Klaus Schrader: Challenging the shortage of skilled workers

The shortage of skilled workers has become the focus of political and public attention in Germany as a major obstacle to future economic development. It is foreseeable that the working-age population will shrink rapidly and that shortages will occur in an increasing number of professions. The significant decline in the labor force is due to the fact that the baby boomers of the post-war period will retire by the mid-2030s. At the same time, the demand for labor will not decline to the same extent as the supply of labor, resulting in a growing surplus demand. Bottleneck analyses show that there will be a shortage of workers in almost all sectors and that bottlenecks will affect a large number of occupational groups at all skill levels.

The shortages of skilled workers, specialists and experts are particularly evident in the economically strong German states in the south of Germany - Baden-Württemberg and Bavaria - where the widespread demand for qualified workers is obviously difficult to meet. But even in the economically weak Baltic Sea federal state of Mecklenburg-Vorpommern, the bottlenecks are above average, which points to the lack of attractiveness of this region. In the second Baltic Sea federal state of Schleswig-Holstein, the bottlenecks are below average, but due to the comparatively narrow economic foundation in the north, sectors that have a comparatively high demand for skilled labor in other federal states are underrepresented here. This means that structural weaknesses and a shortage of skilled workers come together at the German Baltic Sea, which could accelerate an economic downward spiral.

However, Germany is not alone in facing this future challenge: the shortage of skilled workers is also seen as a key problem for European economies at EU level. In addition to the shortage of workers, a skills mismatch is increasingly being observed in a growing number of sectors and professions. Against this backdrop, the recommended political solutions hardly differ from policies in Germany: at the European level, too, there is no "flagship instrument" for reducing the shortage of skilled workers, but rather a broad package of measures and the involvement of a large number of stakeholders is recommended. On the one hand, it is up to employers to create greater incentives for people to enter the labor market, work longer hours and immigrate by offering wages and attractive working conditions in line with these shortages. On the other hand, it is a government task to relieve the burden on labor income and further develop the necessary infrastructure in the areas of education and childcare. In Germany, however, it is not only the central government that has regulatory powers in these fields; the federal states also have a wide range of labor market related policy instruments at their disposal.

As the shortage of skilled workers is a cross-border problem in the EU, international cooperation can lead to superior solutions. Due to relevant regional competencies in Germany and Denmark, cooperation between the German federal state of Schleswig-Holstein and the Danish region of Syddanmark would make sense on the edge of the western Baltic Sea. In Schleswig-Holstein, there is a general shortage of skilled workers among people who have completed an apprenticeship or graduated from technical schools, with a particular focus on skilled workers in nursing and medical professions, construction, logistics, trade, the hospitality sector and other tourism services. In the case of higher qualifications, activities in technical professions, in the IT sector and in higher-value services are added. This development in Schleswig-Holstein of shortages is similar to the situation in the southern Danish labor market regions.

With a view to these similarities in Schleswig-Holstein and Southern Denmark the idea of a coordinated labor market policy appears to be obvious that could go beyond the previous approaches to creating an integrated labor market in the border region. In the course of closer cooperation, imbalances in regional submarkets could be overcome more easily through cross-border matching. Moreover, even with comparable bottlenecks on both sides of the border, an integrated labor market could generate "critical masses" in terms of placement as well as education and training, leading to an expansion of labor market policy options on both sides. This would increase the attractiveness of the joint labor market region and promote adhesion effects among local trainees, graduates and skilled workers. In addition, a larger, borderless labor market would be more visible and attractive to the outside world, which would facilitate qualified immigration. In the western Baltic Sea region, labor market cooperation could develop into a driver for further economic integration besides projects in the areas of transport infrastructure or energy supply.