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Berlin has a very large tech industry, a lower cost of living, and lower wages.

Depends how you want to use the word tech.

For the US it usually means some successful SV FAANG type software company.

For Germany it's usually some successful hardware engineering company (Siemens, Bosch, Mercedes, Arri, Infineon, Continental etc.). Those companies can afford to pay the equivalent of FAANG wages in Germany albeit at a smaller scale.

Southern Germany has more experience and talent in the latter while Berlin has more software startups and web devs, similar to the former.

Berlin definitely also has a hardware engineering/embedded software scene. It's just that there is no single big company (or cluster of big companies) that dominates the market, but rather smaller shops that mostly do contract work or have some specialised product.

There is also a steady supply of students from that branch of tech - AFAIK AutoNOMOS Lab still exists and there are multiple universities in town that over computer science focused on embedded systems.

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