Shortage of skilled workers particularly acute in East Germany

Berlin The German Economic Institute (IW) warns of an acute shortage of skilled workers in digitization professions in East Germany: “The new federal states are at risk of being left behind in digitization due to a lack of human capital,” says a study by the institute on behalf of the Federal Ministry of Economics, for which the IW analyst Alexander Burstedde evaluated data from the Federal Employment Agency. The bottlenecks in Germany are very unevenly distributed regionally. In the east, however, the job offer for digital experts is “significantly too low”.

The proportion of vacancies in digitization professions that cannot be filled purely mathematically – the so-called job overhang rate – was 55 percent in the eastern German non-city states in 2021. So there were no suitably qualified unemployed for every second vacancy. In 2020 it was still 49 percent. For comparison: In the city states, where recruitment in digitization professions is much easier, it was only 28 percent in 2021.

Across Germany, the IW estimates the shortage of skilled workers in digitization professions in September 2021 at around 77,000 people. At that time, there was no suitably qualified unemployed person for every second job vacancy. “Companies need significantly more digitization skills than the German labor market currently provides,” the institute sums up.

The problems in the IT area are part of the general shortage of workers in the so-called MINT area (mathematics, computer science, natural sciences and technology). According to the most recent MINT spring report by the IW, the skills gap was 320,600 in April, around twice as high as a year ago.

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There are now almost half a million vacancies nationwide for around 180,054 job seekers in a STEM profession. This is by no means just about academics – almost half of them relate to apprenticeships. “Without initial successes in immigration, the gap would be over 600,000,” write the researchers working with IW education expert Axel Plünnecke. In addition to IT, the biggest bottlenecks are in the energy and electrical professions.

More women in STEM jobs

As a result, research performance in Germany – measured in terms of patents – has increased in recent years “simply because the number of patent applications by inventors with foreign roots has increased,” said Plünnecke. The proportion of patent applications in digitization technologies has risen particularly sharply, namely from eight percent in 2010 to 14 percent in 2018. “In the telecommunications and IT industry group, the proportion of immigrants is even 22.5 percent.”

>> Read also: Every second MINT student drops out – Germany is running out of young techs

There has been little progress in efforts to lure more women into the mostly well-paid, but often male-dominated STEM professions: their share rose from 13.8 to 15.6 percent between 2012 and 2021. In total, 1,105,600 women now work in MINT professions. Here, the east is ahead with a proportion of women of 16.6 percent, in the west it is only 15.2 percent.

As a consequence of the findings, the IW advises getting young people excited about jobs with a shortage of skilled workers – through gender-neutral education, more internships and a shift in the range of publicly funded training and study places towards shortage occupations. “The digital change requires further development of vocational training,” says the study.

In addition, the unemployed should become “more mobile regionally and professionally”. With a view to immigrants, the IW recommends simplifying professional recognition and removing language barriers. “The recruitment of international specialists should be more active and service-oriented.”

Best recruitment opportunities exist in Berlin

Berlin is one of the regions in which the shortage of skilled workers is not so pronounced. According to the study, the job surplus rate in the capital is 25.7 percent, although there has been a very strong increase in employment in digitization professions. “Employers there are still relatively easy to find new workers,” says the study.

>> Read also: Foreign students – the untapped potential for Germany’s job market

Hamburg (23.2 percent) and Bremen (28.3 percent) are also “islands of good recruiting opportunities” compared to the surrounding areas. However, there are also large cities where digitization skills are rare. The study names Leipzig (60.1 percent) and Frankfurt (69.6 percent) in particular.

In the federal states, the job overhang rate is lowest in North Rhine-Westphalia (33.2 percent) and Baden-Württemberg (39.8 percent), just ahead of Schleswig-Holstein (39.9 percent). Recruiting staff with digitization skills is the most difficult in Mecklenburg-Western Pomerania (53.8 percent) and Thuringia (54.8 percent).

Digitization occupations include mechatronics technicians who build robots for industrial production, or IT system electronics technicians who plan and install information and telecommunications technology systems, for example. According to the IW study, the shortage of skilled workers was by far the greatest here. In September 2021, there were no suitably qualified unemployed persons for 70 percent of the vacancies in Germany.

By far the largest increase in employment from 2013 to 2020 was in IT professions (plus 41 percent). According to the IW, this is due in particular to the growth in experts with a master’s, diploma or similar qualification (plus 84.2 percent).

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But the demand for IT specialists with vocational training is also very high – their employment increased by 48 percent. “This can be seen as a success story for the training occupation of IT specialist, which with its now four disciplines seems to meet the needs of companies well,” summarizes the IW in its study.

Digitization jobs offer good earning potential

According to this, the greatest employment growth was among specialists in technical IT (plus 232.9 percent), experts in IT application consulting (plus 159.6 percent) and experts in software development (plus 99.1 percent).

According to the study, the increase in employment in the digital electrical professions is “strongly inhibited” by the ongoing shortage of skilled workers. This applies to so-called construction electricians, for example, even if not all vacancies have a digitization focus. Construction electricians should therefore primarily pursue classic construction activities, such as laying power lines and installing fuse boxes.

But you are also responsible for laying data lines and installing smart home systems. Aside from digitization, they also play an important role in climate protection, for example when they install wall boxes and photovoltaic systems.

The apprenticeship “Electronics technician for industrial engineering” is also considered to be particularly relevant for digitization. Experts from this field set up controls for automated systems or program programmable logic controllers (PLC) to control machines. “These activities are essential for the digitization of industry,” emphasizes the IW in its study. Experts in computer science are also relevant. According to IW, these are “a reservoir for new IT professions such as data scientists or machine learning engineers”.

According to the study, many digitization professions offer good earning opportunities: Young workers under 40 earn the most as managers for software development, who earned a median wage of 6,131 euros in 2020 (full-time gross). This is followed by experts in aerospace and automotive technology with 5,924 and 5,889 euros. At the “Specialist” requirement level, IT is the most lucrative at EUR 4,968.

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