Labor Shortage in Germany? Between Demographic Reality and Labor Market Needs Études de l’Ifri, October 2023
The debate about labor shortages has been long dominating the German public debate. It has been pushed to the agenda again in the context of recent reforms in migration policy. Paradoxically, Germany boasts a robust population size, a significant labor force, and a notably larger proportion of working-age individuals compared to France.
Far from being the cause for labor market challenges in Germany, demographic factors have historically bolstered Germany’s economy. Yet, a puzzling debate continues to emerge, focusing on a perceived shortage of skilled workers. What underlies this intriguing discourse about Germany’s labor force?
A paradox emerges when we compare the public discourse to the actual demographic situation regarding labor shortages in Germany. On one side of the spectrum, the Institute for Labour Market and Occupational Research (IAB), influential professional associations, the business sector, and the media are resounding with calls for an annual influx of 400,000 additional workers. However, in stark contrast, the demographic reality paints a less dire picture in the near term, thanks to effective labor market policies.
In a country where far-right movements seek to exploit such situations, the arrival of refugees in 2015 and the ongoing conflict in Ukraine raise crucial questions regarding social acceptance, logistical feasibility, and infrastructure readiness. Regardless, Germany must prepare for significant structural adjustments to meet the needs of its evolving labor market. This constitutes a major challenge for the country in a near future.
Anne Salles is lecturer at Sorbonne University and a research associate at the "3 familles, fécondité, conjugalités" research unit of the Institut national d'études démographiques (INED). Her research focuses on fertility issues and family policies in France and Germany. She coordinated an issue of Allemagne d'Aujourd'hui dedicated to Germany's demographic challenges.
- This publication is available in French: Pénurie de main-d’œuvre en Allemagne ? Entre réalité démographique et besoins du marché du travail (PDF).