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1. Labour market situation in the country

2. Main concepts

Labour market situation in the country

The German labour market

In Germany, being in employment is seen to be very important. Apart from providing a secure livelihood, it is crucial for social integration. German labour law offers strong protection against dismissal. Collective bargaining parties (on the employer side, associations of employers; on the employee side, the unions), play a central role in deciding wages, working hours and other working conditions. In the event of unemployment, employees are paid unemployment benefit (Arbeitslosengeld) or citizens' benefit (Bürgergeld).

According to statistics from the Federal Employment Agency (Bundesagentur für Arbeit), the overall unemployment rate in April 2025 was 6.4%, while the rate among 15 to 25-year-olds stood at 5.4%. This represents a slight increase from the previous year, 2024, when unemployment for the under-25 age group was 5.3%. However, there are significant regional differences. While conditions in the training market have improved in recent years from the perspective of training applicants, the proportion of young people without a vocational qualification among unemployed people under 25 remains high. A report published by the Federal Employment Agency in March 2025 (Bericht der BA) reveals that three-quarters of unemployed individuals under the age of 25 lack a vocational qualification. The absence of vocational training should therefore be considered a key risk factor.

One serious problem on the labour market, which has become increasingly apparent in recent years as a result of the demographic change, is the shortage of skilled labour. Companies are finding it increasingly difficult to satisfy their need for qualified workers. According to a study by the Bertelsmann Stiftung, this applies not only to the skilled trades, such as the heating, air conditioning, mechatronics and automation sectors, but to an increasing extent to healthcare, nursing and teaching professions. Government strategies to counteract these shortages include professional development and training programmes for employees, schemes facilitating the arrival of qualified skilled workers from abroad, but also improved career guidance services for young people. Given the skilled labour shortage, it is also important that young refugees can be integrated more easily into vocational training programmes and employment.

According to another study on the training prospects of young people with a low level of school education published by the Bertelsmann Stiftung and German Children and Youth Foundation (Deutsche Kinder- und Jugendstiftung) in September 2022, the career prospects of school-leavers with a lower school-leaving certificate (Hauptschulabschluss) play an important role. Altogether 17% of school-leavers in 2023 held this type of school-leaving certificate, while 7% left without any qualification at all. The proportion of young non-German nationals among all school leavers without a school-leaving certificate has increased over the years, reaching over one quarter in 2023. This group of individuals accounted for 11% of all school leavers. Even if around three quarters of these young people intended to complete an apprenticeship or training, a significant number ended up in a so-called transition system, where they completed pre-vocational training schemes and college-based courses. Given the growing number of unfilled training places, this should be considered a problem.

National studies and reports

The current situation on the labour and vocational training market in Germany is regularly monitored and the findings are published in the reports of the Federal Employment Agency, such as in the publication "Challenges for Young People in the Training and Labour Market" (Herausforderungen für junge Menschen am Ausbildungs- und Arbeitsmarkt), last published in March 2025.

A wide range of studies and specialist publications support the federal government's (Bund) labour market and education policy-making. In Germany, programmes and initiatives relating to vocational training and the labour market are systematically monitored and evaluated. The results of this monitoring process are published in the Vocational Education and Training Report (Berufsbildungsbericht), the data report (Datenreport) as a supplement to the Vocational Education and Training Report and the Education Report (Bildungsbericht), among others.

• The Federal Ministry of Education and Research (Bundesministerium für Bildung und Forschung, BMBF) submits an annual Vocational Education and Training Report (Berufsbildungsbericht), most recently in 2024. It describes the current situation on the vocational training market and provides an overview of the federal government's activities and programmes in the field of vocational education and training policy.
• The Vocational Education and Training Report is supplemented by the data report (Datenreport) issued by the Federal Institute for Vocational Education and Training (Bundesinstitut für Berufsbildung, BIBB), last published in 2024. The data report is the main source of information and data for the Vocational Education and Training Report. It illustrates developments in vocational training.
• Since 2006, the Federal Ministry of Education and Research has published its biannual report on education in Germany (National Bildungsbericht), most recently in 2024. It uses indicators to support the information it provides on the German education system as a whole, from early childhood education to adult education.
• The Federal Employment Agency's annual analysis of the skills shortage (Fachkräfteengpassanalyse) identifies professions where it is relatively difficult to fill registered vacancies as a result of the skills shortage. In 2020, results also became available for the federal states for the first time. The analysis is available for Germany as a whole, with the exception of occupational subgroups.
• The annual business reports (Geschäftsberichte) of the Federal Employment Agency (Bundesagentur für Arbeit, BA) provide information on the impact of labour market policy. The BA also produces a monthly report on the labour and training places market for under-25-year-olds.
• The Institute for Employment Research (Institut für Arbeitsmarkt- und Berufsforschung, IAB) of the Employment Agency carries out research into the labour market and professional world, and thus creates a basis for empirically founded labour market policies.

Main concepts

The federal government's skilled labour strategy (Fachkräftestrategie) is a response to structural changes and the related challenges of securing skilled labour and the labour market in Germany. It is one of the priorities of its labour market and educational policies. The aim of the federal government's skilled labour strategy is to put in place the conditions and develop specific support services for the labour market of the future.

A key element of the skilled labour strategy is also a skilled labour monitoring system (Fachkräftemonitoring), which provides projections on the skilled workforce development over the coming years. This system is based on the definition of skilled workers as employees with a completed, formally recognised vocational qualification.

To enable all young people without a vocational qualification to access vocational training that leads to full qualification, the Federal Ministry of Labour and Social Affairs (Bundesministerium für Arbeit und Soziales) has developed a comprehensive "training guarantee" (Ausbildungsgarantie). This includes a range of counselling and support services, from career orientation and counselling to targeted assistance with entering and successfully completing vocational training.

Another important response was the introduction of a statutory minimum wage (Mindestlohn) in Germany in 2015, which increased to €12.82 an hour in January 2022. The minimum wage is the lowest amount an employer can pay employees. The minimum wage is regulated by the Act Regulating a General Minimum Wage (Mindestlohngesetz) and is determined by the Minimum Wage Commission (Mindestlohnkommission).