Germany is considering the immigration of skilled labor as a means of increasing MPL and consequently, making its industries more productive. The German Minister of Education and Research believes that selective immigration is a possible remedy to the problem of severe shortage of skilled workers faced by her country’s expanding economy.
Germany currently has 80,000 migrant workers who have established businesses, with a total of about 350,000 employees. The number of business owners is predicted to reach 130,000, providing jobs for about 750,000 people by 2020.
According to the Cologne Institute for Economic Research, if Germany relaxes its skilled worker immigration laws, its GDP will increase by up to 100 billion euros in 10 years.
The demand for immigrate skilled worker do improve the GDP, but on the other hand, this method will increase the unemployment rate of German citizens. So, I think Germany government should not use this method for the long run. What they should do is increase the training of unskilled workers, thus the structual unemployment rate will fall down.
ReplyDeleteSorry, I made a mistake. The last sentence in my comment should be : the frictional unemployment rate will fall down.
ReplyDeleteI agree with Yan but I also believe the German government is doing this because of the age distribution of the Germans. Most of the Germans are now very old leaving their MPL to be low. However, what the German government is doing might not benefit them in the long run.
ReplyDeleteI also thought that bringing in immigrant workers will increase frictional unemployment rate and that the government should resort to the training of its own labor force. However, the article emphasizes the fact that even if full employment is reached, Germany will still need more skilled workers to meet the demand of its fast growing economy.
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