German companies are struggling to hold onto skilled workers, according to a new IZA Research Report commissioned by the Federal Ministry of Labor and Social Affairs. The researchers analyzed data from the Linked Personnel Panel (LPP), a nationwide survey of businesses and employees over an eight-year period. The evaluation of the survey data collected every two years from 2012 to 2020 underlines the growing challenge of securing skilled workers, but also shows opportunities and key areas for corporate human resources to address this challenge.
The findings reveal a concerning trend: the number of applicants per open position is dropping, it takes longer to fill vacancies, and employee turnover intentions are rising. While companies acknowledge the importance of a positive work environment and competitive pay in retaining staff, the study identified a troubling gap between this awareness and actual implementation.
Despite recognizing the benefits of a good company culture, many businesses haven’t translated this knowledge into actionable practices. Employees report a decline in overall work atmosphere, suggesting companies are failing to address their concerns. The report highlights the need for companies to bridge this “knowing-doing gap” by actively implementing strategies that promote employee satisfaction and loyalty.