Labor Shortage Germany’s Dropout Problem

Germany desperately needs more skilled workers, but too many young people in Europe’s largest economy fail to finish school, job training or university. Businesses and politicians are blaming each other for the problem.
Listen up class, today's lesson will be in austerity measures for Mediterranean countries.

You’d expect a country run by a trained physicist to have lofty educational goals. But apparently for many young German dropouts, aspirations were set too high.

“We want to halve the number of school dropouts by 2015 to four percent,” promised German Chancellor Angela Merkel after meeting with the country’s state premiers at a summit on education in 2008.

However, some seven years later, almost 6 percent of young people still start their working life without even a non-university track secondary school diploma. The numbers are even bleaker for vocational training: a quarter of all traineeships are terminated prematurely. And it’s even worse at the country’s universities, where about 28 percent of German undergraduates drop out.

“It is bad for the young people and bad for Germany as a place of business,” said Eric Schweitzer, president of the German Chamber of Industry and Commerce.

The problem is clear, but there is no consensus on the solution. Instead, the business community and politicians point the figure at each other.

Many businesses complain that young people simply are not mature enough for working life when they get out of school.

More high school graduates now start university studies than vocational training, and the number of college dropouts has risen accordingly

“School alone cannot be the repair shop of the nation,” Brunhild Kurth, the new head of a committee of state education ministers told Handelsblatt. Social workers are needed, not teachers, because the dropouts largely come from difficult family backgrounds, she said.

The trade unions see some of the blame for the misery with companies. For example, the fact that almost half of the trainees in the hotel and restaurant business give up has to do with “many businesses considering overtime, irregular working hours and low wages normal,” said Elke Hannack, vice chairwoman of the DGB federation of German trade unions.

But there is nevertheless agreement that young people need more guidance and support, so that they do not become dropouts in the first place. Ms. Kurth is urging Germany’s 16 states to spend the €1.2 million, or $1.37 million, from what they have saved since the federal government took over student and trainee financial aid known as BAföG.

The counselors who support young people in getting their secondary school diploma or in searching for an apprenticeship are paid for by the federal government and with resources from the European Social Fund. About €800 million goes toward a training program for the long-term unemployed without workable professional training. Employers who give them a chance receive wage subsidies.

The government wants to use money from the Federal Labor Agency and the job centers to create an additional 10,000 positions by this fall for “assisted training.” Apprentices are to be supported so they hold on until the end of their course.

By investing billions, the federal government is trying to get the dropout rate down, but it will also have to tackle the nation’s universities. Today, more high school graduates start university studies than vocational training, and the number of dropouts has risen accordingly.

It is a problem that was actually supposed to be solved by the so-called Bologna reforms. Politicians were convinced a decade ago that the new, short bachelor courses of study would automatically lead to more students finishing their education. For years they have waited for success, and have consoled themselves by blaming it on “transition difficulties.”

Now disillusionment is widespread. When almost 30 percent of the 600,000 freshmen drop out, then that translates to more than 170,000 young people who are frustrated and searching for alternatives.

German Dropouts-01

Most people think those with vocational training earn less or have worse career opportunities, said Lutz Goebel, president of the family-run business lobby group Die Familienunternehmer and managing director of the machine building company Henkelhausen. In addition, there is the persistent debate among politicians about the percentage of university graduates being too low, he said.

Mr. Goebel said he has some university dropouts working at his company, and they do a good job. “It is too bad that they did not immediately have the idea of doing an apprenticeship,” he said. “That would have saved a lot of time.”

And it might have saved many companies the difficult search for skilled young workers. According to the Federal Labor Agency, at the beginning of the training year in September there were about 37,000 vacant apprenticeships.

Companies are especially courting university dropouts. More than half of the trade chambers in Germany are already supporting joint projects with the colleges and universities. But Ms. Kurth does not expect that the dropout situation will have improved significantly by the next education summit. “An education system is like an ocean tanker,” she said. “Abrupt changes in course do not work.”

There still is some consolation: prominent figures such as ex-Deutsche Telekom boss René Obermann, rental car magnate Erich Sixt, former Foreign Minister Joschka Fischer and TV talk show host Günther Jauch prove how far you can still go in Germany after dropping out.


Barbara Gillmann and Frank Specht are reporters for Handelsblatt. To contact them: [email protected] and [email protected]