Weekend Economists Kickoff the Season, September 6-8, 2013

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36. Suddenly Germany may be in trouble – too little growth, two few babies

http://www.theguardian.com/business/2013/sep/08/germany-little-growth-few-babies

On the edge of deep green mountain forests in the centre of Germany – where east once met west – lies Germany's "toy town". As in every corner of Germany right now, smiling election candidates beam out from posters tied to lampposts in Sonneberg with snappy slogans promising "safe jobs" and to "keep Germany strong".

There is little mention of looming problems that many experts predict will send Germany tumbling down the economic league tables over coming years. Instead, they are playing on the strengths of Sonneberg's mix of small and family-owned companies – the kind that dominate the buoyant German business landscape. Toy town is, for now, enjoying the latest of many resurgences through the centuries.

"Sonneberg and the area around it has one of the highest employment levels in Germany," says Christian Dressel, who runs the local job centre. "Businesses have set up here … we have car industry companies, electronics firms making vacuum cleaners and TVs, toymakers and a training school for toymakers."

In its heyday at the turn of the 20th century, Sonneberg was the world's leading toy producer. Mothers and fathers, son and daughters, crammed into home workshops and, with their neighbours, made up production lines that churned out every fifth toy in the world. One house would make dolls' wigs, the next along stuffed the bodies and another would craft their faces.