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WORKING IN GERMANY

Germany struggles with growing worker shortage

Germany is grappling with a growing worker shortage across the entire job market.

Published: 2 June 2022 16:38 CEST
A notice board in front says a restaurant in Schwerin is looking for staff in the service and kitchen areas.
A notice board in front says a restaurant in Schwerin is looking for staff in the service and kitchen areas. Photo: picture alliance/dpa/dpa-Zentralbild | Jens Büttner

In the first quarter of this year, the shortage of skilled workers in Germany reached record levels.

In March the number of vacancies rose to a new high of 558,000, said the Competence Centre for Securing Skilled Labour (KOFA) last month. 

It means that the skilled labour gap widened by 88,000 vacancies within just three months.

As The Local has been reporting, Germany has been trying to plug its worker gap. In 2020 the government eased some immigration laws to help attract workers – and the new government plans to go even further. 

READ ALSO: What Germany’s plans for a points-based immigration system means for foreigners

In order to deal with labour shortages, Germany needs around 400,000 new workers every year, according to the Federal Employment Agency.

Job vacancies across the board

According to the recent study by KOFA, the growing shortage of skilled workers is affecting the entire labour market.

However, the shortages are particularly large in the health, social services, teaching and education sectors, as well as in the construction, architecture, engineering, surveying, and building services.

A sign on a Frankfurt restaurant says staff are being sought.

A sign on a Frankfurt restaurant says staff are being sought. Photo: picture alliance/dpa | Sebastian Gollnow

READ ALSO: 10 things you need to know about Germany’s law to attract skilled foreign workers

In the areas of health, social services, teaching and education alone, around six out of 10 jobs are unfilled.

There are also above average vacancies in the fields of raw material extraction, production and manufacturing, natural sciences, geography and IT, as well as agriculture, forestry and horticulture.

The number of vacancies for qualified applicants in aviation and energy technology occupations has also increased sharply recently.

Another study – the KfW-ifo Skilled Workers Barometer May 2022 – also said economic sectors are affected by shortages, including legal and tax advisors plus auditors. 

“The shortage of skilled workers has again become a growing challenge for Germany’s future,” said the KFW research.

“A large proportion of companies are affected. Tensions in international trade relations and disruptions in supply chains will continue to put pressure on the export economy, on which about a quarter of all jobs in Germany depend.

EXPLAINED: The 25 most in-demand jobs in Germany

“At the same time, the shortage of skilled workers in important sectors of the economy such as the skilled trades or health care is expected to worsen due to demographic change. And digitalisation will have a major influence on which skills will be in demand in the future.”

Festivals call for staff

Other industries are also affected by staff shortages. Festival organisers as well as restaurant, cafe and bar managers in Germany are struggling to fill positions.

Part of the problem was that lockdowns and closures saw hospitality staff endure months of Kurzarbeit (reduced working hours) in 2020 and 2021. By the time the bars, cafes and restaurants reopened, many had found work in different sectors or were reluctant to return to them. 

Long hours, anti-social times of work, unstable contracts and lower pay also generally make the hospitality sector less attractive to potential employees. 

Some festivals in Germany are even having to beg for workers this summer. 

At the end of April, the organisers of the “Umsonst & Draußen” festival in Würzburg made a dramatic appeal to the public – they called for 300 workers to help put the festival on. 

Organiser Ralf Duggen said that students, who usually take summer jobs, were not coming forward to work after two years of cancelled festivals. 

READ ALSO: Working in Germany – 7 factors that can affect how much you’re paid

Vocabulary

Skilled workers – (die) Fachkräfte

Vacancies – (die) offenen Stellen

Skilled labour gap – (die) Fachkräftelücke

Above average – überdurchschnittlich

We’re aiming to help our readers improve their German by translating vocabulary from some of our news stories. Did you find this article useful? Let us know.

Member comments

  1. As an EU-educated midwife with a BSc and MSc (so much more highly qualified than the German apprenticeship program), I cannot work here until I have a B2 German certificate. But recent refugees from the Ukraine, who are not EU educated (i.e. the regulated EU-wide curriculum for registered nurses and midwives) can work right away without a word of German. I fully support this initiative and think it’s great, but surely other skilled workers should have the same rights? In my home country we had Polish nurses coming to us with hardly any English and within a few months of working in an English-speaking environment, they were fluent. I have no doubt the same would be true here for me, but I am not afforded the opportunity while the nation laments about the lack of nurses and midwives. Hmmm.

