June 25, 2012

At the beginning of June, Germany’s labour minister Ursula von der Leyen, economics minister Philipp Rösler and Federal Employment Agency (BA) head Frank-Juergen Weise gave the go-ahead for a joint national and international campaign designed to help secure German business a pool of skilled labour large enough to meet the country's needs on a long-term horizon.

These efforts – including in particular the recruitment of skilled labour from abroad – are necessary, albeit insufficient. According to the BA, there will be a shortfall of roughly 6 million workers in Germany by 2025, which would severely hamper progress in the German business sector, especially for the Mittelstand (small and medium-sized enterprises). Looking far down the road and in light of the 5 ½ million young people between the ages of 14 and 25 who were out of work in the European Union in March 2012, the campaign gives rise to hopes that also strategic efforts are being taken to design and offer next-generation educational opportunities. For, in the long run, all of Europe will experience skills shortages unless more effort is poured into improving education and further training. The European Centre for the Development of Vocational Training (CEDEFOP) assumes that over 83 million new jobs will be created in Europe over the next 12 years (including 8 million jobs in entirely new areas, many based on knowledge-intensive production). However, these vacancies will be increasingly hard to fill as many people are not sufficiently or not suitably qualified for the new requirements. This is due, among other things, to the trend towards more competence-intensive jobs at all levels of employment. Many traditional manual or routine jobs will continue to decline in importance.

In times of more intelligent, hybrid products offering tangible technologies enriched with service features, such as smart grids or smart homes, traditional (master) craftsmen, technology companies and social service providers are all faced with entirely new challenges: in order to meet the new requirements they will have to quicken the pace at which they further develop their own structures and their employees in their skill and competence levels.

To hold their own in the future, skilled workers should, in this context, be able to fall back on a well-founded general education. In addition, people should be willing and able to learn new skills and enjoy doing so. Life-long learning will accompany many people with changing professions and vocations. This is a particular challenge for people who – like many in Spain these days – join the ranks of the unemployed after having completed school. They have no alternative today but to further qualify themselves by starting vocational training. To help these youths in Spain, in particular, but also many young people in Germany, we urgently require an initiative for more and better-tailored educational opportunities. After all, today’s 15 to 24-year-olds belong to a new generation of skilled workers. They are joined by many older workers who are seeking a new orientation in their careers. They, too, can (further) educate themselves with properly tailored programmes.

Germany and Denmark can make major contributions in this respect. Already today, the two countries are setting the agenda in various regions and across borders by instituting cooperative, cluster-oriented forms of dual education and by further developing the dual education system. They are giving young people new prospects. This was one finding of the “First European Business Forum on Vocational Training” of the European Commission, which invited Deutsche Bank Research to moderate the exchange of expert views on best practices. It emerged, for instance, that several major German technology companies collaborate in Portugal to foster the new generation of skilled workers by offering practical competences in mechatronics and other knowledge of key importance to the automobile industry.

In Denmark, too, a lot is being done for the new generation of skilled workers. Education and further training are values in their own right for Danish companies – and cooperation a virtue. To illustrate: in order to hold his own in tough international competition on cost and quality, one Danish pumpmaker is not confining investment in education to his own future skills pool. He is also having his key suppliers participate in these training programmes. With this “cluster model” he manages to provide the apprentices with greater insights into the shape of future jobs, spark interest in technology, broaden the skilled labour pool in the region and, above all, be internationally competitive – thanks partly to his highly skilled staff.

Given customers’ increasing demands on the quality of products and services and the steadily decreasing prices of the same, companies can only remain competitive if the staff members use their initiative and do their job well. To enable them to do so, companies will also have to become more innovative in their education and further training offers. The reason is that the new generation of skilled workers also wishes to have new forms of learning. This is indicated by the latest findings of the Institute for Work, Skills and Training (IAQ) at the University of Duisburg-Essen. An innovation in the form of the dual study programme – a hybrid method in which learners obtain vocational certification in the dual system of vocational education and training parallel to an academic degree at university – has proved a success. The number of dual study programmes grew by over 70% between 2005 and 2011, to 929. Over 61,000 students have used this option to acquire an education that is both integrated and modular. Obviously, what counts for today’s generation of students is practical relevance. But not only for them – also for their future employers: in a survey of companies conducted by Germany’s Federal Institute for Vocational Education and Training (BIBB) 45% of the firms said they would have jobs for all their apprentices in dual study programmes once they graduated.

Efforts should be taken to build on these achievements. The German government and the state governments – together with the companies actively offering education and further training opportunities as well as the trade unions and employers’ associations in Germany – ought to consider ways to develop education and further training into an independent branch of value creation. This should be done in collaboration with their European partners. Considering the metamorphosis of many products and the stiffening competition on costs and quality, new forms of education and further training are going to be required in future to spark younger and older generations’ interest in technology-related fields. Modular forms of learning will be needed that will enable people to get a taste of different areas while consolidating and expanding their basic competences and expertise via coordinated forms of learning. But what is also needed are strategic ways to cooperate on the design and funding of education and further training, as is practised in Denmark and by German manufacturers in Portugal. In this context, so-called “impact investment funds” offer the possibility of investing on a long-term horizon in competences with near-term effects: offering young people new prospects and competences instead of unemployment is the solution. Such models should be rolled out in collaboration with partners in European countries such as Spain and Portugal, too, in order to create good solutions – via joint educational opportunities – especially for this generation and coming generations of skilled workers.

Modern education and further training offers have the potential, as one of the 21st century services, to become a resounding export success for Germany and several other countries of Europe. People with their ideas and industry are a valuable asset in Germany as well as in Europe. Europe must urgently utilise this asset if the social market economy is to continue to thrive. Prospects for vocational development, opportunities for earning a living and pursuing a successful career based on ideas and competences are a fundamental pillar of functional coexistence in society. Promoting this policy is the right way to respond to the crisis. Therefore, it is to be hoped that more will be done to supplement Germany’s Qualified Professionals Initiative by pursuing an innovation and growth initiative in the area of education and further training.

See also:

Bräuninger, Dieter (2012): New stimulus for Germany’s skilled workers market. Talking point. May 30, 2012. Deutsche Bank Research.

CEDEFOP (European Centre for the Development of Vocational Training) (2012): Europe’s skill challenge. Briefing Note March 2012.

Krone, Sirikit/Mill, Ulrich (2012): Dual studieren im Blick: Das ausbildungsintegrierende Studium aus der Perspektive der Studierenden. IAQ Report 2012/03. Universität Duisburg-Essen.

Rollwagen, Ingo (2012): Chancen für “Bildung Made in Germany“ - Globaler Wettlauf um Fachkräfte. In: W&B 03/04.2012. Deutsche Berufsbildung: Exportschlager oder Ausverkauf?, pp. 10-15.

Zum European business forum on vocational training, 07/06/2012 - 08/06/2012. In: http://eutrainingforum.teamwork.fr/en/programme.

Dr. Ingo Rollwagen (+49) 69 910-31814

 

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