Germany is running out of workers
Never before in Germany have so many people been working (in a job) as today. Insurable employment last year was at a record high of 42 million people.
Perhaps the number will never be higher. Because baby boomers are now retiring. This is the generation defined as people born from 1946 to 1964 during the mid-20th century baby boom.
As a result, significantly more people are retiring than are entering the labour market. Last year the balance was around minus 300,000. By the end of the decade, it will increase to 700,000 per year. By 2030, the demographic gap in the labour market will add up to five million people.
No good prospects for Germany. Particularly because the entire social security system and large parts of the tax system are financed by the working part of the population.
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What should we do?
We must keep the working part of the population as large as possible. By people retiring later. By increasing the incentives to work more. By more immigration into the labour market. By tailor-made training so that qualifications better match the jobs offered. And by helping people to take up a job at all (despite the shortage of workers in Germany, 2.6 million people are unemployed; in addition, there is a hidden reserve of 3 million people, i.e. people who are not registered as unemployed but would work under appropriate conditions).
The upshot: Labor shortage has arrived in Germany. There are job offers on posters in shop windows on every corner. I am convinced that we are at the beginning of a time when workers will receive a new dimension of appreciation – provided politicians do their “homework” and set the framework in such a way that work pays off.
The Strolling Economist