I should congratulate KDF33's logical analysis. His are the best set of posts I have read in this forum.
KDF33 wrote:Well, let's not exaggerate: to triple the amount of arms and ammunition produced, the Germans would need something like 5 million extra workers and 35 million extra tons of steel, to say nothing of the added factory floor, machine tools and, especially, coal production and transport capacity. I'm not doubting that the Germans could have achieved a much higher output absent the bleeding wound of the Eastern Front, but they wouldn't have transformed into the U.S.
To reiterate an important point: funding wasn't the only constraint on production.
Well, in terms of installed capacity, German factories had plenty to spare and that's not considering the rest of occupied Europe, whose installed capacity was very underutilized in the war. About 92% of German plants in 1942 were running on a single shift and the ratio of worker to machine tools in the machine tool using industries in 1943 was 2.3 in Germany compared to 5.6 in the UK. The German stock was the same as the US's, and that's not considering the industrial capital stock in occupied Europe. So technically, they were utilizing their metal working capital stock at ca. 40-50% of the US or UK.
The same applies for the steel industry, installed capacity in continental Western Europe was 47 million tons, plus 3 million tons in Italy plus ca. 9-10 million tons in the occupied parts of the USSR's, production in Germany and occupied countries was ca. 32-35 million tons or 55%-60% of installed capacity. While military steel consumption was ca. 1.5-1.6 million tons a month, and about 30-40% of it was allocated just to ammunition production in 43-44.
Overall, given the installed capacity an increase in labor supply would enable a vast increase in war related production. And by may 1944, the Wehrmacht had lost 3,285 thousand men of which 180 thousand were before the invasion of the USSR and had 2,510 thousand in the Ersatzheer training and recovering from wounds. Without the Eastern front to worry about the Ersatzheer would have ca. 1.2 million men like in 1941, so without the Eastern front losses of ca. 3.1 million and manpower training and recovering from wounds, that's an extra 4.3 million men in the labor force.
For comparison, the machine tool using sector had 5,250 thousand employees in june 1944 plus ca. 600 thousand in steel, iron and aluminum production and all other metals, that's 5.85 million in basic metals plus metal working+non-metal working machine tool using sectors. According to Tooze (2005), out of the 2.2 billion RM of monthly expenditures on military equipment (of which 1.8 billion were in the official "armaments index") by the Wehrmacht in the 3rd quarter of 1943, 2.1 billion or 95% of these expenditures were from the metal working sector.
Also, in terms of expenditures in 1945 dollars, in 1944 the US spend 28 billion dollars on ships and aircraft while total government expenditures were 93 billion dollars in the 1943-44 fiscal year, so 30% was spent on aircraft and ships only and I am using 45 prices which were lower than 44. German metal working sector sales of aircraft and shipbuilding in 3rd quarter 1943 was 825 million RM (720 aircraft, 105 shipbuilding) while total government expenditures were 12 billion RM monthly from September 1st 1943 to August 31 44, that's 7% of government expenditures. I should also note that expenditures figures here are in (current) 1943 prices.
As a result employment in aircraft (780) + shipbuilding (150) in Germany in 4th quarter 1943 was 930,000 while in the US by the 4th quarter of 1943 had 2.1 million in aircraft and 1.7 million in shipbuilding, or 3.8 million in both sectors, about 4 times larger.
Overall, without reducing the size of the field army and just allocating manpower from the Erzatzheer and loses from the Eastern front would increase basic metals plus metal working labor from 5.75 million to 10 million, an increase of 75%. Total sales of metal working sector historically were 4 billion RM with 4.8 million workers, with 8.8 million workers total sales would almost double to 7.3 billion RM while Wehrmacht related sales would increase from 3.05 billion to 6.25 billion RM (including intermediate goods, military output was 75% of 100%, now increasing total output to 180% means military output would more than double to 155%), increasing total armament output by 105% from historical levels and increasing final military equipment sales to 4.5 billion RM from historical 2.2 billion RM. If the fraction of armament sales of ships and aircraft increases from 38% to 55%, that's 2.5 billion RM or 3 times the historical levels of 3rd quarter 1943, while other armament sales would increase from 1.4 billion to 2.0 billion, a 40% increase in tanks, ammunition, guns and motor vehicles. Manpower in aircraft and shipbuilding industry would be ca. 2.7 million, or nearly to 3/4 of US's manpower.
While steel production could be increased by 13 million tons just from utilization of installed capacity in occupied Western Europe, that's 1.1 million tons a month extra for the military, increasing military steel supply by two thirds from historical levels.
Most of this 4.3 million men manpower would be directed to the aircraft and shipbuilding industries. Increasing the proportion of government expenditures in these sectors. If they increased to similar level in proportion to the US's that would be ca. 30% or 3.6 billion RM monthly, requiring an increase the labor force in those sectors by 3 million workers to ca. 3.9 million workers, however just from Eastern front losses and Erzatzheer manpower Germany could get that labor force. The other 1.3 million men would work in production of raw materials, electronics and other supporting industries such as synthetic aircraft fuel plants, although a few hundred extra thousands would be probably needed for the intermediate level industries. Overall Wehrmacht purchases from German metal working sector would need to increase massively from 2.1 billion RM to ca. 5.8 billion RM, that's it if 30% of all government expenditures were just aircraft and ships without increasing expenditures on other items (quite absurd indeed, but civilian related sales of the metal working were only 1 billion RM, so keeping civilian output constant would mean that ca. 6.5 billion RM in sales of the metal working sector would go directly or indirectly to supply the Wehrmacht in intermediate sectors). If just 1/3 of direct Wehrmacht expenditures were aircraft and ships, that would be 2.7 billion RM a month, requiring an workforce of 3 million in these sectors (perhaps a more realistic figure). Still that appears to be quite too much, so an increase of 3 fold for aircraft and ships appears more sensible.
In 2nd quarter of 44, when industrial employment peaked, there was only 1 million workers in aircraft production and shipbuilding. Without the Eastern front there would be about 2.8 to 3.9 million workers in those two sectors and output would be perhaps 2.5 to 3.5 times it's historical level. Aircraft output could be 1,700 to 2,200 million RM or 6,000 to 7,500 aircraft monthly or 70,000 to 90,000 aircraft per year and shipbuilding would be 900 - 1,400 million RM or around over 10 times historical levels.
By the way, a price of a 2 engine bomber was ca. 250,000 RM in Germany 1943 and ca. 150,000 dollars in the US 1943, while total government expenditures were 149 billion RM in 09.43-08.44 in Germany and 93 billion dollars in the US 07.43-06.44. I don't know from where Germany took that much money from (tax revenues in Germany were ca. 46 billion RM in 1943, while tax revenues from occupied western Europe was 24 billion RM).
Without the Eastern front I don't see labor, capital or financial barriers to massive increase outputs in these sectors. Maybe raw materials and specially oil for aircraft and ships would be the fundamental limiting barrier. But overall, something like doubling aircraft output from historical levels would be expected.
Sources for figures:
USSBS Report German War Economy
No Room for Miracles (2005), Tooze
Germany and the Second World War vol. 5
The World Economic Survey 1942-1944
"In tactics, as in strategy, superiority in numbers is the most common element of victory." - Carl von Clausewitz