A new study suggests that Germany cannot maintain its prosperity without significant immigration from non-EU countries. To sustain its workforce, the country may need about 288,000 workers each year from around the world through 2040, according to the study.
What would happen to Germany's labor force without immigration?
Given Germany's aging society, it's only logical that the labor force would shrink, with all the expected adverse effects on the economy. But by how much exactly and how soon?
According to a new study, the consequences would be dramatic: Without immigration, Germany would have a quarter fewer workers by 2060.
The Bertelsmann Foundation study projects that by 2040, the number of workers will fall by around 10 percent -- from the current 46.4 million to 41.9 million. By 2060, the labor force is expected to shrink further by 25 percent to 35.1 million.
"Demographic change, which will pose major challenges for the German labor market in the coming years with the retirement of the baby boomers, also requires immigration," said Susanne Schultz, one of the two authors of the Bertelsmann study.
In order to avoid such a scenario and have a sufficient number of people in employment, the authors of the study estimate that around 288,000 workers from abroad will be needed every year until 2040 -- especially from non-EU countries.
The 88-page study, published Tuesday (November 26), "examines the extent to which and to what extent immigration is necessary in order to stabilize the potential workforce and meet the demand for workers." According to Bertelsmann, it was compiled by economists from the State Institute for Employment Research (IAB) and Coburg University of Applied Sciences.
Founded in 1977, the Bertelsmann Stiftung is one of Germany's largest foundations with 330 employees in four countries. Its self-proclaimed goal is to strengthen democracy.
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Expert calls for a good welcoming culture
According to report author Schultz, Germany's reformed Skilled Immigration Act offers new opportunities for workers interested in Germany. At the same time, she stressed that a strong welcoming culture is needed in authorities, companies and municipalities, as well as longer-term prospects for immigrants to stay.
But organizations and studies have repeatedly shown that significant barriers still stand in the way of skilled workers moving to Germany. The Organization for Economic Cooperation and Development (OECD), for instance, recently lamented high bureaucratic hurdles, the length of and bottlenecks in the visa process abroad as well as more and better integration services such as shelter and child care support.
Some of the changes to the Skilled Immigration Act, which are designed to ease barriers for skilled workers from outside the EU, took effect in March. In the first half of this year, Germany issued more than 80,000 employment visas, more than half to skilled workers.
According to the foundation's report, some of Germany's 16 federal states would be hit worse than others by a lack of immigration by 2040: The labor force in the eastern German states of Thuringia and Saarland, for instance, would decline well over 10 percent. In Hamburg, Berlin and Brandenburg, it would be less severe.
The study suggests that the states of Baden-Württemberg, Bavaria, Hesse, Berlin and Hamburg would need a particularly large number of workers.
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Untapped potential
According to another study, Germany also needs to do a better job of integrating migrants already in Germany into the labor force: A study by Germany's Federal Institute for Population Research (BiB) from the beginning of the year found that people with foreign roots are still underrepresented in the German labor market.
In order to exploit the potential of people with a migrant background, Germany should therefore actively promote integration into society and the labor market, language acquisition and access to early childhood, school and vocational education, the authors of the study stressed.
According to the Federal Institute for Population Research, Germany is home to roughly 24 million people with a migration background -- more than one in four of the country’s total population of nearly 85 million.
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with KNA