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Ask HN: Why there is a labour shortage in Germany?
25 points by donnie12345 on Sept 3, 2023 | hide | past | favorite | 57 comments
https://www.euronews.com/2023/06/23/german-lawmakers-approve-a-plan-to-attract-skilled-workers-to-plug-the-countrys-labor-gap

https://www.reuters.com/business/energy-crisis-inflation-push-more-german-firms-into-insolvency-study-2023-06-29/

There were 8,400 corporate insolvencies in Germany from January to June, up 16.2% from the first half of 2022 and the biggest percentage increase in more than 20 years,

How come there is a labour shortage when Germany is facing deindustrialization?




The reality does not match the plans. The German immigration process is hampered by infuriatingly slow and opaque bureaucracy, difficulty of finding housing, and the language barrier.

The immigration office is completely failing to process its current workload, and everyone is wondering how they're supposed to handle even more applicants.

It takes 3-6 months to get a work visa in Berlin these days. People get fired before they even start because employers give up on them. You can't get an appointment there so a bunch of people are stuck in the country with an expired residence permit, often for months. More and more people are suing the state for failure to act.

Then people can't find a flat. The housing crisis has dramatically worsened in Berlin and a lot of people are profiteering from the situation. It has gotten absurd in Berlin.

Then parents can't find a Kindergarten for their children.

It's a never-ending bureaucratic nightmare. Nothing ever just works. For immigrants, it's just worse.

And for what? The payoff just isn't there. You don't come for the great food, the great weather or the warm people. You don't come here because it's easy and things just work. You don't come here for the salaries.

There's a labour shortage because the salaries don't match the job requirements or the cost of living, the system does not do its job, and the reality does not match the policies set by the government.


Living in Bavaria I wonder what kinds of cuisine you can’t find here or how exactly the weather is treating you bad, given that the summer is long and warm and the winter is calm and mild.

> You don’t come here because it’s easy

Well, I can’t name another EU country with 5 (soon to be 3) years from entry to citizenship.

Also, this notorious bureaucracy - how often do you usually encounter it? In the period between applying for a Blue Card to changing a job I did it precisely 0 times. And it took me 2 days to switch jobs and pick up a new Zusatzblatt from Ausländerbehörde afterwards.


Every 3 years when I need to justify my right to live here. For the freelance visa this means a lot of preparation, and a fight for nonexistent appointments so that I can fire my documents into the void.

I earn a living from documenting German bureaucracy and helping immigrants to settle here, so I have a right to be sour.

It's a lot worse for employees because switching jobs involves a 3-5 month bureaucratic lag during which they don't know what will happen to their family. You might be dealing with a much faster immigration office.


> You don't come here because it's easy and things just work.

Partially.

It's doesn't work inside Germany, but it's much easier to get into Germany than the U.S. or other countries.

And they need that, the huge language disadvantage needs to be countered somehow, which they are doing on the invitation front, but not enough inside Germany.

And since these people aren't in the voting base, their issues don't matter at all to the government or the candidates.

It also doesn't help that socialist Taxes aren't exactly popular with high performers, the people Germany and other countries are competing for.


> And since these people aren't in the voting base, their issues don't matter at all to the government or the candidates.

I think you never heard about lobbying. Even if their issues could matter, they don't pay for it to be pushed on the agenda.


True, but that works for companies and rich people, not your average developer or economic migrant.


| And for what? The payoff just isn't there. You don't come for the great food, the great weather or the warm people. You don't come here because it's easy and things just work. You don't come here for the salaries.

Tell me more about this


Germany is a good country to live in, but it's hard to highlight anything as a reason to choose it. It's just average at a lot of things.


Are you an immigrant ? If yes, What are the problems that you are facing currently ?


I am. All the problems, since I write about them for a living (see my profile).

Right now, a Künstlersozialkasse application that has been pending for over a year (each reply takes two months or more, by post). Soon the renewal of my freelance visa, which will take anywhere between 3 and 9 months with no possibility of knowing what's going on.

I've been here for a while so my life is rather stable. When you move there with a family though? It's hell for a while.


Well I can only talk about the tech sector, but basically companies in DE/AT complain that they can't find senior+ engineers for 45k/year (pre-tax) for years now - the salary ranges have been kind of a joke (even at the top end) for quite some time and the whole discussion about the labour shortage is a political straw man.


salaries for tech workers are a joke in DE/AT when accounted for cost of living, taxes and what other professionals are making. the incentives do not match the work put in, hence why they can't find people and are in constant state of "wonder".

what seems to be the way to go is people ladder hopping every 2 years to make it to a managerial level, because when you not a manager you are nothing in Germany salary wise. the tech worker career track simply does not exist.


