(de-news.net) – As a result of targeted legislative reforms and persistent structural labor shortages across multiple sectors, labor migration to Germany from non-EU countries has expanded substantially since 2020. This trend reflects both deliberate policy adjustments aimed at increasing labor supply and broader demographic pressures associated with workforce aging and declining domestic labor availability. According to figures published by the Bundesagentur für Arbeit, approximately 420,000 non-EU nationals holding valid residency or settlement permits were employed in positions subject to mandatory social insurance contributions as of June of the previous year. This represented a marked increase from just over 200,000 such workers recorded in 2020, underscoring the rapid pace of change within a relatively short period. The agency attributed the primary cause of this growth to regulatory liberalization measures, particularly those implemented under the Skilled Immigration Act, which systematically reduced administrative and legal barriers and facilitated more direct access for eligible foreign workers to the German labor market.
Federal Labor Minister Bärbel Bas (SPD) emphasized the structural economic importance of sustained labor migration, framing it as an essential component of Germany’s long-term labor market stabilization strategy. She indicated that the national economy depended on workers capable of contributing across a wide spectrum of occupations, ranging from technically specialized professions to essential manual and operational roles. Speaking at a migration and employment conference in Berlin, Bas observed that labor shortages had already become evident across numerous industries and geographic regions, affecting both industrial production and service delivery. She further argued that even the full mobilization of domestic labor reserves—including unemployed individuals, underemployed workers, and those outside the labor force—would be insufficient to fully offset structural imbalances arising from demographic decline. In this context, she advocated for the earlier development and institutionalization of structured migration pathways designed to facilitate labor inflows from non-EU countries, particularly given intensifying international competition from other aging economies pursuing comparable labor recruitment strategies.
Structural gaps due to labor market mismatches despite unemployment
Bas also rejected the assertion that the recruitment of foreign workers was incompatible with persistently elevated unemployment levels, which remained close to three million. She explained that labor market mismatches reflected underlying structural, occupational, and geographic disparities rather than a simple surplus of available labor. As a result, unemployed workers in one region or profession could not easily substitute for shortages in specialized or geographically distant sectors requiring different qualifications or training. These structural mismatches have become more pronounced amid evolving migration dynamics within the European Union. In particular, demographic attrition caused by the retirement of large postwar cohorts has significantly reduced the domestic labor supply. At the same time, migration patterns have shifted, with 2024 marking the first year in which net migration of EU citizens turned negative, as more EU nationals departed Germany than entered, thereby further intensifying labor supply constraints.
Vacancies decline sharply and foreign recruitment emerges as key stabilizer
Recent labor market data illustrate these shifting structural dynamics. Although unemployment was projected to exceed three million in early 2026, overall labor demand had declined relative to previously observed peak levels. The Institut für Arbeitsmarkt- und Berufsforschung reported approximately one million open positions in the third quarter of 2025, representing a substantial reduction from the nearly two million vacancies recorded less than three years earlier. This decline reflected broader economic moderation and cyclical adjustments in hiring activity. Nevertheless, Bas emphasized that net employment growth among foreign nationals was now driven exclusively by migrants from non-EU countries, highlighting their increasing structural importance to labor force stabilization. More than one million individuals from Ukraine and other major asylum-origin countries had successfully entered employment, providing measurable evidence of the growing role of migration in sustaining workforce participation and mitigating demographic contraction.
At the same time, Bas acknowledged that administrative complexity and procedural delays continued to present significant barriers for both employers and prospective migrant workers. Lengthy recognition processes, visa procedures, and regulatory requirements were identified as factors that could discourage participation and slow recruitment timelines. She indicated that the federal government was actively pursuing reforms aimed at accelerating and simplifying these procedures in order to improve Germany’s international competitiveness in attracting skilled labor. Within this broader policy framework, she characterized migration and employment policy as mutually reinforcing components of an integrated labor market strategy, emphasizing that labor migration should be understood not as a competing priority but as a complementary mechanism supporting economic stability and long-term workforce sustainability.
Indian and Balkan recruitment boost workforce supply
As a concrete illustration of targeted recruitment success, Bas highlighted the growing presence of skilled professionals from India in the German labor market. Since 2020, the number of Indian workers employed in Germany has more than doubled, reflecting both institutional recruitment efforts and favorable labor market integration outcomes. She noted that this group’s unemployment rate remained significantly below the national average, while median earnings exceeded overall benchmarks, indicating relatively strong labor market performance and integration. Bas further referred to a bilateral declaration signed by Chancellor Friedrich Merz and Prime Minister Narendra Modi, which aimed to expand recruitment cooperation, particularly in critical sectors such as health care where labor shortages remain especially acute. She added that continued ministerial-level engagement was intended to strengthen institutional pathways and improve long-term coordination mechanisms supporting skilled migration flows.
A substantial portion of non-EU employment growth has also been facilitated through the Western Balkans regulation, which accounted for more than one quarter of non-EU workers. This framework permits a defined number of individuals from participating countries to enter the German labor market regardless of formal qualification levels, provided that they possess a valid and legally recognized employment contract. By prioritizing employer demand and contractual employment relationships, the regulation has created a flexible recruitment channel capable of addressing labor shortages across a wide range of occupational categories. As a result, it has emerged as a critical policy instrument for supporting labor market adjustment and ensuring the continued functioning of key economic sectors facing persistent workforce deficits.
