Population growth with low unemployment

BIBB and IAB look ahead to the 2035 labour market in Germany

50/2018 | Bonn, 20.11.2018

Population growth with low unemployment

Despite the population increase caused by demographic change and the rise in labour supply associated with this, unemployment will fall long-term to an historically low level of around 1.1 million by the year 2035. This is one of the findings from the fifth wave of qualification and occupational field projections conducted under the joint leadership of the Federal Institute for Vocational Education and Training (BIBB) and the Institute for Employment Research (IAB) in collaboration with The Institute of Economic Structures Research (GWS). The results are presented in the latest issue of the BIBB REPORT series.

The significant gains from immigration over recent years mean that, contrary to earlier projections, the population in Germany will grow from its current 82.2 million and reach approximately 84 million by 2035. Over this period, the proportion of non-Germans in the population will increase from the present 12% to approximately 16.5%.

According to projections, the number of persons in gainful employment will rise by more than 800,000 to approximately 45.8 million by around the middle of the next decade. Due mainly to the labour supply which will then fall, as the baby boomer generation retire from working life, the number will then drop again to approximately 44.4 million by the year 2035.

In overall terms, the number of persons employed in manufacturing industries will reduce further by 2035. The shift from vocational specialisations towards service occupations will continue. The structure of employees’ qualifications is also changing. There will be a significant rise, for example, in skilled workers with upgrading training and bachelor’s degrees or degrees from universities of applied science.

The increasing number of older people will ensure that the largest proportion, 15.4%, of gainfully employed persons will be working in the health and social services sector in 2035, closely followed by the processing industries with a proportion of 15.2%. In absolute terms, the greatest shortages in skilled workers will be in the medical and caring occupations due to the sustained high demand. The number of young people will once again begin to rise and, as a result, there will also be increased demand for education and teaching services.

Even though labour shortages across the board are not apparent when taking into account the most recent trends, there is very likely to be a shortage of skilled workers in specific occupations. Besides the health care occupations, this will especially be the case in some occupations in the skilled trades sector and in the agricultural occupations.

In occupational groups with a wide range of access opportunities for individuals with non-occupation specific qualifications or without professional qualifications, however, searching for work will be highly competitive. This applies for example to occupations in retail, in catering and cleaning, and in warehousing and logistics, whereas ongoing structural change will also reduce labour demand in accounting and controlling.

The qualification and occupational field projections from BIBB and IAB enable statements to be made at regular intervals on future trends while taking into account current events and knowledge. The uncertainty associated with the projections requires ongoing re-evaluation of the general conditions and of their effect on the results of the projections.

Further information: BIBB REPORT 7/2018 “Population growth with low unemployment. Results of the fifth wave of qualification and occupational field projections to the year 2035”. The issue can be downloaded free of charge at www.bibb.de/bibbreport (German only).

Detailed results for a total of 141 occupational groups can be accessed at www.qube-data.de (German only).

Specimen copy requested if printed.