How Does Germany Do It?

This article focuses on the economic share of manufacturing industry in Germany and the role of Fraunhofer–Gesellschaft in maintaining the same. A principal factor in the manufacturing success of German small- and medium-size enterprises (SMEs) is the Fraunhofer–Gesellschaft (Fraunhofer Society), an independent non-governmental organization that provides high-quality, short-term, affordable applied research that small- and medium-sized firms could not otherwise afford. Fraunhofer's model is a classic government–industry partnership. The federal and state governments, private contract research, and publicly funded contract research each provide roughly one-third of its funding. Germany's government has long supported the application of technology to manufacturing. Its ongoing support for large-scale practical industrial research for small and large companies has helped keep factories and jobs in Germany. There is a need to focus more resources on applied research to harvest the benefits of the investments the nation already makes in basic technology.