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For members

TAXES

EXPLAINED: How do you close down a freelance business in Germany?

Leaving the country? Got a steady job offer you can’t say no to? Winding down your self-employment activities in Germany still requires taking a few bureaucratic steps.

Published: 15 May 2024 09:07 CEST
Updated: 15 May 2024 10:57 CEST
EXPLAINED: How do you close down a freelance business in Germany?

Striking out on your own as self-employed is one of the scariest – and potentially most rewarding things – you can do. In Germany, it also comes with its own set of rules around tax and social insurance.

But there are times when – for whatever reason – it may be time to move on.

Whether it’s because you have an exciting new opportunity or things haven’t quite worked out the way you hoped due to economic pressures – winding down self-employment the right way is crucial to avoid gaps in your health and social insurance coverage in Germany.

The steps you have to take are also a bit different depending on if you are new self-employed (Freiberufler) or have a trade licence (Gewerbe) – with some steps not being necessary for new self-employed.

Trade licences are automatically cancelled if the licenced person dies or the company ceases to have financial assets.

Resigning the trade licence or declaring it dormant

New self-employed people like writers or speakers don’t need to go through this step, as they don’t need a trade licence.

Those who have a trade licence will need to contact their competent local authority and resign it, or declare it dormant (withdrawing the licence). If you’re only winding down temporarily, declaring your trade licence dormant instead of de-registering completely may save you a few headaches later.

You may have to do this in person at your local trade office – or Gewerbeamt – depending on whether your local authority allows online de-registration or not. You’ll need to bring your official ID, trade licence, confirmation of registration and possibly an extract from the trade register. Fees are dependent on your local authority and can range from being free to €25.

You can declare the date you intend to resign the licence – which can be in the future. To ensure no gaps in your social insurance protections, including health insurance, set this date for the day before whatever comes next. For example, if you’re starting a new job on January 1st set the date for your trade licence to expire as December 31st.

The trade office will typically notify your local tax office, so you won’t need to do this yourself.

Notifying your tax office

If you’ve had to resign your trade licence, you can skip this step as your trade office will do it for you. If you’re a Freiberufler without a trade licence you need to resign, you’ll have to notify your local Finanzamt, or tax office, yourself.

Luckily, this is a pretty easy step.

First, you need to decide whether you’re ceasing operations completely or wanting to continue them part-time. If you’re ceasing completely, you’ll end up surrendering your self-employed tax number.

You don’t have to do this though. If you think you may still carry on some self-employed business as a side gig, you can inform the tax office that you intend to do so and keep your number.

At that point, the tax office should treat you as a Kleinunternehmer – or a small business making less than €22,000 a year. Having this status means that you will not need to pre-pay taxes or charge VAT on your invoices for freelance side projects.

If you derive any income from your side gig in the future though, you’ll still have to file a tax return.

READ ALSO: Can I have a freelance side gig as an employee in Germany?

Notifying your health insurance

While different private plans in Germany may have different notification requirements, if you have public health insurance in Germany, you should notify them that you’re winding up your self-employed business. Specifically, advise them exactly what date you’re wrapping up.

Again, this should be right before you start your new job or leave the country, to ensure no gaps in your coverage.

If ending your self-employment in Germany, take care to ensure that there’s no gaps in your health insurance coverage, by giving the right date for when you’re ceasing activity. You don’t want to be caught without coverage. Photo by Stephen Andrews on Unsplash

If you are in an artistic profession and thus pay pension, health, and nursing insurance through the Artist Social Insurance Fund (KSK), you should also advise them as well. If you’re leaving self-employment completely, you can typically give notice to KSK as to when it’s ending.

If you’re not, and intend to still make money freelancing as a side gig, they should know this as well. In this event, you’ll no longer pay health or care insurance through KSK, as this is covered through your main job.

You may need to continue to pay pension contributions through KSK based on the amount of money you still make from self-employed activities — depending on how much of them you continue.

KSK: How creative freelancers can pay less for German health insurance

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