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Ukrainian refugees push up German unemployment rate

Germany's unemployment rate rose for the first time in two years in June, figures published Thursday showed, as refugees fleeing Russia's war on Ukraine swelled the pool of job seekers.

People attend a job fair in Berlin aimed at Ukrainian refugees.
People attend a job fair in Berlin aimed at Ukrainian refugees. Photo: picture alliance/dpa | Christoph Soeder

The indicator rose to 5.3 percent on a seasonally adjusted basis, up from five percent in May, according to the BA federal labour agency.

Overall the number of unemployed rose by 133,000, also on a seasonally adjusted basis.

The sharp increase was due to the “extensive registration of Ukrainian refugees at job centres”, the BA said in a statement.

People escaping the conflict started by Russian President Vladimir Putin in February were now “visible” in employment statistics, BA chief, Detlef Scheele said in a statement.

Over five million Ukrainians have been registered as refugees in Europe according to the UNHCR, with hundreds of thousands finding their way to Germany.

But not all of them have found work corresponding to their qualifications, with the German language also creating a significant barrier.

Worker shortage goes up

At the same time, several sectors were facing shortages of workers, with 877,000 vacant posts, up 184,000 from the same month last year.

“Many companies are desperately seeking skilled workers,” said Fritzi Koehler-Geib, chief economist at the public lender KfW.

The shortage was particularly acute for skilled positions, Koehler-Geib said.

“This is a vulnerability of the German economy that has been building for a long time,” she said.

READ ALSO: Germany struggles with growing worker shortage 

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WORKING IN GERMANY

EXPLAINED: The German industries ‘most affected’ by skilled worker shortage

Germany's shortage of skilled workers has reached a new high with almost half of firms struggling with staff shortages, according to a survey.

EXPLAINED: The German industries 'most affected' by skilled worker shortage

In July, 49.7 percent of companies surveyed by the Munich-based Ifo Institute said they were affected by the lack of skilled workers. 

This is the highest figure since researchers launched their quarterly survey in 2009. The previous record was 43.6 percent in April.

“More and more companies are having to cut back on business because they simply can’t find enough staff,” said Stefan Sauer, a labour market expert at the ifo Institute.

“In the medium and long term, this problem is likely to become more severe.”

READ ALSO:

Since the survey started, the problem has increased significantly. At the beginning, around 10 percent of businesses reported being affected by worker shortages. But by 2019 this had climbed into the range of around 30 percent. 

The Covid crisis caused a temporary slump, but since the beginning of 2021, numbers have been rising significantly.

Service providers most affected

The service sector is the most affected with 54.2 percent of companies saying they are struggling to fill vacancies, up from 47.7 percent in April. Within this group, accommodation and event industries came in above this sector average at around 64 percent. In warehousing and storage, 62.4 percent of firms were affected. 

The service sector is followed by manufacturing, with 44.5 percent of companies saying they can’t find staff. Within that group, 58.1 percent of food manufacturers said they faced problems caused by staff shortages. Around 57 percent of manufacturers of data processing equipment and of metal products are also having difficulty finding qualified staff.

In the retail sector, 41.9 percent of companies say they have problems with a lack of staff. In construction that figure is 39.3 percent and in wholesale, it’s 36.3 percent.

The pharmaceutical and chemical industries report the lowest shortage of skilled workers, with 17.2 and 24.1 percent of companies respectively reporting that they are affected by staff shortages.

The automotive industry is also below average with 30.5 percent of firms reporting issues with staffing, as is mechanical engineering, with 43 percent.

Germany’s labour shortage is causing major concerns. A report by the IAB Institute for Employment Research from earlier this year found 1.74 million vacant positions across the country. 

The president of the German Confederation of Skilled Crafts and Small Businesses, Hans Peter Wollseifer, recently spoke out about the issues. According to Wollseifer, the skilled crafts sector in Germany alone lacks at least a quarter of a million qualified employees.

Meanwhile, between 15,000 and 20,000 apprenticeship places remain unfilled every year, signalling problems for the future. 

As The Local has been reporting, the government is pushing ahead with plans to reform immigration law in a bid to attract talent from abroad to fill jobs.

“We want to make it easier and faster for foreign skilled workers to find their way to Germany,” said Interior Minister Nancy Faeser and Labour Minister Hubertus Heil (both SPD) recently.

The plans for a reform of immigration law could be presented as early as autumn.

READ ALSO: 

Vocabulary

Skilled workers – (die) Fachkräfte

Labour market – (der) Arbeitsmarkt

High/peak – (der) Höchststand

Service providers – (die) Dienstleister

Temporary employment – (die) Zeitarbeit 

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.

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