In fact, in many places it has become common to encounter difficulties filling vacancies, as is shown by the KOFA Study “Fachkräfteengpässe in Unternehmen: Rezepte gegen den Fachkräftemangel” (Skills shortages in companies: responses to the lack of skilled workers). Back in 2011, between 30 and 40% of vacancies in small and medium-sized enterprises (SMEs) were in occupations affected by the skills gap, and the figure had risen to 66% of all unfilled jobs in 2016/2017. It is thus already possible to speak of an entrenched skills shortage on the labour market. The pressure of demographics due to the ageing labour force is being felt in all of Germany’s regions. The baby boomer generation is gradually reaching retirement age – and too few young people are following in their footsteps. The number of unfilled vacancies hit a new record in the 2016-7 training year. At the same time, in eastern Germany in particular, the number of unfilled training places is going hand in hand with many applicants who can’t find a training place: it is becoming increasingly difficult to match applicants with training places.

A particularly great need for vocational training

The biggest shortage is that of skilled workers with a vocational qualification. But in some occupations there is also a growing lack of specialists with a master craftsman’s certificate or Bachelor’s degree. The healthcare sector – and particularly nursing and care services for the sick and the elderly – is severely affected by the skills shortage. As the population ages, demand for carers will keep growing. And there is also a shortage of people with the right technical and craft-based skills. At a higher level, there is a lack of doctors, engineers and information scientists – key occupations which will help shape Germany’s economic future.

The occupations particularly affected by skills shortages include:

• graduate occupations in the field of medicine, mechanical and automotive engineering, electrical engineering, supply and waste management, IT and software development/programming, STEM disciplines (science, technology, engineering, mathematics).
• Crafts trades: electricians/electrical installers, plumbers, lathe-operators, toolmakers, plastics process workers, pipe fitters, welders, mechanical technicians.
• Care services: healthcare and care for the elderly.

So Germany’s dual vocational training system needs to be bolstered. This task involves the whole of society. For this reason, the Federal Government, the Federal Employment Agency, commerce, the trade unions and the Länder formed the Alliance for Initial and Further Training at the end of 2014. Together, the partners in the Alliance want to enable and to convince more young people to train for one of the more than 300 professions for which vocational training is available.

The south is suffering from the skills shortage – and the situation is getting worse in the east

The skills shortage varies not only from one occupation to another, but also in regional terms. The southern German Länder, with their strong economies, are particularly affected. The latest KOFA study says that roughly two thirds of all jobs advertised in Bavaria and Baden-Württemberg are for professionals whose skills-set is in short supply. The companies can’t see any real improvement happening in the near future. The situation has become worse in eastern Germany in particular. Behind Baden-Württemberg, Thuringia is now the Land with the greatest skills gaps.

This finding is also corroborated by the 2017 IAB Establishment Panel Survey for eastern Germany. According to this study, 37% of the skilled jobs advertised in the first semester of 2017 were still vacant at the date of survey. In western Germany, the proportion of unfilled vacancies has risen sharply to 36% (from around 30% in 2016). This means that, for the fifth successive year, the share of jobs companies were unable to recruit for was once again higher in eastern Germany than in western Germany. In addition to this, approximately one third of vocational training places also remained vacant as there were no suitable applicants.

KOFA’s interactive map shows that the shortages are not nation-wide, and that certain areas are particularly hard hit.

Women

The greatest pool of talent with which to meet the skills shortage is offered by women. With a female labour force participation rate of more than 74% (women aged between 20 and 64), Germany was doing well in 2016. However, the rise in female employment over the last ten years is rooted in more part-time work; there has been virtually no change in the number of women in full-time jobs. The ratio of women in full-time work is higher in almost all the other EU countries. Many women in part-time jobs would like to increase the hours they work. And almost 42% of women aged between 25 and 49 who do not participate in the labour market said that this was because they were looking after children and other relatives.

Of the nearly five million women of working age who are currently not working or looking for a job, the majority are well trained and educated. So it is in the business community’s own interest to make better use of the work and skills offered by women. Here, it is important to have better possibilities to combine family and career.

Older people

Young people and old – all generations will be needed for Germany’s future. Older employees in particular can draw on comprehensive expertise and many years of professional experience. Between 600,000 and 1.1 million skilled workers will be aged between 55 and 64 by 2025. This figure can be found in a study by ZEW from Mannheim on behalf of the Federal Ministry of Labour and Social Affairs. In fact, according to the latest KOFA study (4/2017), the labour participation rate of people aged between 55 and 64 has risen in recent years. Women in occupations with skills shortages tend to work longer, and more men are continuing to work after the age of 65, often in part-time jobs.

