March 12, 2024
WHAT CHALLENGES DOES GERMANY FACE IN THE LABOUR MARKET? THE 3 DS!
The employment rate in Germany has increased from 74% to 78%, more women are in the labour market (+10%), the unemployment rate has fallen from 7.7% to 5.9% and yet Germany faces a major challenge - a shortage of skilled workers. This problem is due to a combination of factors, including digitalisation, demographic change and decarbonisation. This is referred to as the 'big 3 Ds'.
What do these 3 Ds mean?
1. Demographics
In Germany, a large proportion of the population is over 45 and a significant proportion is over 66. The baby-boomer generation, born between 1955 and 1970, is retiring, which has an impact on the entire workforce. The retirement of older workers creates vacancies that cannot be filled by younger people. However, due to an increasingly ageing population, there is also a growing need for skilled workers in health, care and social services. There is already a labour shortage in these sectors too. In terms of regions, areas with a decreasing number of young people and an increasing number of older people, such as East Germany, structurally weak areas and rural-peripheral labour market regions, will be the most affected and will experience increased skills shortages in the future.
2. Decarbonisation
In the face of climate change, we should make our work and business more sustainable. To this end, the mobility, construction, industry and energy sectors have a key role to play in decarbonisation. As we move away from fossil fuels, jobs will be lost in these industries, but new job opportunities will also be created in renewable energy, which will require new skills and qualifications.
The transition to a climate-neutral economy often involves technological innovations that change established job profiles. This is true for both large and small companies and is evident in the transformation of the automotive industry towards decarbonisation and digitalisation. As the industry develops new powertrain concepts and business models, some jobs will be lost and new skills will be needed for others, including automotive mechatronics and workers in relevant testing professions.
In addition, there is growing demand for traditional occupations such as energy and building technology, heating and air conditioning technology. These sectors will need skilled workers because of the need to transition to renewable energy, with the additional challenge of replacing retiring workers. In conclusion, as we move towards climate protection, there will be job losses in various sectors and new jobs will emerge requiring different skills.
3. Digitalisation
The impact of digitalisation and automation on jobs is twofold. While it can lead to job losses due to the elimination of certain activities, it can also create new jobs and require new skills. There is no clear consensus on the overall impact of digitisation. As online media becomes more widespread, jobs in traditional publishing, book trade and paper technology will decline. Similarly, the use of algorithms and chatbots in e-commerce is automating many occupations in sales, banking and insurance, causing significant changes in labour requirements. However, it is not only employees in these fields that need to adapt to new digital systems; there will be a growing need for ICT specialists and trainers to support the growing demand for skills and lifelong learning. As a result, more and more bottlenecks will arise in these areas in the future.
These 3 factors are the main areas of focus for the German government and are being actively addressed. If you want to learn more about this topic, you can download the "German government strategy on skilled workers" from the official German government website.
SOURCE: HTTPS://WWW.BUNDESREGIERUNG.DET
What do these 3 Ds mean?
1. Demographics
In Germany, a large proportion of the population is over 45 and a significant proportion is over 66. The baby-boomer generation, born between 1955 and 1970, is retiring, which has an impact on the entire workforce. The retirement of older workers creates vacancies that cannot be filled by younger people. However, due to an increasingly ageing population, there is also a growing need for skilled workers in health, care and social services. There is already a labour shortage in these sectors too. In terms of regions, areas with a decreasing number of young people and an increasing number of older people, such as East Germany, structurally weak areas and rural-peripheral labour market regions, will be the most affected and will experience increased skills shortages in the future.
IN ADDITION, THERE IS A GROWING DEMAND FOR TRADITIONAL PROFESSIONS SUCH AS ENERGY AND BUILDING TECHNOLOGY, HEATING AND AIR CONDITIONING TECHNOLOGY.
2. Decarbonisation
In the face of climate change, we should make our work and business more sustainable. To this end, the mobility, construction, industry and energy sectors have a key role to play in decarbonisation. As we move away from fossil fuels, jobs will be lost in these industries, but new job opportunities will also be created in renewable energy, which will require new skills and qualifications.
The transition to a climate-neutral economy often involves technological innovations that change established job profiles. This is true for both large and small companies and is evident in the transformation of the automotive industry towards decarbonisation and digitalisation. As the industry develops new powertrain concepts and business models, some jobs will be lost and new skills will be needed for others, including automotive mechatronics and workers in relevant testing professions.
In addition, there is growing demand for traditional occupations such as energy and building technology, heating and air conditioning technology. These sectors will need skilled workers because of the need to transition to renewable energy, with the additional challenge of replacing retiring workers. In conclusion, as we move towards climate protection, there will be job losses in various sectors and new jobs will emerge requiring different skills.
3. Digitalisation
The impact of digitalisation and automation on jobs is twofold. While it can lead to job losses due to the elimination of certain activities, it can also create new jobs and require new skills. There is no clear consensus on the overall impact of digitisation. As online media becomes more widespread, jobs in traditional publishing, book trade and paper technology will decline. Similarly, the use of algorithms and chatbots in e-commerce is automating many occupations in sales, banking and insurance, causing significant changes in labour requirements. However, it is not only employees in these fields that need to adapt to new digital systems; there will be a growing need for ICT specialists and trainers to support the growing demand for skills and lifelong learning. As a result, more and more bottlenecks will arise in these areas in the future.
These 3 factors are the main areas of focus for the German government and are being actively addressed. If you want to learn more about this topic, you can download the "German government strategy on skilled workers" from the official German government website.
SOURCE: HTTPS://WWW.BUNDESREGIERUNG.DET
