By Oliver Bäte
Chief Executive Officer, Allianz SE
Chief Executive Officer, Allianz SE
Op-ed by Oliver Bäte from the “Handelsblatt”
Germany needs a completely different discussion about skilled labor
When we talk about the shortage of skilled workers as a drag on growth, the debate misses the real problem. Strictly speaking, Germany does not have a shortage of skilled workers. Rather, we have a shortage of skilled workers who can work enough hours and, above all, are motivated to work more. We now urgently need to restore an understanding that our prosperity also has something to do with the will to work to maintain it.
According to OECD data, there were 46 million people employed in Germany in 2023. However, they only worked about as many hours as the 39 million people employed in 1991. The main reason for this is the increased proportion of part-time workers. In this environment, that some trade unions want to make a name for themselves by demanding a reduction in working hours with full pay is bordering on the delusional.
Added to this is our chronically high level of sick leave. According to Techniker Krankenkasse (Editors note: Techniker Krankenkasse is a provider of statutory health insurance in Germany), Germany's employees took an average of 19.4 sick days in 2023. This is another increase of 0.4 days over the previous year and double the figure for 2008. Sick leave in Germany is thus well above the level in countries such as the United States, Canada and Switzerland. Swiss employees take only 7.6 sick days per year, and the trend is declining: in the prior year, the figure was still 9.2 days. Without the enormously high number of sick days, the German economy would not have shrunk by 0.3 percent last year, but would have grown by almost 0.5 percent. Without a shortage of skilled workers, German companies could generate 49 billion euros more at full capacity. In 2027, when the baby boomers retire, the deficit is likely to rise to over 70 billion euros. A devastating major loss for our economy.
The time has come for us as a society to decide: are we willing to work at least as much and as productively for our prosperity as is common in other industrialized countries? That means not only tackling part-time work, but also working more full-time. In Sweden and Switzerland, for example – neither of which are known as “exploitative regimes” – the average full-time worker works 300 hours more per year than in Germany. How can this be achieved? Above all, with the right incentives. Working more hours must be made easier and more worthwhile in Germany – at all levels.
The most important lever is female skilled workers, who disproportionately often work part-time. And often not by choice, but because we as a society fail to provide reliable and affordable all-day childcare.
The second lever is the approximately 630,000 young people who will not have found their way into the labor market on their own by 2024. At the same time, almost 70,000 apprenticeships remain unfilled and more than a quarter of apprentices drop out prematurely. The causes are very different, but we have to leverage this potential! That is why Allianz is participating, for example, in the non-profit initiative “Joblinge”, which aims to introduce 100,000 young people to the world of work through internships by 2030 – including in our company.
Thirdly, we are still making it too difficult for qualified immigrants to find their way to Germany. We have to make Germany attractive for talented people from abroad. This also means consistently thinking through the necessary administrative procedures from the point of view of the “customer”, streamlining them and digitizing them throughout.
And fourthly, we have to reduce the very high overall costs of illness to society, for example, by reintroducing the concept of personal responsibility into the healthcare system. As they do in Switzerland, for example, where policyholders contribute a fixed annual amount and a percentage of their treatment costs – even in the statutory health insurance system.
Don't get me wrong: health is one of our most precious possessions, and regular rest and relaxation is the key to avoiding illness. But we also have to make these privileges “affordable” in the long term. That's why we should focus our healthcare system much more on disease prevention.
But we shouldn't just encourage all those who currently work part-time or not at all to work more. We should also make it possible for those who voluntarily want to work more than 35 or 40 hours – and reward them for doing so. Of course, we still need a maximum limit in collective agreements and occupational safety laws. But this can vary depending on the job. A road construction worker, for example, is usually exhausted after eight hours. Other professions are not necessarily so.
Whether you work 30, 40 or 50 hours per week, overtime should always be worthwhile. Unfortunately, Germany's income tax system, with its aggressive progressive rates, has the opposite effect. And social security contributions make overtime a less attractive proposition for those skilled tradespeople and skilled workers on tight budgets whose incomes are in the medium range and thus below the income thresholds for social security contributions. A marginal tax rate of up to 50 percent is effectively a program to discourage work.
Tax breaks for overtime that exceeds full-time employment could help. And at the lower end of the income scale, I am in favor of recipients of the citizen's income being allowed to keep more of their additional income without it being offset against the citizen's income.
The recommendations at a glance:
- Incentives in the tax and social system must be consistently restructured so that working more pays more than it does now. In addition, the collectively agreed and legal limits on maximum working hours – scaled according to the field of work – should be relaxed for those employees who voluntarily want to work more.
- We must promote full-time work by creating all-day childcare options and affordable living space in all parts of Germany. Companies should not wait for the state to act, but must take more action themselves than they have done in the past.
- We must consistently tackle excessive sick leave and the associated costs – through better preventive healthcare and the right incentive systems.
About Allianz
The Allianz Group is one of the world's leading insurers and asset managers with around 128 million* private and corporate customers in nearly 70 countries. Allianz customers benefit from a broad range of personal and corporate insurance services, ranging from property, life and health insurance to assistance services to credit insurance and global business insurance. Allianz is one of the world’s largest investors, managing around 768 billion euros** on behalf of its insurance customers. Furthermore, our asset managers PIMCO and Allianz Global Investors manage about 1.9 trillion euros** of third-party assets. Thanks to our systematic integration of ecological and social criteria in our business processes and investment decisions, we are among the leaders in the insurance industry in the Dow Jones Sustainability Index. In 2024, over 156,000 employees achieved total business volume of 179.8 billion euros and an operating profit of 16.0 billion euros for the group.
* As of December 31, 2024. Including non-consolidated entities with Allianz customers.
** As of March 31, 2025.
** As of March 31, 2025.
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