German Companies Criticize Federal Government's Economic Policies in 2026

German companies have expressed strong dissatisfaction with the federal government's economic policies in early 2026, according to recent surveys by the Ifo Institute in Munich. Overall, businesses rated the government's performance poorly, with an average score of 4.2 on a six-point scale where 1 is very good and 6 is insufficient.

The harshest criticism targets the government's social and pension policies, which received a dismal average grade of 4.6, indicating significant shortcomings. Other key policy areas such as labor market, industry, energy, and climate policies were rated only 'satisfactory,' scoring between 4.1 and 4.2. Finance, infrastructure, and digitalization policies received marginally better evaluations at 4.0, yet these also fall short of expectations.

The dissatisfaction cuts across industries with little variation; no sector assigned a positive rating to the government's economic policy. Significant company priorities include reducing bureaucracy and regulation, which 40.4% of respondents highlighted as urgent. Additionally, 37.1% called for tax reforms involving tax cuts and simplification of the tax system. Other areas of concern include labor market and skilled labor issues (24.6%), energy policy (23.3%), and investments and infrastructure (21.3%).

Klaus Wohlrabe, head of Ifo surveys, emphasized that companies see minimal progress in addressing critical economic challenges, resulting in a predominantly negative assessment. He stressed the business community’s demand for tangible policy improvements rather than mere announcements.

This widespread corporate critique underscores growing tensions between Germany's federal economic policy direction and the needs and expectations of its business sector, pointing to potential pressures on the government to accelerate reforms in social security, labor, regulatory, and economic frameworks moving forward.