Acute skills shortage in the digital transformation

31 October 2024, Munich. The shortage of specialists in the key occupational groups required for the digital transformation is immense – and is making recruitment particularly difficult for family businesses. A new study by the Foundation for Family Businesses takes a detailed look at occupational fields and regions – and makes recommendations. The amendment to Germany’s Skilled Immigration Act (abbreviated FEG in German), which will gradually come into force from 1 November 2023, can help.

At the end of 2022, the situation on the labour market was tighter than ever before: in the western German states, there were no suitably qualified unemployed individuals for 63 per cent of vacancies, compared to 58 per cent in the east. This means that around six out of ten vacancies remain unfilled. These are the findings of the study “Specialists for the digital transformation” conducted by the Cologne Institute for Economic Research (IW).

The study looks at four occupational fields that were identified by the IW in a previous study as playing a key role in the digital transformation. These include the traditional IT professions, but also jobs in other professional fields such as mechanical and automotive engineering or energy and electrical engineering.

Five times as many vacancies

Broken down into individual occupational groups, this means that the number of registered vacancies for academically qualified IT experts alone has risen from around 3,500 in 2016 to 18,200 in 2022. That is more than a fivefold increase. However, the situation can vary greatly depending on the qualifications required and the region.

For example, there was even a surplus of jobseekers in certain IT professions in Berlin (over 1,500) and in Cologne (nearly 400). In contrast, there were practically no suitable applicants to be found nationwide in the fields of mechatronics, energy and electrical engineering. In the district covered by the Schwandorf employment agency, the ratio of vacancies to qualified jobseekers stood as high as 92.6 per cent.

The IW recommends a clear focus on the recruitment of foreign skilled labour. This is also in light of the fact that Germany’s federal government was so quick to act on the criticism of the FEG from 2020. A total of 82 per cent of the family businesses surveyed consider foreign skilled workers to be an asset, according to the results of an accompanying survey of 846 companies, 566 of which are family businesses. At the same time, 64 per cent say that recruiting abroad is too difficult for them. Only just under a quarter of all family businesses have employed international specialists in the last three years.

Further obstacles must be removed

Overall, there will be significantly more ways to attract skilled labour to Germany in the future. According to the IW, however, administrative processes must become faster and more transparent and further obstacles must be removed. According to the study, this includes greater digitalisation of public authority structures, the lifting of the ban on temporary work and the creation of central support services.

Dr David Deißner, Managing Director of the Foundation for Family Businesses:

“I’m glad to see that companies are now finding more favourable conditions in certain cases when it comes to employing skilled workers from abroad, at least as far as legislation and regulations are concerned. Only practical experience will reveal whether the improvements will actually benefit companies. The main focus now is on streamlining and digitalising processes at government agencies. Many companies face major obstacles in this regard.”

“The new law expands the range of possibilities”, notes Oliver Wilhelms, HR Head Germany & Switzerland at Henkel AG & Co. KGaA. 

“Employers in Germany can now also employ staff from abroad who do not have a degree but have sound specialised knowledge.” rt, date