It is not the first time that Berlin is growing
Berlin is in a phase of a transformation again. The first time the city crossed the mark of 100.000 residents was in the 18th century. With the industrialization another wave of population growth set in hand in hand with an economic boom in the first half of the 19th century. People started moving to Berlin hoping for a better life in the big city. Berlin had become a megapolis at the end of the 19th century and counted 4,32 million residents in 1939.
The city is facing new challenges but also opportunities around 80 years later with a repeated burst of population growth. Berlin has become one of the hippest and most popular cities of the world thanks to its attractiveness as a location for cultural, creative and media institutions and businesses.
On the one hand the city was surprised and sometimes overwhelmed with the sudden influx. On the other hand it opened up many new chances.
Berlin owes its economic success to the high-performing research and science landscape as well as the qualified workforce. The city is the home and workplace of choice to national and international residents. More than half of Berlin’s residents were not born here, which is not a disadvantage, moreover it shows how attractive the city is. Berlin should use and develop its drawing power and positive vibes. The positive developments are also depending on the know-how of the qualified workforce, which needs the internationality and openness. In 2016 the city climbed all the way up to rank 16 of the Global-City-Index in regard to the attractiveness for workers, ideas and capital of a city. In order to climb up the ladder of the Global-City-Index even further, goals such as the openness for new developments, the melting of old and new, promoting the common Berliner identity and the social variety have to be reached.
Baby-Boom and immigration
Berlin is approaching the 4-Million-city mark with a continued growth of population for the past 12 years. Reasons for such developments are the immigration from outside the city and increasing birth rates since 2005. According to the Department of Statistics Berlin Brandenburg about two-thirds of all new Berliners are between the age of 20 and 30 years. There is a correlation between the rising birth rates and the immigration of a young population with potential mothers. Since 2006 the death rate has been topped by the birth rate. In 2016 the highest birth rate with 4.660 newborns has been registered in Pankow, whereas the lowest rates have been registered in Spandau and Reinickendorf. With an average age of 29,7 years, the youngest mothers of the city live in Marzahn-Hellersdorf (2016).
Pankow does not only have the highest birth rates of all Berliner districts, it also has the highest number of toddlers with 18.354 children between the age of 0 and 3 years in 2016. Other districts with many children between those ages are Mitte (15.196 toddlers) and Neukölln (13.438 toddlers). Many families value the local opportunities for shopping and daily needs. Residents benefit from short distances and the compatibility of the city. 45,9 percent (2015) of families in Berlin make use of child care, which is above the average in Germany (32,7 percent). The option of combining a job and family surely is an advantage of the capital city.
The city for all generations
The Youthful-Cities-Index 2015 shows how attractive Berlin is for young people from all over the world. Berlin is on position 3 of 50 cities worldwide. Reasons for the popularity among young people are the various universities, colleges and company training centers as well as many recreation options, parties and events. Also important: running costs are low in the international comparison. Forecasts predict that the proportion of 18 to 25 year olds will neither significantly rise nor increase until 2030 (source: SenStadtUm). Same goes for the proportion of the working population between the ages of 18 to 65.
Attractive for old and young people
The Access City awards proves how comfortable old people feel in Berlin, since the city has been awarded for its accessibility in 2013. Of all Berliners around 10 percent could not live without the accessibility and 40 percent see it as a necessary support in their daily life. Berlin is the ideal location for older generations thanks to the well-developed public transformation system and the density of shopping opportunities and other institutions for the daily needs in most neighborhoods.
The chart above shows the non-employable population between 0 and 18 years in Berlin’s districts. Nevertheless, it is not a picture of the non-employable population in general because teenagers are already allowed to start working before they turn 18 (source: Federal Institute for Population Research). We are using the youth-quote for our calculations in order to estimate how the young population group is depending on the population group of employable age.
The old-age quote includes the non-employable population and have been set in relation to the age (workable) age group of 19 to 64 years The calculation includes all residents of each district over 65 years. The labor-force participation rate includes the population between 19 and 64 years. This quote is the highest in the district Friedrichshain-Kreuzberg, where almost one-quarter of all residents is between 27 and 35 years old. In comparison to the old-age quote and the employment-quote, the youth-quote is distributed quite evenly. Out of all districts, Spandau reaches the highest youth-quote in Berlin.
Berlin: cosmopolitan metropolis
Berlin is a multicultural city, which is characterized by its diversity and individual lifestyles.
Around 30 percent of Berlin’s population has a migration background. The senate has been supporting integrational programs for migrants for over three decades now. Other important fundaments are the self-organized associations and programs for and by migrants, which depend on the voluntary service. The integration programs include guidance, education, job-related orientation, self-employment and political participation.
Historic flashback on the “immigration city”
Berlin started to turn into an immigration city in the 17th century. The rapid development of the royal capital went hand in hand with settling privilege of Jewish families. The extreme growth of population during the boom of the industrialization in the 19th century can be explained with the high immigration rates of workers from the former Prussian part of Poland. Additionally to that around 300.000 Russian refugees of the communist revolution and civil war in the former Russian czardom looked for shelter in Berlin.
The very darkest time of Germany’s and Berlin’s history of immigration is the time of the Nazi regime and persecution of Jews. When Adolf Hitler took over the power on January 30th, 1933 around 170.000 Jews lived in Berlin. Only 6.500 of them survived the mercilessness and absolute cruelty of the Nazi regime. Around 40 memorials in Berlin remind us of the terrible destiny of all those hunted, expelled and murdered during this time.
