Demographic Change Impacts Employment Prospects in Thuringia
A recent study by the Nuremberg Institute for Labor Market and Berufsforschung (IAB) predicts that Thuringia will experience the most significant consequences of demographic change compared to other German states. The study projects a 15.8% drop in the state’s working-age population by 2040.
This decline will result in a smaller workforce and fewer job opportunities. According to the IAB study, labor shortages will dampen growth prospects in several regions. Only Hamburg and Berlin are expected to see an increase in working-age population by 2024.
Eastern Germany Faces Challenges
The study highlights particular challenges for the five eastern German states, including Thuringia, where the decline in working-age population is expected to be most pronounced. The creation of new jobs will be outpaced by job losses due to structural changes and the shrinking labor force.
Nationally, the study anticipates a reduction in the number of employed persons from 47.1 million in 2023 to 46 million in 2040.
Sectoral Impacts
The study reveals that different economic sectors will experience varying impacts. In Thuringia, the currently strong construction sector, public administration, and retail are expected to face job cuts due to the declining population. Education and training, as well as the food industry, will also be affected. In contrast, healthcare and social work are projected to create new jobs as the population ages.
Addressing the Challenges
IAB expert Enzo Weber emphasizes the need to address the challenges in shrinking regions to maintain economic vitality. Otherwise, a downward spiral could occur, with reduced public infrastructure leading to further population decline.
Weber suggests exploring untapped potential among older individuals and women who could extend their working hours or increase their workforce participation. Technological solutions, such as virtual work, could also mitigate the impact. However, he acknowledges that immigration will be crucial in meeting labor market needs.
Key Findings
- Thuringia will experience the most significant decline in working-age population among German states, at 15.8% by 2040.
- The shortage of potential workers will hinder growth prospects in many regions.
- Eastern German states face particular challenges due to the combination of population decline and structural change.
- The number of employed persons in Germany is projected to decrease from 47.1 million to 46 million by 2040.
- Sectors such as construction, retail, education, and the food industry will face job losses in Thuringia, while healthcare and social work are expected to create jobs.
- Addressing the challenges requires targeted interventions in shrinking regions, promoting the employment of older and female workers, exploring technological solutions, and embracing immigration.
