A good job in the last two years

The Federal Labour Minister presents the mid-term review and labour market report.

Two years to the day after taking office, the Federal Minister of Labour and Social Affairs, Ursula von der Leyen, came to a favourable verdict on the first half of the legislature:

“Germany has a strong economy and its social welfare systems provide reliable protection for people in need. Demography and globalisation are facts that we must deal with, both in labour-market and pension policy. We can make this a change for the better. Education, further training and occupational health afford opportunities for participation in the world of work. Fair working conditions and pay, which are also an international commitment of ours, are essential. Pension policy must not only ensure equitable burden sharing between young and old in a long-life society, but also strike a fair balance between those who support our pension system through full-time work and those who make an equally important contribution by bringing up children and providing care.”

As priority issues for the second half of the legislature, Ursula von der Leyen singled out securing the supply of skilled labour, remedying shortcomings in old-age pension schemes and new strategies to alleviate workplace stress.

One of the greatest medium-term and long-term challenges is securing the supply of skilled labour. Experts estimate that the labour force in Germany will decline by more than six million people in the next 15 years. We need to take decisive countermeasures here. The effort is also worth making for the sake of our general prosperity. If we can bring altogether 1.2 million more people into gainful employment from 2014 to 2025, that is, 100,000 a year, this will generate an additional value added of almost EUR 450 billion by 2025, according to a new forecast by the Centre for European Economic Research (ZEW).

The new labour market report issued by the Federal Ministry of Labour and Social Affairs provides reliable data as a guide for everyone engaged in politics, scientific research and business and industry who are actively seeking answers to these challenges.

In the pension system, which is well-balanced and stable thanks to far-sighted reforms, remaining shortcomings will be addressed in pension dialogue. Plans include greater security for people who have made conscientious provision for old age, worked hard for many years, brought up children and cared for others. Also under discussion is the improvement of reduced earnings capacity pension, a personal accident annuity for more flexible work schemes at the end of the employment phase and enhanced transparency and investor protection in the Riester pension scheme. The final round of the pension dialogue is to take place in December. Draft legislation will be submitted at the beginning of the year.

Occupational health and safety: Mental illnesses are on the rise. Changed family relations, accelerated work operations, tight schedules in everyday life - all this places strains on working and private life. That is why an increasing number of people enter retirement earlier or report sick. 37.7 per cent of those drawing a pension on account of reduced earning capacity in 2009 suffered from this (without addiction problems and forms of psychosis). They were 47 years old on average. In the last 14 years alone, the number of working days lost due to mental disorders has risen by 83 per cent. Treatment costs are estimated at about EUR 27 billion a year. Studies indicate that about 70 per cent of companies do not properly apply the Safety and Health at Work Act when it comes to mental stress (due to ignorance). In the Joint German Health and Safety Initiative (GDA), which is jointly supported by the Federal Government, accident insurance funds and the social partners, the Federal Ministry of Labour frames strategies for improving the protection of employees against mental stress in particular. In 2012, the Federal Government (Federal Labour Ministry) will head the initiative.

A booklet on the mid-term review provides a compact summary of the main projects:

• In force since January 2011, the job centre reform has retained the successful cooperation between the Federal Employment Agency and the municipalities and placed it on a sound constitutional footing with the amendment of the Basic Law.
• The judgement of the Federal Constitutional Court of February 2010 on improving the participation children and youth in education has been implemented. The education package for children marked a paradigm shift. 
• At the same time, a transparent and accountable reassessment has been made of the standard Hartz IV rates in keeping with the new legislation.
• Progress has been made in efforts to prevent the abuse of temporary workers. The ‘revolving door’ provision prohibits employees from being dismissed and then re-recruited straight afterwards as temporary workers with inferior working conditions in their former enterprise or another company in the same group. The minimum wage in temporary work is scheduled to be made generally binding before the end of the year.
• The reform of active labour-market policy has introduced major structural adjustments. In response to the current keen demand for labour, the aim is to place jobseekers faster and more efficiently and give placement agencies more leeway to assist them. A future priority is more basic and further training and less publicly sponsored artificial employment. The very favourable development among the long-term unemployed as well shows that we are on the right track. 
• In six industries, existing minimum wages in effect since November 2009 have been prolonged. New minimum wages have been allowed for the care sector, the surveillance and security industry and for temporary work. Obligatory minimum wage limits will therefore be in place at the beginning of 2012 in ten industries to protect four million employees from dumping wages.
• The Federal Government’s National Action Plan for the Implementation of the UN Convention on the Rights of Persons with Disabilities has been adopted in Germany. With over 200 measures and a EUR 100 million programme for improving the integration of persons with disabilities in work, the action plan contributes to more participation. Our goal is to foster an inclusive society.
• The report, Better working life for older people, has been published. It describes the current deficits and future opportunities in promoting the labour-force participation of older people. In our long-life society, gradually raising the retirement age to 67 by 2029 will spread the burden of providing for old age equally over all generations.
• The Federal Labour Ministry led the way for the Federal Government’s strategy to secure the supply of skilled labour. The immigration of qualified skilled personnel from abroad is a major additional component for developing our national potential. On the initiative of the Labour Ministry, the priority review for physicians and electrical and mechanical engineers has been suspended.