Every company can take targeted measures to benefit from the potential of older people. Age-appropriate design of work, an improved balance between work and private life, more further training for older people, targeted recruitment of older people and proactive health management – all of these are investments which pay off equally for companies, for employees and for Germany as a whole.

People with a migrant background

People with a migrant background also offer a lot of potential. Many thousands of additional workers could come on to the market if people with a migrant background were given more support in terms of integration and training. On the one hand, this means integrating refugees into the labour market.

In order to improve the integration of immigrants into the training and labour market, some 170 refugee recruitment advisors have been supporting small and medium-sized companies in filling their vacancies and vocational training positions with refugees since spring 2016. Across Germany, these advisors organise work placements and job shadowing opportunities for refugees, support them in acquiring the basic skills they need, and find jobs and vocational training positions for them in small and medium-sized enterprises (SMEs); since the end of 2017, they have also been working with large companies. They also advise companies on matters including language training, refugees' residence status, skills, and support services – and their work is paying off: since the programme was launched, support has been given to around 11,500 job placements for refugees.

Inclusion: recruiting people with disabilities

According to the Federal Employment Agency, some 177,000 severely disabled people would like to work. Many people with a disability have above-average skills, and their ability to work is hardly affected at all by their disability.

The Economic Affairs Ministry is leading by example. Around 9% of the ministry’s workforce are people with disabilities – that’s well above the legal requirement of at least 6% (current as of February 2018).

You can find out more about inclusion on the website of the Centre of Excellence on securing skilled labour (in German).

Top Germans working abroad

According to estimates, at least 200,000 highly qualified German nationals are currently working in the U.S., Switzerland and other EU countries. It is good to see that German skilled workers enjoy such a great reputation abroad. At the same time, we can do more to try and benefit from this wealth of experience, and encourage these people to make a career in Germany. We need to do more to build a bridge for people returning to Germany. Here, it would be helpful to have greater transparency about services and opportunities for those interested in returning to Germany, and also to give them more support with their return and reintegration.

As closing the skills gap is a continuous process, the competent ministries of the Federal Government are in constant dialogue with the relevant actors of the partnership for skilled professionals. The skilled labour strategy is based on the following three pillars.

At domestic level: proactively addressing changes

When it comes to the implementation of the skilled labour strategy, the focus is on domestic potential. The challenge here is that the rapid progress on digitisation will contribute to a fundamental change in the job profiles of more than 35 percent of all occupations by 2030. One priority of the strategy is therefore to ensure the employability of current employees through skills enhancement and further training. These efforts are complemented by a series of interrelated measures in the areas of training, quality of work and reconciling work and family life.

At EU level: maintaining Germany’s attractiveness as a business location

Today, skilled workers from other European countries make an important contribution to the competitiveness of German industry within the scope of the free movement of workers, and are thus helping significantly to close the skills gap. To ensure that Germany remains an attractive location for skilled workers from other European countries, targeted information and advisory services are being further expanded in other member states. In addition, we must make better use of the existing potential of qualified professionals from abroad who come to live and work in Germany. To achieve this, measures will be taken to facilitate learning the German language, to improve the recognition procedures for educational and professional qualifications and to allow more apprentices and students to meet the eligibility criteria for financial assistance.

At third-country level: increasing the immigration of qualified professionals

In addition to efforts to attract domestic and European skilled workers, the German economy is increasingly dependent on well-trained skilled workers from non-European countries. The Skilled Immigration Act is intended to help alleviate the skills shortage in a targeted manner. This is vital because the skills shortage is already slowing our economic growth. To facilitate the immigration of skilled professionals from abroad in particular, the skilled labour strategy seeks to adjust the legal framework and provides for a series of practical measures. In addition to the Skilled Immigration Act , this includes a more efficient recognition procedure for foreign professional qualifications, a demand-oriented advertising strategy in selected target countries, language promotion measures and more efficient administrative procedures.

In its latest report, the Council of Economic Experts says: “In order to keep the total potential labour force at its current level, 400,000 more people will have to migrate into Germany than emigrate from the country each year from now on.”

