Shortage of Skilled Labour in Germany: Does it really exist? (Part 3)

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Photo Credit: http://www.sausedo.net

by Paul Köper, Tobias Sieblitz and Ares Kalandides

Are we really heading towards a major shortage of skilled labour? Is it the demographic change as we are often told? While more and more people retire, there are simply not enough young people to replace them. That´s what we said last time (Part 2). However,  this explanation should not be taken so lightly and without questioning. The last part of this blog series examines the issue with geographical differentiation.

The Federal Office of Statistics predicts a shortage of people in paid work up until 2060: “The part of the population that is able to earn one´s living will shrink dramatically. The number of 20 – 65 year olds (2013: 49 million) will decrease from 2020 on and it will, depending on the net immigration, be at 34 or 38 million (- 30% or – 23 %). The number of 20 – 64 year olds will decrease from 61 % in 2013 to about 51 or 52 % in 2060.”

Yet, as terrifying as they sound, these numbers are to be read with caution. Daniel Baumann questions many of the underlying assumptions of the above-mentioned numbers in the Frankfurter Rundschau: “The model of the Federal Statistical Office assumes that the retirement age will be at 65 in 2060, even though “Retirement at 67” is already a done deal. In addition, it is questionable whether the same number of working people as today will be needed to take care of their fellows in the future, if we consider that the entire population might actually be smaller by then. And, whether the birth rate and immigration cannot be increased through political decisions is another question.”

Moreover, demographic change is different in its geographical manifestation. According to the Berlin Department for City Developments and Environment (2012) the number of working people from 18 to 65 years of age will stay steady at 2.3 million in the state of Berlin up until 2030, while the same age group in the same period of time will decrease by about 28 % in the state of Brandenburg.

Hence, again numbers are to be enjoyed carefully.

Findings

To sum our little series on skilled labor shortage up we bring it back to the operational level of our project at “Schönefelder Kreuz”, in which we were tasked with the assessment of the current and future need of skilled labor in the region.

Skilled labour shortage is a regional and vocational specific phenomenon. We emphasized that the worry about a huge lack of skilled labour is often out of proportion and that just because German society as a whole gets older a “labuor market crisis” will not inevitably follow. Nevertheless, this should not divert attention from the fact that in some economic branches and some geographical regions a skilled labor shortage is a real problem and anything but a figment of our imagination.

What was found in our project at “Schönefelder Kreuz” was quite in line with the above stated. While some single economic clusters, like the transportation and the health sector of these three municipalities comprising the “Schönefelder Kreuz”, are already experiencing isolated skilled labour deficiencies, other clusters register no further demand for skilled labour. But the other thing that our study clearly showed is that lack of skilled labour is mostly caused by the extremely low wages in certain branches, e.g. in health industries. In general, the number of potential workers is regarded as sufficient to cover the current demand. Due to its geographical proximity to the capital of Berlin and the actions taken for the recruitment of potentials workers such as programs for the integration of women in the labor market, a major shortage of skilled labour seems to be unlikely. Adequate wages seem to be more efficient than yet another recruiting scheme backed by business lobbies.

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Sources:

https://www.destatis.de/DE/PresseService/Presse/Pressemitteilungen/2015/04/PD15_153_12421.html;jsessionid=F6F7F19566777A2ADC194985669490BB.cae2

Daniel Baumann: „Wird die Demographie zur Katastrophe?“, Frankfurter Rundschau, 27. April 2015, http://www.fr-online.de/arbeit–unsere-religion-/altersentwicklung-wird-die-demografie-zur-katastrophe-,30242698,30537794.html

About Ares

Ares Kalandides holds a PhD in Urban and Regional Studies from the National Technical University of Athens. He is the founder and CEO of Inpolis, an international consultancy based in Berlin, Germany and has implement several projects around the world. Ares teaches Urban Economics at the Technical University in Berlin and Metropolitan Studies at NYU Berlin.
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