Instruments and methods for a successful integration of international workforce to reduce the skilled labor shortage in Germany E-Book

Daniel Weber

• Herausgeber: GRIN Publishing
• Kategorie: Fachliteratur
• Sprache: Englisch
• Veröffentlichungsjahr: 2016

Beschreibung

Bachelor Thesis from the year 2016 in the subject Business economics - Business Management, Corporate Governance, grade: 1,7, University of applied sciences, Siegen, language: English, abstract: The German population structure is facing an aging population and low birth rates. Since the 1970s, birth rates already undercut the number of necessary children to preserve the population. Since the end of the 1990s the yearly birthrate is 1.4 children per woman. Germany’s population has been declining since 2004 and scientists predict that the children’s generation will be one third smaller than the parents’ one. Without substantial migration the age structure will change significantly. In 2008, Germanys’ working-age population (20-65 years old) was at 60.6 per cent. From 2030 on this number will decrease to 54.5 per cent. At the same time, the number of people older than 65 years will increase from 20.4 to 28.8 per cent. This development is provoking substantial problems in social and retirement systems, since a growing number of people are making use of insurance benefits and less people of the working generation contribute to raise the financial resources. Another major problem is the increasing gap on the employment market, because not the whole leaving workforce can be replaced with adequate personnel. Scientists predict that in the next 20 years 13.4 million people are leaving the working life but only 7.2 million jobs can be filled with young national professionals. Under this condition, an estimated number of 6.2 million job vacancies cannot be filled until 2035. In order to reduce the negative consequences of the dramatic development on the German labor market, and to maintain and raise the competitiveness of the German economy, it is indispensable to activate additional skilled worker potential. The focus of the thesis is to elaborate a framework of tools and methods for a successful integration of international personnel to reduce the labor shortage of German companies. To reach this goal, different specific characteristics of the target group are examined. The research provides an analysis of the historical, political, economic and regional situation in terms of lack of labor to expose fundamental knowledge about the issue in different occupational groups. This analysis serves as a basis to understand which industries are facing a mismatch of labor and what kind of specific professionals are required.

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Index

List of abbreviations

List of figures

List of tables

1 Introduction

1.1 Problem statement and research question

1.2 Objective of thesis

1.3 Methodology

1.4 Structure of thesis and contents

2 Fundamental analysis of current state

2.1 Definition of skilled labor shortage

2.2 Analysis of German labor market

2.3 Particularities of selected professions and industries

2.3.1 Technical experts

2.3.2 Health care sector

2.3.3 Non-academic professions

3 Foreign employees in Germany

3.1 Historical development of labor migration

3.2 Current migration regulations

3.3 Chances to reduce the lack of skilled labor

4 Key factors for integration of international workforce

4.1 Identification of target group

4.1.1 Recruiting agencies

4.1.2 Business websites and social networks

4.1.3 Recognition of foreign qualifications

4.2 Origin of foreign employees

4.2.1 Active recruitment of job candidates from abroad

4.2.2 Foreign employees in Germany

4.3 Language

4.3.1 Language courses

4.3.2 Workplace-related language trainings

4.4 Culture clash

4.5 Costs

4.6 Sustainability

4.7 Interim conclusion and summary

5 Instruments for successful integration

5.1 Welcome culture

5.1.1 Explanation of term

5.1.2 Application in the organization

5.2 Mentoring

5.2.1 Explanation of term

5.2.2 Application in the organization

5.3 Employer attractiveness

5.3.1 Explanation of term

5.3.2 Application in the organization

6 Conclusion

6.1 Findings and limitation of the study

6.2 Suggestions for further research

6.3 Outlook

7 Appendices

List of literature

List of abbreviations

List of figures

Figure 1: Structure of thesis and contents (Source: Own illustration)

Figure 2: Vacancy length of occupational groups

Figure 3: Search strategy for foreign skilled workers

Figure 4: The three pillars of Welcome culture

Figure 5: Factors of employer attractiveness

List of tables

Table 1: Overview of services for a recognition of foreign qualifications

Table 2: Important countries for international recruitment

Table 3: Overview of key factors for integration of international workforce

1 Introduction

1.1 Problem statement and research question

One of the most essential factors for economic success of any business is the disposability of highly skilled labor.[1] Filling job vacancies with qualified professionals is an ever increasing challenge for many Human Resources managers (HR managers). The already existing skill shortage in many industries is not a cyclical problem that will eventually cure itself, therefore it has to be considered as a structural phenomenon. One of the fundamental reasons is based on demographic changes. Germany[2] is one of the fastest-aging and fastest-shrinking nation among OECD[3] countries.[4] The German population structure is facing an aging population and low birth rates. Since the 1970s, birth rates already undercut the number of necessary children to preserve the population. Since the end of the 1990s the yearly birthrate is 1.4 children per woman.[5] Germany’s population has been declining since 2004[6] and scientists predict that the children’s generation will be one third smaller than the parents’ one. Without substantial migration the age structure will change significantly.[7]