Real wages everywhere are stagnant.

Higher salaries are eroded by high cost of living and higher taxes


Problem for that region isn’t that wages aren’t growing. The issue is that they are very low to begin with. France for instance pays senior engineers much better. Poland pays better when adjusting for cost of living. Germany is on average not competitive even within its own region.


A junior at AWS in Poland makes more than the 45k listed above.


Not surprising but even outside of FAANG companies in Europe you can get a much better deal in another country


45k is a joke. Mid level engs at aws hit 90k+.


Many public sector positions in tech are paying this much


45k? how much is it after taxes for a family of 3?


Depends if on the setup.

If you are married, it depends on what your partner earns.

If you are not married, after tax and social contributions (health insurance, unemployment insurance, state retirement fund and some other insurance) roughly 30k. Your kid is health insured for free. And you will get some money from the state each month for the kid.

Also at least 20 days of PTO, parental leave and a lot of potential sick leave (20d/y if you have a kid) for that purpose alone.


Addendum:

IT sector seems to have an average of 75k in the former West, 58k in the former east.

From my experience, ~42k was an entry level job with a bachelor degree in the east.


Around half of it is what you get out, +/- around 5% depending on whose the more earning party.

In Germany if you marry you get the option to either both stay Steuerklasse 1/4 or you get to downgrade one which has to pay a little less taxes while the other one stays higher taxed.

Patriarchially that's why married women always earn less in their Steuerklasse 5 (even if they would be paid the same) because they pay the more taxes, so that the husbands in Steuerklasse 3 pay less taxes.

Not making this up, in case you want to smash that slur button.

Oh, and it also is only useful when one party (statistically the husband) makes 60% or more of the combined income because all untaxed Freibeträge are always accounted to the one with the better income in a Gemeinsamer Güterstand.


Not entirely true. In the end, you pay taxes from the yearly household income and the tax class does not change that. Tax class can only regulate how much of that you pay per month during the year. If you pay excess, you get it back with next year’s tax return. If you paid less than you had to, you’ll have to pay that difference. It makes zero sense to switch to 3/5 if you earn the same - literally zero benefit.


https://allaboutberlin.com/tools/tax-calculator

I built it to answer this question


for a single it's 2400€ net


So true and traurig.


Talking about the whole labour market is not useful in this case. There are labour shortages in trades, because they do not pay well, so Germans these days prefer to go to university. One of these "trades" is nursing, btw. Other such trades include elderly care.

The German labour market is also very peculiar. Employers are very risk averse so even though they might be lacking personnel they are not willing to hire easily, partly because firing people is also not easy. Then there is the obvious hurdle: most jobs require German.

Finally, in many job markets, like IT for example, there is a shortage of skilled professionals and an abundance of new graduates. And oftentimes employers are not willing to take on a new graduate and train them. So for example there are a number of C++ positions looking for people with 5+ years of professional experience which won't give a new graduate a chance.


Sounds exactly like the labour market in Finland. The shortage is there, but only for jobs that either don't pay livable wage (or have junior-level pay to seniors), have horrible working conditions, or both. Doctors are the only exception, they have good pay and decent working conditions, and the shortage is caused by successful lobbying to keep university intake low.


I don't see the risk. It seems German companies are making weak offers with "probation periods" even for international hires. One problem might be that such offers are not very attractive.


The probation period is pretty standard. Once you're through it you become much harder to fire, and your job becomes quite secure.


It's pretty bold to give a trial period to an international hire. Employment security is a good thing, and since wages are much lower than in the US, there is not much risk.


Every country does it, except countries with no job security. The notice period of two weeks is more than Americans and Canadians give as a courtesy. What is the alternative, hiring everyone forever?


That's very courteous, 28 days is plenty of time to find a new tech job. A real courtesy would be a golden parachute worth at least 6 months wages if you get laid off without cause. That's probably not more than a US sign-on bonus.

The alternative is giving real contracts to international hires, who already have a proven track record (otherwise why would you hire internationally).

Trial contracts were meant for people straight out of college, but in a race to the bottom some companies have started pushing that line further and further, even having people move across the world for temp contracts. You can't complain about labor shortage while behaving like that.


You don't seem to understand German work contracts well if you compare them to temp contracts.

The probation period also applies to you, the employee, if you choose that a company is not for you. Once that period is over, a three month notice period is quite common, so both you and the employer are locked into a relationship.

