A welder works on a steel segment for a wind turbine tower
Source: pa / dpa / Patrick Pleul
Germany lacks millions of workers. Politicians want to cushion the bottlenecks through more immigration. But a new study by the OECD now shows the deficits in the previous German migration policy – and they have concrete effects on the economy.
Hubertus Heil recently returned from Brazil. The Mission of the Secretary of Labor in South America: As many workers as possible recruit for home care. This strategy is not new. Ex-Health Minister Jens Spahn (CDU) went on a promotional tour for the Federal Republic in Latin America – with limited success. The Institute for Labor Market and Vocational Research (IAB) puts the additional demand in all sectors at 400,000 foreign workers per year. Most recently, just under a quarter of this target was achieved.
That Germany wants to focus more on immigration in the future and Heil and his cabinet colleaguesmost modern immigration law in Europe“ is no coincidence. The labor shortage is already destroying several billion euros in added value every year, and the country is currently short of almost two million workers.
And the gap is getting bigger: According to the German Economic Institute (IW), there is a risk of five million people by 2030 due to aging further employees to be eliminated. If politicians follow the recommendations of economists, immigration to Germany will increase significantly in the coming years. This continues a trend.
In hardly any other prosperous country have so many people immigrated in recent years as to Germany. In addition to regular labor migration, the two major refugee movements in 2015 and 2022 in particular caused the numbers to rise sharply.
achievements and deficits
A new study by the Organization for Economic Co-operation and Development (OECD) now provides one of the most comprehensive collections of data on migration in all EU and OECD countries to date on more than 300 pages. While around 54 million people were born abroad in the EU, the total is 141 million in the 38 OECD countries. The researchers examined 83 indicators from the areas of the labor market, education, living conditions and social participation.
The study particularly emphasizes the successes of immigration. The analysis is also instructive for Germany because the researchers show where the deficits in migration policy lie. Because these have a concrete impact on the economy and the labor market. For example, in the labor-scarce EU, 2.4 million more people could be in the workforce today if migrants found work as easily as native-born people.
But the time differences are immense. “Migrants who are admitted as part of family reunification or for humanitarian reasons initially find it difficult to access the labor market, but after ten years they have almost as good labor market opportunities as native-born people,” write the authors, including Thomas Liebig, economist and migration expert at the OECD.
Nevertheless, immigration helps significantly to eliminate staff shortages. According to the data, the working population in the OECD area has grown by eleven million and in the EU by four million in the past five years as a result of new immigration. This is also reflected in Germany: At almost 46 million, the number of people in work has never been as high as it is today.
According to the OECD, the reason for the increase is not only a “better integration policy” than ten years ago and the more favorable situation on the labor market, but also the increased level of education of the newly immigrated people. In 2020, 36 percent in the EU and 47 percent in the OECD area of migrants who had immigrated in the previous five years had a tertiary education. Ten years earlier it was only 22 percent and 32 percent respectively.
Nevertheless, the authors around Liebig also emphasize that there is still cause for concern, especially with regard to employment and living conditions. In some areas “no significant improvements can be seen”. For example, the proportion of homeowners among foreign-born people is lower.
A disproportionately high proportion of immigrants also live in inferior apartments. More than a sixth of immigrants in the EU and OECD countries, for example, live in overcrowded housing – the proportion is 70 percent higher than among native-born people.
“In four out of five countries, immigrants are also more likely to live below the relative poverty line of their country of residence,” the analysis continues. In most countries, for example, the poverty rate of children from migrant households is at least 50 percent higher. Not surprisingly, income inequality is also greater among people born abroad.
Low level of education
The bottom line is that the study also makes it clear how great the untapped potential of immigration is from an economic perspective. The immigrant population in general has not managed to fully catch up with the native-born population, it says. “The results clearly show that the skills of those who are already there should be better used,” said economist Liebig when presenting the analysis.
Because despite the educational successes, there are still downsides: “The educational level of more than a third of all those born abroad in the EU is not above primary school level,” write the authors. This proportion is more than twice as high as in the native-born population. In addition, migrants find it more difficult to find jobs in which they can fully use their skills.
Also alarming: “In all countries, migrants with tertiary education are less likely to be employed than native-borns, and in almost all countries they are more likely to be overqualified for their job.”
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