Australia Markets open in 3 hrs 54 mins

Germany needs 260,000 immigrants a year to compensate for its ageing workforce

Jill Petzinger
Jill Petzinger, Germany Correspondent, Yahoo Finance UK
An employee at the new Takeda pharmaceutical factory in Oranienburg, Germany. Photo: Reuters/Hannibal Hanschke/File Photo

Germany will need at least 260,000 immigrants per year for the next 40 years to meet an increasing labour demand, according to a new study.

The Bertelsmann Foundation study — based on calculations by the Institute for Employment Research and the University of Coburg — took into account factors such as a higher birthrate, more women joining the workforce, and a raise in the retirement age.

“Even if men and women worked the same amount and a pension age of 70 were to be introduced in Germany, it would not be possible to meet the demand for skilled labor,” according to the Bertelsmann Foundation. 

Germany is in the process of increasing its retirement age to 67 by 2029. The country’s birthrate is on the rise again too, hitting its highest fertility rate since 1973 in 2016, and putting it around the European average of 1.59 babies per woman.

Migrants from other EU countries won’t be sufficient to meet Germany’s labor demand either, according to the study. Between now and 2060, it estimates that 114,000 people a year will move to Germany from other EU states, so another 146,000 will be required annually from non-EU countries to make up the deficit. Statistics show that only 38,000 moved to Germany and stayed from other EU states in 2017.

Immigration to Germany because of Brexit won’t make a dent in the labor shortage either, according to Bertelsmann, as Germany’s EU neighbours are also suffering from the same aging-demographic problems.  

Jörg Dräger, director of the Bertelsmann Foundation, says it is imperative that Germany hurry up and pass a new immigration law approved by the country’s Cabinet in December. Part of the law would make it easier for skilled professionals from non-EU countries to move to Germany to work. 

“Migration and integration are jobs for society as a whole, and a new law alone is not enough,” Dräger said, noting that the country also needs more attractive integration offers and a sustainable welcome culture. 

The German labor office said in August 2018 that there were 1.2 million unfilled vacancies in the country and urged the government to keep paying for language classes for asylum seekers, who can then be trained to join the workforce. While there has been widespread scepticism that many of the million-plus refugees who arrived in Germany since 2015 could contribute to the labor market, August 2018 data from the federal labor office showed that more than 300,000 asylum seekers had found jobs as of May last year.