Employee Shortage as German Economy Booms

By Akinyi Princess of K’Orinda-Yimbo

http://www.akinyi-princess.de

Faced with a shortage of highly qualified specialists and skilled workers in many hi-tech fields, and with many qualified young German engineers, doctors and technicians leaving the country for more lucrative employment in the USA and Canada, Germany has eased the restrictions on migration of some professional groups from non-EU countries that had previously made it more difficult for them to find work in the country.

For the first time, since the regulations on the recruitment of these professionals were tightened in the early 1970s, the German government has agreed with industry and union leaders to go for a long-term concept that includes changing immigration laws and qualification criteria.

Germany’s economy, the largest in Europe, has serious deficits in the technology oriented industry. This is a direct result of the demographic map of the country as well as the lack of sufficiently trained high-tech labour. The fertility rate has been plummeting for decades, forcing the country to rethink its immigration and qualification laws in order to import foreign qualified workers as well as lessen strict rules that up to now had made it hard for the German technology industries market to accept degrees or diplomas acquired outside the Western and Northern Europe.

As Germany booms, the shortage of workers get more acute especially in the sectors for engineers, doctors, high-tech and skilled care of the elderly (which has a very low status in Germany) in a country getting older without producing more children. The minimum wage for qualified staff who take care of the elderly is low (€8.50 in the eastern and €11.60 in the western part of the country). The “discriminatory” wage and salary discrepancy between east and west has further led to younger people migrating from the east to the career-oriented west of the Federal Republic. Despite the dual pressures of measures to fight inflation and an aging population, Germany’s wages are kept low compared to wages in its neighbour countries.

It has therefore been decided that as from May 2012 restrictions that had been imposed on East Europeans by Germany will be lifted. However this may already be too late as most East Europeans had headed for other countries such as Britain, Ireland, France or Holland where they learnt the native languages and settled; they’re unlikely to pack up again to come to Germany and start all over, despite Germany’s booming economy and generous social welfare.

Germany’s leading high-tech industry organisation, The Federal Association for Information Technology, Telecommunications, and New Media, reported that its members are short of 28,000 qualified workers. In 2010, the consulting firm McKinsey published a report that estimated Germany will be short of 2m qualified employees in 2020. In Health care, 1m people will be needed to look after the elderly alone, because by the 2030s people older than 65 will number 24m compare to the current 16m. By 2050, people older than 80 will increase from the current 4.5m to 10m according to the Federal Statistics Office. The TFR (total fertility rate) is currently 1.38 children per woman, a birth rate not high enough to keep the population stable; a population (currently 82m) expected to fall by 17m in the next 50 years, and always with the elderly in an overwhelming percentage.

For this reason the German authorities, together with industry and union leaders, have launched a massive “Green Card” system to import professionals, especially programmers from India. Furthermore, the Eastern European qualifications will now not be rejected right out. Instead, 77 of Germany’s 80 chambers of commerce have agreed to set up a body, IHK-Fosa, (Chamber of Commerce-Foreign Skills Approval) that would assess and test the qualifications of foreign applicants in comparison with German qualifications. This means a medical or engineer degree achieved in a university in Bulgaria or Slovenia will not automatically be rejected as inadequate. The European Development Bank director still says, “Germany nevertheless retains a lot of restrictions in recognizing professional qualifications.”

For health care, many German companies organize training courses in Eastern European countries like Poland and the Czech Republic, but the number is small because most of the people had already left for other Western countries following the opening of the EU borders. Meanwhile the government is also applying a variety of methods such as retirement at age 67 instead of 65, enticing women with various fringe benefits to encourage them to have more children and building more pre-school kindergartens.

Perhaps the advantage that Germany has over other countries would be its perceived generous social welfare benefits and a well-run country.