Johannes Schneider Johannes.Schneider at
Thu Feb 22 02:15:14 MST 2001

> In Britain, the government have already started the process of inviting in
> 10,000 computer workers, mainly from India. There is no formal shortage of
> people in these areas as it is a massive growth area for employment and
> education. It is more the case that the computer industry feels that wages
> are too high and this is a good way of reducing them by recruiting
> >from abroad and paying them less.

Here is the latest from today's

Green Card Initiative Masks Problems in German Labor Market

By Claudia Bröll

Will the German government's so-called Green Card initiative, which calls
for 5-year temporary residency and work permits for up to 20,000 highly
qualified workers from outside the European Union, ever manage to bring in
enough IT specialists to accommodate the high-tech sector?

The project has now taken on Sisyphean dimensions: never-ending and
hopeless. Hardly is one project dealt with before it re-emerges on an even
larger scale. German Chancellor Gerhard Schröder and Labor Minister Walter
Riester must feel like Homer's hero whenever they try solving Germany's
shortage of specialized workers.

Last August, the number of specialists needed by the information and
communications sector was estimated at 75,000. The Chancellor's intent was
to cover this need and overcome the growing information technology (IT)
industry's single greatest barrier to expansion by introducing the

But now, 18 months on, business is squawking again and even louder than
before. A look at the success of the Green Card program is sobering. The
Employment Office has issued fewer than 5,000 temporary visas. At the same
time, nobody knows for sure how many of these specialists are actually still
in Germany. The need for high-tech workers remains at around 75,000, says
Bitkom, an industrial lobby for that sector.

All the trumpeting about the program's success does little to camouflage the
fact that Green Cards are little more than a drop in the bucket. The IT
segment is not the only industry working the Chancellor to draw attention to
their personnel plight. VDMA, the German machinery industry association,
puts its engineer shortage at up to 12,000, while its sister organization in
the chemical industry, VCI, speaks of a 500-600 staff shortfall. The
cleaning and food services industries have also now chimed in with
significant shortages of skilled laborers.

Big companies in the consumer goods industry or service industries, once
able to attract staff on name alone, are unable to fill spots. It began with
a need for programmers. Now it encompasses machinery makers, engineers,
natural scientists and economists. Searching for personnel doesn't suffice
any more. It has become "a fight for talent."

Against this background, Chancellor Schröder's call to extend the Green Card
program to other industries seems futile. Is it likely to be any more
successful in multiple sectors when it has failed in the original one?
Unlike when Mr. Schröder announced the surprising first initiative, it
hardly amazes that business leaders are reacting cautiously this time round.
Critics call it a "mend-and-make-do approach."

There has been more acceptance for the suggestion that foreign students be
offered work permits when they finish their studies in Germany. However,
everyone is waiting for Mr. Schröder's special commission on immigration to
present its findings to parliament in summer. So far, the commission has
expressed moderate sympathy for expanding the Green Card initiative and
spoken out against immigration quotas.

The commission can hardly be envied its task. It has to steer between
political caution and economic need, while avoiding being overwhelmed by
clamoring industry lobbyists or losing sight of why there is even a shortage
of specialists in the first place.

The reasons may seem obvious at first glance: The high-tech and services
industries have grown at an accelerated pace in recent years. Turnover in
the IT industry alone last year rose by 40 percent. As a result, businesses
where nothing is more valuable than an idea have seen their personnel needs
go up too.

The labor supply, however, is steady or dropping. The reasons for this can
be found in demographic shifts, misguided approaches to education and the
wrong incentives to work.

When in many countries, including India, children were learning to work with
computers in the 1980s, IT was still considered exotic in Germany. Both
educationalists and industrialists overlooked the first signs of a new and
upcoming industry and failed to give students the right signals. The
establishment of new and elite colleges for specific areas was also
overlooked. Competition among universities which would advance quality of
education is still lacking.

While the reaction came too late for IT specialists, engineers have been
experiencing what teachers have been going through for years. When order
intake at machinery and electrical engineering companies is up, students in
those courses are highly prized. By the time they finish their studies,
however, business is likely to have receded. One can read of unemployment
among engineers in the papers again.

A less cyclical and more forward-looking approach to hiring would do much to
combat this, obviating the need to call on overseas personnel to fill the

Finding solutions for the widening discrepancy between supply and demand for
labor is difficult. Immigration may do something to cover the shortage of
specialists in the short term, but root causes will have to be addressed at
some point. This implies a reform of the schooling system, closer
cooperation between universities and industry and, not least, greater
incentives to work if enough people are to be found in Germany to fill even
the lower-skilled jobs.

Need-based immigration is likely to be less of a hotly debated topic in a
few years. But international companies already know that finding specialists
is tough enough even when you can look all over the globe for it. Thus a
return of the debate on specialist shortages is already hardwired.

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