The evolution of the German labour market

    Why is Germany dominating the European job market? The labour market in Germany is rumoured to be one of the most generous in Europe, and in many cases/industries, in the world.

    9th Mar 2018
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    In 2017, the German job market hit a new record. The overall employment rates across the country increased by 1.5 percent, and approximately 700,000 new jobs were created in 2017 across the country. The country is considered to be the strongest economy in Europe, but since 2007, 2017 offered the biggest number of new jobs created. Not only the German population seems to appreciate and recognise the profitability of the labour market here, but also an increasing number of immigrants who choose to relocate here due to the increased number of work opportunities. 

    Until recently, the employment rates were affected by a negative demographic, but the vast influx of foreign workers seem to balance the natural negative natality – thus employment – rates.

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    How is the labour market in Germany anticipated to evolve?

    The labour market here knew a constant growth for the last 12 years. The employment conditions seem to be more and more favourable for the workers, who can now easily find full-time, better-paying jobs, that cover social security and medical insurance policies. As reported by the European Commission, in 2017, Germany was one of the Member States with the lowest job vacancy rates in the European Union (2.7%). The most prosperous sectors in Germany are divided between the service sector (generating almost 70% of the GDP in 2017), followed by the manufacturing sector (more than 25% of the GDP generated in 2017).

     The sectors with a low percentage of the GDP are the agriculture sector and the construction sector. Regardless, in all of the industries above, the job market is a generous one.

    However, the number of advertising jobs, for instance, is higher, as the service sector is a bigger, more productive one. The same rule seems to apply to the entire service sector. The labour market in Germany is truly a generous one.

    A Pan-European job market with a great emphasis on social security

    Also, the job market across the country seems to be a pan-European oriented one, in an attempt of increased rates of inclusion for all residents here. Regardless of citizenship, the vast majority of the residents in Germany seem to have equal employment opportunities. These residents benefit enormously by the incredibly benevolent social security system available here, in which everybody that is legally working in Germany has the right to receive minimal living conditions, even in the case of job loss. This usually means that in a case of job loss, the former employee will receive a 70% security payment out of their wage for one year

    This provides the necessary living conditions and time for the former employee to search and find another job. And with a labour market so generous and inclusive, the impossibility of finding another job is an unlikely prospect.

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    89% of the German workers are satisfied with their jobs

    In one of Europe’s most powerful economies, the number of employees that claim to be satisfied with their jobs is an incredible one. According to Deutsche Welle, almost 90% of the workers in Germany have a similar opinion on their jobs. With an average of 30 days of paid vacation yearly, considerably less (official!) hours worked yearly than the Europe average (approx. 1600 hours worked yearly, as opposed to approx. 1700) and an economy untouched by the global financial crisis in 2008, the phenomenon is easy to understand. And still, the German economy and labour market seem to be a utopia. Think of the fact that the average American worker spends yearly with 400 hours more at their jobs, in a struggling economy. 

    So, what is making the German job market and economy so successful? Well, the acceleration imposed by the Eurozone demand for German services and products seems to be one of the factors. This contributed to the creation of numerous jobs in 2017, across a variety of sectors.

    • The public service sector created more than 200,000 jobs in 2017;

    • The business service sector created more than 150,000 jobs in 2017;

    • The retail and hospitality sector created more than 110,000 jobs in the same year;

    • The construction sector also boomed in terms of number of jobs created, being fuelled by the construction development;

    In 2018, the German economy and number of jobs created are expected to increase by more than 2.5 percent (economy) and the employment is expected to rise to almost 45 million in 2018, and even more in 2019.

    The matter of the German language and the job market

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    Some of the biggest companies in banking, technology, IT and pharmaceuticals are of German origin. Naturally, the demand for German-speaking workforce is at a peak. German is a language that is difficult to learn, and even if the foreign workforce has some basics, the vast majority is unwilling to perfect it and reach a proficiency level (written/spoke German). Large companies here are currently paying big money to various recruitment agencies all over Europe in their journey of finding highly trained professionals that also happen to speak German at an advanced level. This happens, however, in the case of a certain type of jobs, such as high-level administrative or managing positions in large companies. In smaller enterprises, the demand for a perfect German isn’t as high; conversational level is enough for many of the open positions.

    However, there can be observed a major imbalance between the positions demanding for German-speaking specialists (more than 20%) and the actual number of German-speakers (only 8%).

    Conclusion

    Without a trace of a doubt, Germany is one of the leading economies that generate an incredible number of jobs on a yearly basis. In an economy that doesn’t seem to stop growing, the demand for trained, capable personnel across all industries and sectors is steadily rising. 

    The social security system available here seems to be one of the encouraging factors that immigrants take into consideration when deciding to relocate in the biggest economy in Europe. 
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