The probation period balances out how stable employment is once you both agreed that you're a match.


You don't seem to understand them. German law does not force you to have a three month notice period at the start of your employment, you can negotiate for a shorter period without the at-will part.


Why employers don't want to train fresh German graduates? Makes no sense


Probably because most new grads suck and have very low skill ceilings.


It is possible to identify candidates with low skills but high potential who can be trained. But most hiring managers are too lazy and incompetent to do this so instead they take the easy route of filtering based on education and work experience. Back in the early days of computing before it was really taught in most universities, IBM used to hire programming trainees based on the results of an aptitude exam. This worked pretty well and a similar approach could still be used today.


No, it's because as soon as they are trained they move on. And an increasing salary doesn't stop that.

People want to job hop to build up a diverse experience and no company wants to be the mug that pays an engineer during their bad years so that someone else gets to take advantage of it.


Mamy (most?) people would prefer to not have to job hop if the meager slary increases didn't make it almost mandatory. Even then, many people stay because they hate the idea of changing jobs so much.


I am - on paper - a new grad, but I am [demonstrably] outperforming not only everyone on my "level" in my org, but most at the level above me.

This sector's obsession with YOE as a metric of skill and thinking that nearly every new grad is useless is insulting.


Isn't it directly related to it's being an investment than to hire staff? You can't expect inexperienced people to do work that an experienced person has to do. So to train means you need to have the main work carried out by an experienced person, you have extra training capacity, and over on this you have funds to hire new graduate to train. You also would not expect a return on this investment quick.


Labor shortage relative to what? As usually pointed out, there is no fixed amount of labor that the geographic region of 'Germany' has to perform. It's the people there that need labor performed, and adding more people will also increase the labor needed (as well as infrastructure, housing, food, education, etc..)

So it's more accurate to talk of a demographic crisis, in the case that there are not enough young people to support the old. But given that Germany is one of the richest countries in the world, that's not the case. Because if it were, labor would be reallocated from high-profit fields to lower-profit but more necessary ones, like nursing and healthcare.


Wages didn't grow with inflation and nobody is dumb enough to take the jobs.


Off topic, but FYI Euronews was basically bought by Orban a few years ago.


Some context for the curious https://www.politico.eu/article/euronews-independence-buyout...


Do you have a source for that? Wikipedia says it has multiple owners from many different countries.


https://en.wikipedia.org/wiki/Euronews#2022–2023:_Alpac_Capi...


Thanks!! Makes lot of sense


There are several reasons to this.

"Arbeitsbeschaffungsmaßnahme" (job creation) is a one. Amount of people employed has higher priority than efficiency. So instead of having 5 people doing everything efficiently companies hire 50 to do everything manually for food. If the company wants to do things efficiently, the other reason kicks in: psychological inability to pay competitive salary, so most of the companies in Germany don't have access to competent engineers and management.


It's just a lobbying method. Companies will keep whining that they can't find employees while simultaneously refusing to pay fair salaries.


Whenever I see a documentation asking people about this than it's the money.

One guy makes now 2k after tax by working for a small wine seller.

He was head of the bar for over 10 years and made LESS before!

And not having any stable schedule.

Same with bakers: the good one came up with a strategy to do much less work at night and is able to find people the other one didn't change a thing.

Also in Germany it's quite common to become an engineer (metal etc) and software is still very abstract for a lot of people.

The deindustrialization thing is independent of this I think and correlates more to Germany not having any real greener resources besides coal.

There were company owner interviewed who just complained about how instable the energy is but instead of investing anything and doing something about it he prefers to create a new company location in Sweden. Which is actually not bad in my opinion we don't need to have every industry in Germany just to have it.

Germany is a dense country. And in Sachsen there is space but not much Industrie and a lot of Nazis (you know poorer and less educated people who are right wing) and I don't want to move there either.


Sachsen regularily scores top education marks. Source: https://www.insm-bildungsmonitor.de/

Berlin, which is very diverse, is the second lowest. Nordrhein-Westfalen is also very far down.

The votes for the right wing party AFD correlate with education level.


And? This doesn't tell you who is voting.

It only tells you that plenty uneducated vote because you can count the votes for afd.


Now look at a voter map on any issue, and you'll see exactly where the GDR was.


The jobs where there are shortages are not industrial, I guess? It is the same in the uk, lots of shortages in jobs that are not jobs in the way you think of a job.


Also NL, unless you’re freelancing. Some suggest it might be because of CAO (collective agreements) that fossilize wages down to pre-housing bubble rates.




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