Stuttgart – The Swabian metropolis (Schwabenmetropole)
Stuttgart is the capital city of the state of Baden-Württemberg in southwest Germany. Located near the River Neckar, the city covers an area of 207.33 km2 (80.05 sq mi). On December 31st, 2020, official government statistics estimated the population of Stuttgart City at 630,305, with a density of 3,000/km2 (7,900/sq mi). The estimated population in the urban area is 2,787,724 (est. December 31st, 2018). The estimated population in the metropolitan region is 5,300,000 (est. 2015)
The city is situated at the heart of the Stuttgart Region, which comprises the capital and five counties. The region has an estimated total population of 4,151,094 people, with a density of 410/km2 (1,100/sq mi), from 170 different countries.
The official spoken language is German, although as the city is home to a large population of foreigners, English, Turkish, Italian, Greek, and Croatian are also spoken.
The city is subdivided into 23 city districts, five inner and 18 outer districts. The district councils are advisory only and are managed by the city council led by the city mayor. Stuttgart’s current mayor is Frank Nopper, elected on January 4, 2022, a member of the Christian Democratic Union of Germany (CDU). Before the election, Frank Nopper held the position of the Lord Mayor of Backnang from 2002 to 2021.
Stuttgart Economy
Stuttgart has established itself as a dynamic economic center of Germany and is widely renowned for its strong industry and business sectors, innovative technology, and high quality of life. Stuttgart’s regional GDP is €213.4 billion (est, 2018), with an estimated per capita income of €47,400 per inhabitant.
Stuttgart’s tertiary sector is its most prominent, followed by industry and agriculture. The city is most widely known for its high-tech industry and hosts several international companies, including Daimler AG, Porsche, Bosch, Hewlett Packard, and IBM.
As the birthplace of Gottlieb Daimler (the inventor of the motorcar) and consequently the automotive industry, the region continues to be one of Germany’s critical automotive locations, where vehicle design, production, and engineering all play a vital role in the local economy.
The city is also one of Germany’s leading financial centers, home to Germany’s second most important stock exchange.
The region is also renowned for its Research and Development expertise, home to the highest density of universities, institutes, and research facilities.
Other notable industries include creative services, clean energy, information and communication, electrical engineering, and media.
Stuttgart Infrastructure
Stuttgart’s southern location makes it a central transportation hub for goods across Germany and beyond. The city is linked to other major cities and neighboring countries by a network of well-maintained Autobahns (A8, A81, and A831) and railways.
The city center operates a modern and efficient public transport system that consists of a U-Bahn, S-Bahn, and buses. Stuttgart’s U-Bahn and S-Bahn systems form the backbone of public transport moving passengers throughout the metropolitan area and beyond.
Stuttgart’s central railway station or Hauptbahnhof moves over 220,000 passengers per day and operates frequent Eurocity and Intercity trains to Hamburg, Frankfurt, Berlin, and numerous other European cities, alongside extensive regional services to surrounding areas. The central station is undergoing the first stages of the Stuttgart 21 project, which will eventually convert the existing station to an underground through the station.
Stuttgart is served by Stuttgart International Airport, situated 13 kilometers from the city center. The airport moved 11,832,634 passengers in 2021, and 19,083 tonnes of freight to destinations worldwide.
Stuttgart also has an inland port in Hedelfingen, allowing cargo to reach important ports of Rotterdam and Antwerp in just over 48 hours.
Stuttgart Workforce
Stuttgart region had a total estimated workforce of 1.4 million people. The majority of the workforce is German, with around 22% comprised primarily of Turks, Italians, Greeks, Croatians, Serbs, and Slovenians.
Stuttgart’s largest employer is the automotive sector, with around 50% of the region’s economic turnover coming from auto-related industries. Total Manufacturing accounts for some 40% of employment in the city, while Finance, Media, and ICT play a crucial role. It is estimated that 24% of the workforce is employed in hi-tech jobs.
Stuttgart’s highly skilled workforce results from the city’s well-established public education system. Although not one of Germany’s largest university centers, the city has many universities, technical colleges, and other academies such as the University of Stuttgart, with 25.705 enrolled students (est. 2018), the University of Hohenheim, with 9.638 enrolled students (est. 2016), the State University of Music and Performing Arts, with 863 enrolled students (est. 2020), and the University of Applied Arts, with 840 enrolled students (est. 216).
Stuttgart consistently enjoys the lowest levels of unemployment versus other German regions. In December 2021, official statistics estimated unemployment at 5.3%, well below the national average of 7%
Business Costs in Stuttgart
Germany’s individual income tax rates work on a 0% – 45% progressive scale.
Corporate tax is charged on corporate enterprises, particularly public and private limited companies and other corporations, e.g., cooperatives and foundations. In addition, businesses are expected to pay a solidarity tax of 5.5% and a trade tax. The standard corporate rate in 2021 was set at 15% but combined with the additional taxes. The effective corporate tax rate is about 30%-33%.
The standard VAT rate in Germany is 19%, while a reduced VAT of 16% can be applied to food and agriculture products.
From January 1st, 2021, the minimum wage is 9.50 euros per hour worked and from July 1st, 2021, the minimum wage is 9.60 euros per hour worked. Since 2020, the minimum wage rate in Germany is around 1.584,00 EUR net.
The estimated office rental in the Stuttgart CBD at €13.60 per square meter per month.