Talking point
Germany: Greater efforts still needed to attract workers from abroad

February 11, 2013

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According to the findings of a report by the OECD on labour migration, Germany attracts too few skilled workers from non-European countries despite relatively few bureaucratic hurdles compared with the UK, Ireland or Denmark. True, the comparison may be misleading but in view of the strong demand for skilled labour, the German economy has strong backlog demand in recruiting qualified immigrants.

According to a new OECD report on labour migration, Germany still lags a long way behind other OECD countries in recruiting qualified personnel from non-European countries. The German immigration system is regarded as relatively open and unbureaucratic, though. The report is based on a survey by the Association of German Chambers of Commerce and Industry (DIHK) in which 1,113 companies in Germany with at least 10 employees participated.

The report finds that almost half of the companies who had not hired foreign staff despite unfilled vacancies did not even consider this option. Furthermore, more than 30% of employers complained that recruiting from abroad was too complicated and that the applicants lacked German language skills.

All in all, German companies hire only roughly 25,000 labour migrants per year from non-EU countries and the European Free Trade Area (EFTA), which comes to only 0.02% of the population. According to the OECD, the UK, Ireland and Denmark, where the share of non-European migrants is five to ten times as high, are much more successful. As German companies solely by the geographic location have always had a stronger European (especially East European) focus, this is not a very revealing yardstick. After all, half of the migrants to Germany comes from East European countries, especially Poland (20%) and Romania (13%). The share of migrants from non-European countries is only 20%.

aThe comparison with Anglo-Saxon states also makes only limited sense due to the importance of language skills. For instance, in 2011 over 60% of labour migrants entering into the UK came from only three countries – Australia, India and the US. Together with Canada, New Zealand and further former colonies, 70% of labour migrants into the UK have English as a mother tongue or at least good English language skills. German companies do not have recourse to such a large pool of labour from other countries who are native German speakers.

By contrast, the comparison with Denmark is interesting where the lack of language skills is apparently much less problematic. The reason is certainly an internationally more open corporate culture in which English as working language is part of normality. It is utopian to believe that the demand for skilled personnel in Germany can be met by immigrants who are already fluent in German. The demographic development in Germany will make the shortage of qualified labour in many occupational groups even more serious. The OECD report also shows that the problem is especially acute with regard to semi-skilled workers without a university degree.

The OECD's recommendations that there should be more job-specific German courses offered in home countries and greater efforts to woo foreign students will not solve the problem alone. If qualified labour in countries such as Denmark have the possibility to carry out their work in English they simply have better labour market and income opportunities than in Germany. Therefore it is not surprising that the large number of jobs on offer in Germany is not met by corresponding demand.

A new approach needs to be taken regarding the intellectual potential which the German economy loses. On the one hand, especially medium-sized companies are increasingly suffering from the lack of qualified labour, while on the other – according to the OECD report – they have at the same time the greatest difficulties in recruiting appropriate candidates from abroad. German language skills are cited by roughly 90% of the companies surveyed as one of the decisive criteria with regard to the hiring of foreign employees – and are thus even more important than the qualification level or the professional experience of applicants. A better integration of foreign qualified staff with a good command of English and their provision with "on the job" German lessons could thus also be part of the solution.



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