Companies remain cautious: medium-sized companies are putting the brakes on investments

There would be money available, but many medium-sized companies are holding back on new projects. High costs, bureaucracy and the uncertain economy are increasingly slowing down the willingness to invest.

Small and medium-sized companies in Germany continue to find it difficult to invest. Just 40 percent of all 3.9 million medium-sized companies will have implemented investment projects in 2025, according to an analysis by the development bank KfW. Things are also stalling this year: a third of companies (33 percent), more than ever before, said in a survey in September that they had postponed investments planned for 2026 or had implemented them to a lesser extent.

There is often no lack of financial opportunities to invest money in digitalization, new systems and energy efficiency, explains KfW chief economist Dirk Schumacher on the results of the latest “KfW SME Panel”. "The bad news is: Too many companies are not investing at all or are investing too little. They are postponing investment projects. This is problematic for Germany as a business location."

According to the analysis, in total, small and medium-sized companies in this country invested a nominal amount of around 218 billion euros in new systems and buildings in 2025, three billion euros less than a year before. Adjusted for price increases (real), according to KfW calculations, the new investment volume was in the red for the third year in a row. From 2019 to 2025, corporate investments in Germany fell by 8.3 percent after price and calendar adjustments.

According to the September survey, companies see high prices for energy, materials and wages as the biggest obstacles to investment. But uncertainty about future economic developments and bureaucracy are also slowing things down.