Wanted: Foreign Workers For Germany's Job Boom

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While the U.S., the U.K. and much of Europe brace for spending cuts and austerity, Germany is in the midst of an economic boom.

Germany has emerged from the financial crisis faster and in far better shape than the rest of Europe. The German growth rate almost doubled in the first quarter of 2011; corporate profits have soared, and industrial production is expected to keep growing — at least for the rest of this year.

But as manufacturers add extra shifts, there's a new shortage of skilled workers — and that's led to renewed calls to ease restrictions on immigration.

Economically speaking, Germany is a land of opportunity right now, especially for engineers and IT specialists. But with strict immigration laws and an abundance of red tape, work visas remain unissued, positions unfilled, and both German business and foreign skilled workers are losing out.

"We need 70,000 engineers, for instance," says Armin Laschet, the whip for the Christian Democratic Union in the state of North Rhine-Westphalia. The conservative CDU usually doesn't call for more immigration, but Laschet says that needs to change if Germany is to remain economically strong.

"If they don't come to Germany, we have in the future a problem, because our demographic situation is so that we are getting older as a society," Laschet says. "We need people from outside to come to Germany."

Laschet is chairman of a newly formed national working group of high-level German political and business leaders. Their mission is to get the government to move quickly to adopt a more business-friendly immigration policy.

Some restrictions on immigrant workers from Eastern Europe are set to expire next month, but Laschet says that's hardly enough. Non-European Union citizens still face huge hurdles.

Currently, most non-EU citizens have to be earning the equivalent of nearly $90,000 in order to qualify for a work visa. That rule disqualifies all but a small percentage of skilled workers.

The working group wants to lower the minimum income barrier and ease other restrictions, but Laschet recognizes that when it comes to immigration, not all hurdles are with laws and regulations.

"Germany has to change," he says. "We still have discrimination. We have not the diversity we need. I think this is what the German people, what the German state, has to learn: Diversity is richness and we need different cultures in our country."

A Seeker's Market At The Job Fair

The threat that the skills shortage poses to Germany's production lines is tangible. At a recent job fair inside a 1920s-era glass and metal exhibition hall on the outskirts of Dresden, the frantic ones weren't the job seekers so much as the companies worried about finding enough workers to fill key posts.

"The day is fully packed, and I'm very busy, but that's a very good problem to have, right?" says Hans Jurgen Neufing, a senior recruiter at Global Foundries, a Silicon Valley-based semiconductor supply firm with its European headquarters in Dresden. Neufing says his company is busy looking to hire some 1,500 people, including engineers and technicians, for its Dresden plant, as well as for manufacturing centers in Singapore and upstate New York.

"We are seeing a great boom right now, so our overall outlook for the economy and the semiconductor business is great," Neufing says. "We are hiring a very significant number of positions, and so we had to adapt our recruiting strategies to this amount of people coming on board."

It's not just global companies that are hiring in Germany; a centerpiece of the country's industrial economy are its "mittlestand" firms — often midsized, highly specialized companies that are usually family-owned and run. Trumpf is one such company; it produces industrial cutting and welding machines that help make everything from VW car parts to surgical tables and washing machine drums.

Half of Trumpf's 8,000 employees are in Germany. Nineteen-year-old Patrick Wiedemann wears a neatly pressed shirt and dress pants, his hair slicked back with gel. He's finishing a technician apprenticeship with Trumpf and will take up a full-time job with them next year. Wiedemann, who's from a rural village just outside of Dresden, is almost gleefully optimistic despite the fact that most of Europe is still slowly emerging from the worst recession in a generation.

"I'm not in the slightest bit worried about the future," he says. "I have absolute faith that my company will look after me. Crises happen, but machines will always need building."

Not All Jobs Are Created To Be Equal

New data show that the rate of German business growth is slowing down somewhat as a carefully watched business climate index fell in April. As one economist put it, "In face of the high oil prices, the Japanese crisis and other risks, it was to be expected that companies would not have quite such a rosy outlook anymore."

But labor union officials charge that, overall, recent German government efforts to deregulate and liberalize the employment market have led to a kind of Americanization of the job market. Real wages are stagnant.

Dirk Hirschel is chief economist at Germany's largest service sector trade union, Verdi. He says the last 10 years have seen a sharp rise in the number of temporary jobs without full benefits and the eradication of nearly 2.5 million full-time, permanent ones.

"The quality of jobs changed dramatically in the way that we have what we call 'precarious employment' in Germany," he says. "So we are talking about temporary jobs — jobs not connected to the social security system. Seven million people are working for less than 8 euros in Germany per hour. So we have the second-biggest low-wage sector behind the U.S."

Hershel says while the union is not opposed to bringing in more skilled foreign workers, the government could do a lot more at home to boost job quality and employment. He'll have time to get his point across. The high-level working group on immigration reform isn't due to present its proposals to Parliament until October.