Revamped chance map for attracting jobseeking migrants.
The shortage of skilled labor is a serious issue in the German economy, with significant gaps that need to be filled. To address this, the government plans to bring in foreign workers through regulated labor migration. Currently, opportunities for this exist through the Chance Card.
For years, the German labor market has relied heavily on people with foreign roots. In 2021, the number of residence permits for employed foreigners from non-EU countries increased by 68,000 to 419,000. However, the skilled labor and workforce shortage continues to grow. The government wants Germany to become as successful as countries like Canada, New Zealand, or Australia in attracting skilled workers. Now, the third part of the Skilled Immigration Act is being implemented, which brings:
How many skilled workers does Germany need?
By 2035, German society will be aging, meaning that seven million skilled workers will need to be replaced. The shortage is particularly acute in the care sector and the catering industry. There are also a lack of IT specialists in many companies and authorities. Although there were only 707,000 open positions reported by the Federal Employment Agency in March, 70,000 fewer than the previous year, it is expected that more and more positions will remain unfilled. According to Economy Minister Robert Habeck, the extent to which this can be filled depends on whether Germany can grow and maintain prosperity. Currently, about a quarter of all employees have a migration background, particularly in cleaning professions and the catering industry.
What's new from June 1st?
The Chance Card, which was decided as part of the Skilled Immigration Act last year, is being enacted. This is aimed at people who are not from the European Union. This new feature in the Residence Act is designed to make it easier for qualified workers to come to Germany. Having a contract with a German employer is not a prerequisite. Additionally, from June 1st, the opportunities for workers from the Western Balkan countries to come to Germany for a job will be expanded. This can also benefit unskilled workers. However, all those who want to enter under the so-called West Balkan Rule must present a job contract first.
How does the Chance Card work?
"We focus on language skills, qualifications, and experience to attract motivated and talented people to Germany," says Interior Minister Nancy Faeser. The requirement is a two-year vocational training or a university degree from the country of origin, along with language skills in German or English. Depending on language skills, professional experience, age, and Germany connection, interested parties receive points that entitle them to the Chance Card. There are also points for qualifications in shortage occupations. With the card, non-EU nationals can come to Germany and have a year to find a permanent job. Under certain circumstances, a one-time extension of two years is possible.
This regulation simplifies access to the German labor market for citizens of Albania, Bosnia and Herzegovina, Kosovo, North Macedonia, Montenegro, and Serbia. So far, for workers from these countries who have a job offer, the Federal Employment Agency has granted 25,000 approvals per year. This quota is to be doubled to 50,000 annual approvals.
Is the Skilled Immigration Act no longer valid?
Germany has had a Skilled Immigration Act since March 2020, which the grand coalition introduced to promote the influx of qualified workers from non-EU countries. Experts believe that its impact was limited due to travel restrictions during the pandemic and the high level of bureaucracy for migrant workers. In November of last year, the first part of the Skilled Immigration Act reform passed by the traffic light coalition came into effect. The initial adjustments mainly concerned simplifications for the "Blue Card EU" and for recognized skilled workers.
What changes have been in effect since March?
Residence based on professional experience - a key element of the Skilled Immigration Act - has been in place since March. Skilled workers with a degree and professional experience can enter Germany and work without prior recognition. They should have no acknowledged qualification in Germany, though. This should reduce bureaucracy and speed up procedures. The job offer in Germany must guarantee a gross annual salary of at least 40,770 euros, or the salary according to the tariff contract if the employer is bound by one. A limited temporary employment has also been made possible. The Federal Employment Agency has established a quota of 25,000 for this for the year 2024.
Will these changes attract more workers to Germany?
The options for immigration are now as diverse as the needs of the companies, says Labor Minister Heil. However, there are also high demands and bureaucratic hurdles, as well as other challenges. As a result, SPD migration commissioner Reem Alabali-Radovan is strongly advocating for "smart, digital administrative procedures," "integration from the start in kindergartens, German courses, or the labor market," and "consistent anti-racism." Amid a labor shortage of over 400,000 people per year, the Chance Card is primarily an opportunity for Germany, says Green interior politician Misbah Khan. The country must implement these changes effectively and become even more attractive as an immigration destination.
Apart from language barriers, what else gives migrants the jitters?
In contrast to other renowned immigration nations, Germany's tax system and its burdens are quite high. The negative impact on highly-skilled individuals is significant. Moreover, there are reports of difficulty in finding reasonably priced housing in certain metropolitan areas. Almost ridiculously, certain municipalities have been heard demanding employment guarantees from landlords for new foreign arrivals.
"Legislative efforts are far from over," states Ann-Veruschka Jurisch, an FDP MP focusing on internal affairs in the German parliament. "We aim to streamline migration legislation; it's a work in progress." She holds high expectations for the implementation of artificial intelligence in processing applications from prospective economic migrants. The Foreign Office has already taken the lead in this domain. This is essential - waiting periods stretching beyond a year are not something Germany can sustain.
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In light of Germany's skills shortage, especially in sectors like healthcare and IT, the Canadian immigration law could serve as a model for addressing the issue. Germany's annual need for skilled workers is projected to be around seven million by 2035, and the government is considering raising the minimum wage to attract and retain talent. However, this could lead to controversial discussions about the impact on small businesses and overall economic growth.
