate. And with regards to pro­­fessional train­­ing, the state can even boast a top-ranking position.
Following a profound transformation, it has a broad economic structure. In the coal and steel in­­dustries, which secured the wellbe­­ing of the state for many decades, around 80,000 workplaces were lost in radical crises that took place from 1960. Thanks to continuous revaluation of the location, an attractive research landscape and successful industrial establishments, these losses could largely be counterbalanced through new jobs in the processing industry, the tech­­nologi­cal sector and in the field of services.

Successful industrial establishment
The basis for successfully overcoming structural difficulties was the success of exemplary establishments. Ever since the economic integration in 1959, a total of more than 200 industrial com­­panies were established, which today employ over 40,000 workers. In many cases, these are branches or subsidiary com­­panies of larger national and in­­ter­­na­­ti­­o­­nal groups. After their start-up, many companies very quickly built up their capacities. Saarland’s econ­­omy-­friendly environment provided the breeding ground for this. In the state of Saarland many production plants could develop more positively than allied companies lo­­cated in other regions.
Many were even raised in position to “model production facility” within their group.



An attractive environment for investments and innovations
Fundamental impulses for growth and structural change are provided by in­­vest­­ment aids within the context of regional economic development, and this until today. The job market is making a significant con­­tribution to the Saarland as a business location – especially the good availability of highly qualified and experienced workforce.

A deciding point, of course, was also that the disadvantages of the national border situation lost more and more signif­­icance with Europe’s increasing econom­­ic integration. Through the completion of the Single European Market and the Economic and Monetary Union (EMU), Saarland in­­creasingly profits from the advantages of its central location. In ad­­dition to this, the increasingly better in­­­tegration of the state into European road networks enables it to reach the most important European markets quickly and cost-efficiently. One can reach Paris from Saarbrücken, for example, via speed train (ICE/TGV) in less than 110 minutes. Saarbrücken and Zweibrücken airports offer cost-ef­­ficient direct fights to Europe’s most im­­portant metropolises. Thanks to the good integra­­tion, one can also reach one’s destination quick­­ly via car by the motorway network.
Another great trump card for the region are Saarland’s universities with their 20,000 students and also the nearby research institutes. Included here are, for example, the Max Planck Institutes for Computer Science and Soft­­ware Sys­­tems, the Fraun­­hofer Institutes for Non-De­­struc­­­­­­­tive Testing (IZFP) und Biomedical Engi­­neering (IBMT), the Leib­­niz Institute for New Materials or also the German Re­­search Center for Artifi­cial Intelligence (DFKI). By now, around 200 technology-oriented companies stem from universities and institutes.

Modern technologies around the subject car …
The face of industry has considerably changed over the past few decades through the process of structural trans­­for­­ma­­tion. Whereby it is more than ever true: in­­dus­­try is high-tech.

Today above all, Saarland’s infrastructure of industry is characterised by the vehicle construction and component sup­­plying in­­dustries. Thanks to the reasonable product combination, this sector has remained the most important job motor on the Saar up to present times. Be­­side the Ford works, which were established in Saarlouis towards the end of the 60s, renowned suppliers, such as Bosch, Nemak Dillingen, Eberspächer, Decoma, ZF-Getriebe or Johnson Controls, contri­bute towards Saarland’s automobile industry.

These finish high-quality components for vehicles of all types in modern production plants – diesel in­­jec­­tion pumps, aluminium engine blocks, mufflers, ex­­haust emission pu­­rifica­tion in­­stal­­la­­ti­­ons, profile door frames, bum­­p­­ers and automatic trans­­missions. Also included, are production plants of leading tyre producers (like Michelin) and medium-sized suppliers within the automobile industry. All in all, today, every third industrial work place in Saarland is directly or indirectly dependent upon the automobile. It is therefore with some jus­tification that one speaks of “Saarland car land”.



… and in other industries
Holding 11,700 workplaces, the ma­­chine construction industry is the second larg­­est industrial employer on the Saar, with the profile in this sector hav­­ing been greatly transformed over the past few decades – from former coal and steel supplier to world-wide supplier of in­­no­­vative production technology. The span of products focuses on the areas of special engineering, test stands, dynamometers, measuring and control engine­e­­r­­­ing as well as CIM components. Saar­land’s steel industry has experienced a true renaissance.

Since the turn of the millennium, it again counts as one of the strongest growing sectors in the state, thanks to a consistent focus on high-quality steel and in­­novative pro­­cess technology. Signi­­fi­­cant branches of industry are also the foundries, steel and plant construction, steel forming, electrical engineering, ener­­gy and environmen­­tal technology and medical technology.

Further priorities in the Saar industry are the food economy and the consumer goods industry, including Eu­­rope’s largest ceram­­ics producer, Ville­­roy & Boch.

Service providers on their way up
Dramatic expansion in Saarland can be seen in the service providing sector, above all within the area of company-oriented services. The information tech­­nology and the consulting sector posted also dynam­ic growth, which presently has around 6,000 employees. Con­­sider­able growth rates can also be shown by the environmental and medical service pro­­viders and the insurance sector, which gained partic­­ular impetus through the market success­­es of direct insurers Cos­­mosDirekt and Union Kranken­ver­­­si­che­­rung AG (UKV).

Despite all of these successes, a lot still remains to be done, for as we well know, nothing is as consistent as (structural) transformation.


PotraitThe author is the main business executive of the Chamber of Industry and Commerce of the Saarland (IHK). Born in Müns­­ter/Westphalia, in 1950, he studied eco­­no­­m­­ics in Saar­­­brücken and, among other things, lat­­er worked as a scientific expert at Saarland’s state chan­­cellery. The year 1979 brought his ent­­ry into the IHK as an expert for fundamen­­tal questions, land planning and industry and in 2000 he was appointed main busi­­ness executive.