Trends and facts: Economic development in the Hannover Region

Hanover Region

The Hannover Region is facing new economic challenges, but there are also positive developments in important sectors. This is shown by the annual analysis "Trends and Facts", which has now been presented by the Hannover Region's Economic and Employment Promotion Agency. Regional President Steffen Krach: "The analysis is an important basis for the development of our economic region. If you know which adjustments need to be made, you can tailor the measures better. The figures show where we are already doing very well and where we need to do even better."

Tense situation on the labor market

The situation on the labor market in the Hannover Region is tense. The unemployment rate has risen to 8.3% - in 2019, it was still at 6.4%. Young people aged 15 to 24 are particularly affected, with an unemployment rate of 7.1%, which is above the pre-crisis level. Employment demand is also weakening further: according to the IHK economic survey, a third of companies in the Hannover Region are no longer reporting any staffing requirements, 30% are planning to cut costs and only 13% want to hire new employees - the lowest figure for over 15 years. At the same time, the proportion of companies that are unable to fill vacancies has fallen to 48% (previous year: 60%).

Employment growth weakens

The number of employees subject to social insurance contributions in the Hannover Region rose by around 73,000 to 543,200 between 2014 and 2024. The average annual growth rate of 1.5 percent is therefore in line with the national and Lower Saxony level. Employment grew particularly strongly in the north-eastern municipalities of the Hannover Region. From 2023 to 2024, however, growth remained below the pre-crisis level at 0.5 percent (+2,500 employees subject to social insurance contributions). While rural municipalities such as Wedemark and Burgwedel recorded growth, there was a decline in employment in larger employment locations such as Lehrte and Garbsen.

The number of employees subject to social insurance contributions in the leading sectors has risen by an average of 1.7 percent over the past eight years. In the following key sectors, the number of employees in the Hannover Region is above the national average:

• Energy industry (5 % annual average (AY), +1,900 full-time equivalents),
• Logistics (2 % JD, +9,400 full-time equivalents),
• Automotive (1 % JD, +1,900 SvB) and
• Financial and insurance services (0.4 % JD, +800 SvB)

Despite an increase of 13,000 additional employees subject to social security contributions (2.2 % YTD), the healthcare industry, which is strong in terms of employment, grew at a slightly above-average rate. The leading sectors in the Hannover Region showed below-average development compared to the national trend

• Science and research (1.3 % JD)
• Information and communication (1.4 % JD),
• Knowledge-based business-related services (2.2 % JD)

In addition, the structurally defining sectors such as automotive are undergoing a radical transformation in which no further employment growth is currently expected.

Head of Economic Affairs Ulf-Birger Franz: "As an economic and employment promotion agency, we have to ask ourselves the key question of how we can support companies in taking a sustainable path into the future. We are already supporting the transition to new business models with projects such as the neu/wagen network. Hannover must become stronger in the areas of IT and research and development. That's why we as the Hannover Region are on the right track when technology parks like the one in Garbsen take over. We have a lot of potential and want to make even more of it."

Negative trend in trainee numbers halted for the time being

The Hannover Region has an outstanding role as a training location and Hannover attracts mainly younger age groups from the rest of Lower Saxony. Around 85,000 young people are currently studying or training. However, the demand for vocational training continues to decline: the number of vocational school students has fallen by 11% since 2019 to around 36,000. However, this downward trend was halted for the time being in the 2023/24 school year, with growth in technical and healthcare professions in particular. The number of students at universities in the region was around 49,000 in the 2023/24 winter semester - a decrease of six percent compared to 2019/20.

Alexander Skubowius, Head of Economic Development in the Hannover Region: "The challenge remains not only to attract young people to the region for training and studies, but also to retain them in the regional labor market in the long term after they graduate. This is why employment-promoting measures, such as the program against youth unemployment or the Welcome Center for foreign skilled workers, are a key component in securing the long-term demand for skilled workers."

Overnight stays back at a high level

Tourism in Hanover has recovered from the coronavirus years and recorded a total of 4.03 million overnight stays in 2024 - a figure on a par with 2018 and 2023 and the fourth-highest of all time. The state capital Hannover set a new record with 2.38 million overnight stays, while 1.65 million guests stayed overnight in the surrounding area. This means that the Hannover Region remains a popular travel destination with stable demand.

Regional President Steffen Krach looks ahead: "As the Hannover Region, we are using all the options available to us to strengthen the economy. However, we need more support from the federal and state governments in order to make tangible progress again. If the Bundestag votes in favor of the special fund for infrastructure, this can also provide a boost for infrastructure and the economy in the Hannover Region.

"Trends and Facts" 2024 is available to download here as a PDF brochure.