Tailored services help professionals and immigrants to integrate successfully in the labour market. In order to fill as many jobs as possible, the Federal Government will introduce a law on the immigration of skilled workers. It is quite clear that, without immigration, we cannot maintain the current size of the labour force in Germany. We need immigration to tackle the shortage in STEM and other occupations. According to the latest autumn STEM report, foreign STEM workers are making an above-average contribution to securing the supply of skilled labour. Without them, the gap would be around 118,100 people more than it is today.

A law on the immigration of skilled workers

On 2 October 2018, the Federal Government agreed on principles for the immigration of skilled workers from third countries. A draft act is to be presented by the end of 2018, and the parliamentary procedure is to commence in the second half of 2019. The aim is to improve the possibilities for the immigration of skilled workers. The current rules applying to people with vocational qualifications on particular are to be adapted, and supporting measures are to be taken.

Make it in Germany

"Make it in Germany” is the German government’s information portal for qualified professionals from around the world. It provides information for skilled professionals who are considering moving to Germany, including information on career opportunities in Germany and details of current job vacancies in professions where there is a skills shortage. Furthermore, some of the international qualified professionals who are already successfully building careers in Germany share some of their personal experiences and explain how they mastered the challenge of living in Germany. Employers in Germany can find information on how to successfully recruit international skilled professionals, whilst professionals abroad can inform themselves about visa issues, job offers and the various sectors in the German economy. Since June 2012, more than 15 million users from over 200 countries have visited the site - an average of 200,000 people a month.

“Make it in Germany” – 24 hours in Germany

The launch of the “Working and living in Germany” hotline on www.make-it-in-germany.com marks the first time that the German government has offered a comprehensive, multilingual advisory service for qualified professionals, students, and apprentices who have moved to Germany or are planning to do so. Call +49 30 1815 1111 for information on immigration and visa issues, German language courses, job hunting, and the recognition of professional qualifications in Germany.

Recognition of professional qualifications acquired abroad

The rules governing the recognition of foreign professional qualifications were improved in 2012 by the Federal “Act to Improve the Assessment and Recognition of Professional Qualifications Acquired Abroad”. This law creates a legal entitlement to have one’s professional qualifications obtained abroad assessed, to see whether they can be recognised as equivalent to German qualifications.

Furthermore, non-EU nationals with higher-education qualifications can now spend up to six months in Germany to seek employment, provided that they can support themselves for the duration of their stay.

A practical tool: The BQ Portal of the Federal Ministry for Economic Affairs and Energy is the most comprehensive online knowledge and working platform for foreign professional qualifications. The platform offers descriptions of 87 vocational training systems around the world and more than 3,000 foreign professional qualifications. This enables the relevant bodies (the professional chambers) to improve their assessment of foreign professional qualifications and to make the recognition process quick, uniform and transparent.

Highly qualified professionals from around the world are particularly needed in occupations where there is a skills shortage. The rules on the immigration of people with vocational qualifications are therefore being relaxed. The orientation of the “positive list” of occupations where there is a skills shortage to regional labour market needs means that qualified professionals from abroad can now work in more than 130 occupations.

The Federal Government’s website on the recognition of foreign professional qualifications also helps people find out more about how to get their qualification recognised in Germany. The Federal Ministry of Education and Research (BMBF) keeps providing updates about this on its Facebook page.

EU Blue Card

The “EU Blue Card” makes it possible for persons with a higher-education degree who have a specific job offer and come from non-EU countries to come to Germany with their families and work and live here.

Giving immigrants the best possible support

There is also the programme for the perfect match for SMEs, which is tailored to young people from Germany and abroad who do not have refugee status. This programme has proven highly successful in helping consultants, who in turn help companies establish and develop a culture of openness to the world and integration for the many non-German apprentices and skilled workers who have come to Germany, but not as refugees.

In many countries across the globe, skilled labour is in short supply. This means that neither local businesses nor foreign investors, for instance from Germany, are in a position to harness the full potential offered by the relevant markets. This is where the Skills Experts programme comes into play. It aims in particular to support German SMEs as they train up young people in other countries in line with the German dual vocational training system. This programme benefits German SMEs in particular, and also the partner countries and young people in those countries.

The programme funds the secondment of vocational training experts (skills experts) to seven German chambers abroad (in Bosnia and Herzegovina, Indonesia, Kenya, Croatia, Malaysia, Macedonia and Viet Nam). There are plans to extend the coverage to include Ghana, Nigeria and South Africa. The skills experts work closely together with the Association of German Chambers of Industry and Commerce (DIHK) as the programme partner, in order to guarantee standards in the field of vocational training that are recognised worldwide and their certification in line with the German system.