Between 1945 and 1989 different migration and integration programs were introduced, depending on the political and economic orientation of the part of the divided city. Immigration and layovers of foreigners were controlled by the government in East Berlin. Since 1967 only foreign workers from befriended, socialist countries were accepted. They usually had to live isolated from the German population. In contrast to that, West Berlin accepted guest workers on a large scale due to the labor shortage after the construction of the Berlin Wall in 1961. From the mid-60s until 1973 before the oil embargo, often less qualified industrial workers from south European countries and Turkey were recruited. The migrant laborers often brought their families to Germany as well, which led to a transformation of West Berlin’s inner districts. The workers moved to districts such as Wedding, Neukölln and Kreuzberg, which were cheap by that time. It was the start of immigration milieus, which are highly valued by many old and new Berliners today.
Focus on social environments
The apportionment of migrants in Berlin’s districts is uneven and depends on the district and neighborhoods. This goes back to historically divergent developments before the German reunification. The proportion of migrants is still three times higher in the former West Berlin than in the former East Berlin. The district Mitte counts the highest number of residents with migration background with almost 50 percent in 2015. Most of the migrants are from Turkey (22,03 percent), who are also the largest group of migrants in Berlin in general (172.670). The second largest group of migrants comes from Poland (102.300) and the third largest from the former Soviet Union (108.200). Depending on the proportion of migrants and the country of origin, different social patterns can be recognized in the districts and quarters. Steglitz-Zehlendorf for example counts the highest number of Americans. They still feel a strong connection to the district because Zehlendorf used to be the American headquarters and base for the majority of American soldiers until 1994. Most residents with a Polish migration background live in Neukölln, whereas most Italians, Spanish and French choose Friedrichshain-Kreuzberg.
Changing lifestyles: individualism and pluralization
With more than 50 percent of all households being single households, Berlin is the city of singles. About 41 percent of single households are over 65 years old. Due to the rising life expectancy, this age is probably going to rise in the coming years, which will have an impact on the welfare system and the housing market. The most single-person households were registered at Reuterkiez with around 69 percent (2016).
Besides being the city of singles, Berlin is also the city of single parents. The classical picture of a family is replaced by the individualization. In 2015 Berlin registered 6.427 divorces. 50,8 percent of all divorces were requested by women. Around one-third of all children, who are younger than 18 years, are living in a single parent household. The highest number of single parents has been registered in the neighborhood around Pankow Center (2015).
Different types of living
With the social change, which is characterized by a transformation of lifestyles, values and interests, specific locational aspects have to be considered by the real estate industry depending on the type of household, age and social background. This basically means that singles tend to move closer to recreation and cultural hotspots than families, who usually prefer living in green neighborhoods often closer to the city border. Additionally provided childcare is an important locational factor for families. Another aspect is the age of the people living in a household. Other than it used to be, the 50- 65 year olds are showing an increasing interest in the inner city locations. This goes back to a common pattern of reurbanization in Berlin: as the children become adults and move out, the house in the suburbs seems too big for the aging parents. The idea of living central in a suitable apartment becomes more attractive. This process can even be monitored on a larger scale. Many (potential) buyers from other federal states of Germany are looking for a new home in Berlin. On your request we develop numerous living trends and forecasts on a micro level.
The city of science
The future of Berlin lies in the hands of scientists, workforce oriented college degrees, excellent universities and business and research locations. More than 50 percent of Berlin’s labor force has best qualifications, which is the highest proportion all over Germany. Berlin offers the ideal living and working conditions for the lifestyle of the creative, intellectual and urban population.
Berlin is the biggest University City in Germany and offers a variety of research and development institutions. A record of 175.917 enrolled students has been reached in the winter semester 2015/16. More than 200.000 employees are working at 47 federal and private schools or colleges. The most academics of the future are studying at one of the four big Universities in Berlin (Freie Universität Berlin, Humboldt-Universität, Technische Universität and Universität der Künste).
Economic boom for everyone?
The unemployment rate is constantly decreased since 2009 thanks to the economic boom of the city. The percentage went below 10 percent in 2016 for the first time since the German reunification. The unemployment rate decreased about 50 percent within only 10 years.
The economic development of the past years is quite impressive: Berlin’s economy grew about one-third between 2005 and 2013. This positive process goes back to the qualified skilled personnel. Unqualified people often remain unemployed.
Berlin is the city of start-ups, with establishments every 20 hours. This makes Berlin the leading start-up location in Germany. The investment volume of start-up entrepreneurs was 1,07 billion Euros high in 2016.
Social disparities in spite of the economic and establishment boom
There are also negative developments in Berlin: child poverty, precarious working conditions and segregation. Child poverty often affects children with single parents. The number of people living in Berlin, who cannot afford a living without any additional governmental aid, is high. 120.000 people were dependent on welfare in 2016.
Such developments are contrary to the increasing unemployment rate and economic boom. Especially the service sector and start-ups are opening chances for new jobs, which are often given to qualified newcomers. Those depending on transfer payments for years already have a hard time finding a new job and are not really benefiting from the economic boom of the city.
What Berliners earn
Most Berliners make their money in the service sector and are often not getting paid well enough. This explains why Berliners are earning less compared to other areas in Germany (see chart below). Nevertheless, just as the economic growth in Berlin the income in general increased constantly over the past years. Consequently the demand of the upper and luxury segment is going to increase in the coming years as well.