The German labour market

work in Germany
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Updated 2021-12-03 07:49

Germany's labour market is very attractive to expat talent. Thanks to one of the lowest unemployment rates in the world and a continuously thriving economy, despite global crises such as the COVID-19 pandemic, Germany is the leading entrepreneurship and career development destination in Europe.  

Professional expats are keen on establishing their career in a country with an ever-growing industrial production, significant exports worldwide, and quality working conditions. Major German cities such as Berlin, Munich, and Frankfurt gather most economic activities, including a large part of the industry and services.

Job opportunities in Germany

According to the Federal Government, in 2019, the unemployment rate in Germany was just 0.1 points above 3%, making Germany the country with the third-lowest unemployment rate globally. At the same time, youth unemployment in Germany is also very low (5.8%), whereas that's not the case for other EU member states. Germany's success is primarily thanks to an efficient higher education system, which is not merely theoretical and is continuously modernised to meet the needs of the contemporary labour market.

Best job opportunities are in the IT sector, manufacturing industry, healthcare (especially nursing), engineering, science (especially pharmaceuticals), and commerce. However, regardless of the field, a certain level of knowledge of the German language is usually required to take up employment in the country. That may not be the case if the job is in a multinational company or if it is an unskilled job. Working holiday visa holders and student visa holders stand good chances in finding seasonal jobs in the tourism sector or agricultural activities such as fruit-picking and grape-harvesting.

Good to know:

Most job opportunities arise in Southern Germany, in Baden Württemberg and Bavaria, namely Stuttgart and Munich. Also, Frankfurt and the Rhine-Ruhr metropolitan area offer significant job opportunities.

Joining the German labour market

If you wish to enter the German labour market, you could start your job search from Expat.com's Jobs in Germany platform. Once you find an advert that excites you, you can prepare your application documents and send them either via email to the HR team or via the company's website. Usually, the details about the application's submission are at the end of the job advert.

Three documents are mandatory for most job applications — the CV, cover letter, and professional references. Whereas the German cover letter is similar to cover letters across the world, the German CV may differ — namely, a photograph is expected on the CV. If you have relevant certificates (e.g., vocational training, university diplomas, etc.), don't hesitate to include them in your application. However, it would be best if you translated them to German or, at least, to English.

After submitting your application, you should wait for your invitation to an interview, which is your chance to impress the recruitment team. Among the typical interview questions, expect to be asked about your salary expectations. Also, even though the interview may be conducted in English, be prepared to do some small talk in German, as recruiters may want to test your level of German language skills. Lastly, recruiters may ask you why you want to work in Germany and what you expect from your expat life in Germany.

Good to know:

Some companies conduct group interviews, meaning that several candidates participate in group workshops and presentations or do role plays. These kinds of interviews are especially common for managerial positions, when recruiters try to assess the candidates' problem-solving skills, teamwork, and stress management skills.

Attention:

When applying for a job, communicate to the recruiters the country you apply from and what type of work visa or residence permit you will need to work in Germany. Clarity will allow recruiters to help you with migration procedures and save you time if they aren't after international talent.

Unemployment benefits

In spite of Germany's low unemployment rate, it is still likely that finding a job in Germany may take a while. Hence, if you are looking for a job or your current contract is about to terminate in three months or less, you should register with the local employment agency (Arbeitsagentur). The registration should be in person and only for residents in Germany. Expats in Germany who have been contributing towards an unemployment insurance scheme in an EU-EEA country can transfer their entitlements to Germany.

Attention:

To be entitled to unemployment benefits, you must have contributed towards social security during your previous employment before you became unemployed.

Useful links:

Find your local employment agency

How to transfer unemployment benefits to Germany

Working conditions in Germany

In principle, working conditions in Germany are good. By law, the weekly working hours are 48 hours maximum. However, collective labour agreements in German companies may reduce the working time between 35 to 40 hours per week. In fact, most full-time positions are based on 40 hours per week. Also, German employees benefit from a minimum of 24 holidays per year — bank holidays and weekends excluded. Yet, the German average for holidays is about double the minimum number of days.

Before undertaking employment in Germany, you should receive a written employment contract from your employer. The contract must state, among other things, the salary, paid leave, and working hours. Other information to look for includes:

  • the start and end dates,
  • probation period (if any),
  • location of placement (or remote work),
  • notice period,
  • and the job description.

The HR department of every company should make sure to clarify any unclear information and answer any questions you may have regarding your employment conditions.

Attention:

The salary stated on your contract is the gross salary before the deduction of taxes and social security contributions (e.g., healthcare coverage, pension, and unemployment benefits). An additional deduction is the solidarity surcharge (Solidaritätszuschlag), which was introduced in 1991 to cover the costs of German reunification.

Good to know:

Most companies are highly hierarchical in their structure with strongly defined roles and decision processes. Hence, the notice period, even for non-managerial positions, may range between three to six months, delaying recruitment processes.

Wages in Germany

There is no minimum wage in Germany — each company sets its own salary scales according to collective labour agreements and based on ability, skills, and experiences (Tariflohn). Generally speaking, salaries are higher in West Germany than in the eastern regions. According to the Federal Statistical Office, in the second quarter of 2021, Germany's average monthly gross earnings are € 4,094, excluding bonuses. Among the highest-paid sectors are the financial sector, information and communication, science, and education sectors. On the other hand, the lowest-paid sectors are transportation, construction, accommodation and food, and administration.

Unfortunately, the gender pay gap between men and women remains significantly higher (18%) than the European Union average (15%). However, when the pay gap is researched among men and women employed in the same positions and for the same working hours, the gap reduces to a one-digit number. Nevertheless, Germany is continuously working towards creating a fair and transparent labour market, which is why it introduced some critical labour market policies. For example, with about 76.6 per cent of women in the labour market, Germany is among the top EU countries regarding equal labour market participation. But, of course, there's still a long way to go until women stop being underrepresented in higher management jobs.

You may hear people in Germany talking about Collective Bargaining Agreements (CBA). These are salary and employment conditions' agreements between trade unions and employers' organisations of the same industry. Individual companies are also free to implement their internal employment practices and rules (known as company agreements), as long as they are approved by the workers' council — the body representing the employee's interests. In other words, there is no regulation at the national level covering the whole of the economy in Germany, and the main union confederation, the DGB, does not generally have the mandate to negotiate.

Good to know:

Overtime is not entirely regulated by the country, but by the company's board members and managing directors.

We do our best to provide accurate and up to date information. However, if you have noticed any inaccuracies in this article, please let us know in the comments section below.