Brandenburg restaurant sales posted a deeper 10.9% real drop in August

Restaurants in Brandenburg posted a deeper drop in sales in August even as they employed more people than a year earlier, according to provisional official statistics released in November.

Inflation-adjusted restaurant sales in the eastern German state fell 10.9% from August a year earlier. That was worse than the 10% real decline recorded in July, a deterioration of 0.9 percentage point. In nominal terms, which are not adjusted for price changes, restaurant revenue fell 3.3%, while employment in the sector rose 2%.

The figures point to a growing gap between sales measured in current prices, sales measured after stripping out price effects, and staffing levels. The data show that restaurants were taking in less revenue than a year earlier and an even steeper drop in real activity, while still keeping more workers on payrolls. On their own, the numbers do not show why that happened or whether profit margins or productivity changed, but they do show that operating conditions remained under pressure.

For the first eight months of the year, real restaurant sales in Brandenburg were down 7.9% from the same period a year earlier. The published data did not include absolute euro amounts. The figures were presented as percentage changes and index values based on net revenue excluding value-added tax.

Across Brandenburg’s broader hospitality sector, which includes more than restaurants alone, the pattern in August was weaker sales and slightly lower employment. Real sales for the sector fell 7.5% from a year earlier, while nominal sales declined 1.3% and employment edged down 0.8%.

That means restaurants performed worse than the hospitality sector as a whole on the key measure of real sales. Restaurant employment, however, moved in the opposite direction from the wider sector, rising even as overall hospitality employment slipped.

The data relate only to Brandenburg, the state that surrounds Berlin, and should not be treated as a picture of Germany as a whole. The regional results reflect local market conditions in that state.

A report by Niederlausitz Aktuell highlighted the figures on Thursday, November 5, citing the official statistical release. The official report described the data as provisional.

The distinction between nominal and real sales is central to reading the numbers. A nominal decline of 3.3% means restaurants brought in less revenue in current prices than a year earlier. The much larger 10.9% fall in real terms means the drop was sharper after adjusting for price changes. In practical terms, that suggests the volume of business weakened more than the nominal figures alone indicate.

The employment increase adds another layer to the picture. A 2% rise in the number of people employed, alongside falling sales, can reflect several conditions, including efforts to retain staff after earlier labor shortages or a slower adjustment of staffing than of demand. The published data do not break down those reasons.

What the figures do show clearly is that the downturn in Brandenburg’s restaurant trade intensified in August compared with July. The worsening from a 10% real decline to 10.9% came at the same time that the sector continued to carry a larger workforce than a year earlier.

For the wider hospitality market in Brandenburg, the August numbers were also negative, but less severe on the sales side than those for restaurants. Real sales for the full sector were down 7.5%, compared with the 10.9% decline for restaurants, while nominal sales were down 1.3%, less than the 3.3% fall seen in restaurants. Employment for the full sector slipped 0.8%, in contrast with the increase in restaurant jobs.

Because the statistics are provisional, they may be revised in later releases. Even so, the August report adds to evidence that Brandenburg’s restaurant businesses were facing a difficult summer, with weaker inflation-adjusted revenue and staffing levels that did not fall in step with sales.