Germany Forging Ahead With Effort to Attract Skilled Workers

(Bloomberg) -- Germany’s ruling coalition is pushing ahead with efforts to attract more skilled workers from abroad to help address an unprecedented staff shortfall in Europe’s biggest economy.

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The cabinet will approve draft legislation updating immigration rules for skilled workers on Wednesday, Chancellor Olaf Scholz said Monday in a speech in Berlin. While the employment trend has been positive, vacancies are “at an all-time high” and the government will therefore “look more at the qualifications and professional experience of immigrants and less at formalities,” he said.

Scholz’s coalition of his Social Democrats, the Greens and the business-friendly Free Democrats has said it wants to attract 400,000 qualified workers from abroad each year. A demographic imbalance coupled with labor shortages in key sectors risks undermining an economy still reeling from the coronavirus pandemic and the energy crisis triggered by Russia’s war on Ukraine.

Half of all German companies are struggling to find skilled workers, and the shortage is particularly acute in services, where some 54% of businesses are affected, according to a survey published in August by the Munich-based Ifo institute. Some 45% of manufacturers complained about a lack of workers.

As well as smoothing the path for immigrants, the government is also planning to reform Germany’s citizenship rules, Scholz said. Interior Minister Nancy Faeser, speaking at the same event Monday, said the government is aiming to get the necessary legislation through parliament in the first half of next year.

The issue has been front and center in the German media in recent days. Some opposition politicians on the right have reacted angrily to proposals to remove bureaucratic hurdles to naturalization, shorten the time applicants must live in Germany before applying for citizenship and allow people to retain multiple passports.

“The fact that we are combining immigration with labor-market opportunities is not just for economic reasons,” Scholz said Monday. “I firmly believe that integration of adults works best through the labor market.”

The government’s strategy for attracting skilled workers includes:

  • Making it easier for immigrants to take up vocational training or study in Germany

  • Allowing anyone who has an employment contract with a domestic employer to start work and have their vocational qualification recognized at the same time

  • Introducing a transparent, unbureaucratic points system for finding work

--With assistance from Arne Delfs.

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