In 2008, Germanys’ working-age population (20-65 years old) was at 60.6 per cent. From 2030 on this number will decrease to 54.5 per cent. At the same time, the number of people older than 65 years will increase from 20.4 to 28.8 per cent.[8] This development is provoking substantial problems in social and retirement systems, since a growing number of people are making use of insurance benefits and less people of the working generation contribute to raise the financial resources. Another major problem is the increasing gap on the employment market, because not the whole leaving workforce can be replaced with adequate personnel.[9]

Scientists predict that in the next 20 years 13.4 million people are leaving the working life but only 7.2 million jobs can be filled with young national professionals. Under this condition, an estimated number of 6.2 million job vacancies cannot be filled until 2035.[10]

In order to reduce the negative consequences of the dramatic development on the German labor market, and to maintain and raise the competitiveness of the German economy, it is indispensable to activate additional skilled worker potential.[11] This task can be a tremendous challenge, especially for those businesses that are not used to work internationally, such as the public service or locally positioned enterprises.[12] A set of practical tools and methods for the integration of international employees could especially help those companies that are not used to recruit international employees.

The situation on the German labor market is not likely to improve. What began as an unfavorable demographic situation is gradually converting into a serious growing labor shortage.[13] Because of technological innovations, globalization and the required knowledge in many professions, the demand of qualified workforce is increasing.[14] In August 2015 there was already a shortfall of 156,200 skilled workers in the so-called STEM fields (science, technology, engineering, mathematics). Half of these unfilled positions regards to workers with an academic diploma or vocational qualification.[15]

The idea to reduce the lack of workforce in Germany through immigration is not a new one. As a consequence of the economic miracle in the 1960s and early 1970s until the first oil shock in 1973, Germany invited mostly South European guest workers, mainly in blue collar jobs,[16] to make up for the labor shortage.[17] After decades of a more restricted immigration policy at the turn of the 21st century a commission led by former Bundestag President Rita Süssmuth pointed out the need of recruiting immigrant workers and introduced a special work permission called “Greencard” for foreign IT-experts. As a second milestone a national office of immigration and integration was created. Several new types of visas for labor immigration where introduced to grant highly skilled workers from outside the European Union access to the German employment market.[18] Today Germany’s policy for highly skilled migrants is one of the most open among the OECD-countries. In international comparison the procedure is inexpensive as well as fast and refusal rates are low.[19] The experiences of the past years with skilled labor migration demonstrate that the simple implementation of migration-friendly regulations is not the only solution in order to attract foreign employees.[20] From the expected 20,000 IT-experts only 18.000 could be recruited through the implemented German Greencard in its four years of existence from 2000 to 2004.[21] It is rather necessary for companies to address the effort of recruitment directly to the international group of workers. This includes contacting potential candidates in foreign countries or contacting foreigners, that already live in Germany such as international students and offering them immigration friendly framework conditions to integrate them into the German labor market and make them feel welcome in the new country.[22]

A fundamental question in the process of integrating foreign workforce is that of how the German authorities use their power to shape the legal base. Are they reducing bureaucracy or are they creating obstacles for interested and urgently needed candidates looking for attractive job vacancies on the German labor market. Germany is one possible option for international high potential professionals and every country is bidding in a global competition for the best talents.[23] The Government plays an important role in converting Germany into an attractive immigration country for highly skilled and trained personnel.[24]

If legal conditions of employing international staff are established as it is the case today in Germany,[25] companies have the opportunity to benefit from it. This task implies a lot of effort of management and working teams regarding the needs of international employees.[26] Managers have to develop methods to identify adequate candidates and integrate them into the working system. In this context important questions have to be answered such as how companies can identify the right international personnel and which foreign countries employees should come from. Another pivotal question is how newcomers can effectively be integrated into the working process, so that they can be a sustainable solution to reduce the labor shortage of the German labor market.

1.2 Objective of thesis

The focus of the thesis is to elaborate a framework of tools and methods for a successful integration of international personnel to reduce the labor shortage of German companies. To reach this goal, different specific characteristics of the target group are examined. The research provides an analysis of the historical, political, economic and regional situation in terms of lack of labor to expose fundamental knowledge about the issue in different occupational groups. This analysis serves as a basis to understand which industries are facing a mismatch of labor and what kind of specific professionals are required. The economic significance of foreign employees for the German labor market has been confirmed by numerous publications. The thesis evaluates the essential aspects of the inclusion of foreign workforce and puts important information into a new set of arguments. The political discussion of the issue and the implementation of new migration-friendly labor market regulations demonstrate that politicians have been trying to provide better basic conditions in order to help affected industry sectors. Including foreign labor may generate some particular challenges that have to be considered. Understanding the problems and experiences of the last decades can give important insight into how the integration of foreign professionals can best be achieved. A repertory of fundamental examples and recommendations should give both practically relevant as well as scientifically based assistance to identify adequate candidates, fill job vacancies with perfectly skilled people and integrate them at long-term perspective.

1.3 Methodology

As the thesis requires detailed research about the past and present situation of the German labor market, labor migration and labor migration policy, the method is based on qualitative and quantitative investigation. Several officially recognized statistics provide the quantitative details. The theoretical background forms the basic knowledge of the thesis. It is based on academic literature, articles of scientific journals, laws and labor market regulations with corresponding commentaries. As the characteristic of the subject is influenced by highly dynamic and constantly changing factors, the inclusion of internet publications and press releases is mandatory to embrace the requirements in terms of currentness of data. The purpose of the theoretical part of the thesis is on the one hand to discuss important terminologies by clarifying general definitions and ideas and examine the initial situation. On the other hand, the comprehension of historical development of the German labor market and migration policy up to the present-day is crucial to match the empirical insight. Several expert interviews provide in addition to the literature research the possibility to obtain practical knowledge of the needs for applicable models, theories and ideas of the thesis. A selection of the previous conclusions is incorporated to complement empirical results and discuss the research question.

1.4 Structure of thesis and contents

The thesis is divided into six chapters. The introduction (chapter 1) includes the subchapters problem statement and research question (chapter 1.1), objective of thesis (chapter 1.2) and methodology (chapter 1.3). The second chapter provides a fundamental analysis of current state with a definition of the term “skilled labor shortage” (chapter 2.1) and an analysis of the German labor market (chapter 2.2). The chapter closes with an overview of particularities of selected professions and industries (chapter 2.3) such as technical experts (chapter 2.3.1), health care professionals (chapter 2.3.2) and non-academic professions (chapter 2.3.2). Chapter 3 is dedicated to the issue of foreign employees in Germany. Chapter 3.1 contains information about the historical development of labor migration, chapter 3.2 analyses current migration regulations and chapter 3.3 presents chances to reduce the lack of skilled labor.

Chapter 4 presents key factors for integration of international workforce. The identification of target group (chapter 4.1) can be realized with assistance of recruiting agencies (chapter 4.1.1) and through utilization of business websites und social networks (chapter 4.1.2). The recognition of foreign qualifications (chapter 4.1.3) is a crucial factor for successful integration. Chapter 4.2 provides information about the origin of foreign personnel. International job candidates can be actively recruited abroad (chapter 4.2.1) or companies can make use of foreign employees that already live in Germany (chapter 4.2.2). A fundamental basis to work in most professions is knowledge of the German language (chapter 4.3). Language courses (chapter 4.3.1) and workplace related language trainings (chapter 4.3.2) help to improve German skills. Other key factors for a successful integration are how to deal with a possible culture clash (chapter 4.4), calculation of the costs (chapter 4.5) and sustainability of international recruitment. Chapter 4 closes with an interim conclusion and a summary of the findings (chapter 4.7).

Chapter 5 is dedicated to instruments for successful integration. The first topic of the chapter mentions so called “welcome culture” (chapter 5.1) including an explanation of the term (chapter 5.1.1) and its application in the organization (chapter 5.1.2). The second field of chapter 5 is mentoring (chapter 5.2) with a definition of the term (chapter 5.2.1) and the introduction of this measure into the system (chapter 5.2.2). The third part (chapter 5.3) explains the term employer attractiveness (chapter 5.3.1). An application in the organization (chapter 5.3.2) occurs through job benefits (chapter 5.3.2.1), family oriented benefits (chapter 5.3.2.2) and attractiveness of workplace location (chapter 5.3.2.3).

The thesis closes in chapter 6 with a summary of the findings and limitation of the study (chapter 6.1), suggestions for further research (chapter 6.2) and an outlook (chapter 6.3).

Figure 1: Structure of thesis and contents (Source: Own illustration)