Skilled Immigration Policy in Germany – A Conservative Model

March 05, 2020
About the author: Dr. Wang Hui, Fellow of the Taihe Institute, expert of labour and immigration issue. 

Introduction: Since the end of World War II, Germany has undergone a fundamental transformation from an emigration country to an immigration country. In 1987, the percentage of foreigners over the total population in Germany reached 7%, and since then has risen gradually. Germany “has in fact become a non-typical immigrant country” [1]. In 2018, it was recorded by the German Federal Statistical Office that the population with migration background had reached 20.8 million [2], accounting for about 25.5% of the total population. Germany has become the world’s second most popular destination for immigrants after the United States, but German society and its successive governments have always denied the fact that Germany is an immigration country. Refusing to recognise the immigration facts and lacking of an immigration policy render it impossible for the German government to handle the complicated migration issues. The immigrant groups are further marginalized, and the process of social integration is extremely slow and problematic. Eventually in 2005, the first Immigration Law was introduced by the German government (hereinafter referred to as “2005 Immigration Law”), which officially confirmed that Germany is a modern immigration country. Since then, the German government has amended the law for several times. The Skilled Immigration Act (hereinafter referred to as “SIA”), which is just implemented in March 2020, are mainly revisions of the Residence Act (AufenthG), which is Chapter I of the Immigration Law. This is yet Germany’s another attempt to attract professionals from the non-EU countries. This paper briefly introduces and evaluates the 2005 Immigration Law, the main revisions since the enactment thereof until present day, as well as the background, purpose and potential impact of the implementation of the SIA in 2020.

(Credit: The European Times)
I. First Immigration Law in 2005: Far Less Effective Than Expected
Germany’s birth rate has continued to decline since the early 1970s, causing a negative population growth. However, the country has maintained a steady population growth, suggesting that the growing immigration has been able to compensate the negative population growth caused by a low birth rate. Apart from the problem of a shrinking population, Germany is also facing problems of an aging society and a severe shortage of professionals in the labour market. In an effort to enhance its international competitiveness and maintain its economic growth, Germany has gradually relaxed its immigration restrictions. Before the new immigration law was formulated, the then German chancellor Gerhard Schroeder attempted to introduce a Green Card Program, which aims at attracting highly skilled professionals from IT industry to settle in Germany. Unfortunately, the new program was short-lived due to various reasons.
Finally, the 2005 Immigration Law was formally implemented in 2005. Before that, the provisions on the residence and employment of foreigners were codified in a number of different laws and regulations, such as the Alien Residence Act and Employment Regulations. The 2005 Immigration Law is called Law on the Control and Restriction of Migrants and the Regulation on the Residence and Integration of EU Citizens and Foreigners (Gesetz zur Steuerung und Begrenzung der Zuwanderung und zur Regelung des Aufenthalts und der Integration von Unionsbürgern und Ausländern). The lengthy title of the law shows the fear and suspicion of the government towards immigrants. The Residence Act, Chapter I of the Immigration Law, replaced the previous Alien Residence Act.
The real impact of the new immigration law on attracting the skilled labour was under heavy criticism. In practice, the new law did not adopt the point system recommended by the independent commission. Instead, it employed a more conservative model of the immigration policy, which commonly promotes a guarantee of work contract, a labour market testing system and a quota system. There are also additional requirements such as a very high salary threshold for the immigrants to achieve. As a result, it has only managed to attract fewer than 1,000 skilled employees during the first year after the immigration law was introduced. This was even less than the number of information-technology professionals that the green card program has attracted.
However, the 2005 Immigration Law simplified the previous four types of residence permit into two, namely the “residence permit” and the “permanent residence permit” which cleared the confusion among the previous four residence permits codified by the Alien Residence Act [4].
II. Major Amendments to the Immigration Law: Integrating the EU Blue Card System into the National Immigration System.
The 2005 Immigration Law has been amended several times since its introduction. The most influential amendment was the incorporation of the EU blue card into the national immigration system in 2012, and the change of policies towards the international students graduating from the German higher education institutions: the students can now apply for an up to 18-month job-seeking residence permit after graduation, which was only 12 months before.
In 2012, in response to the EU’s Blue Card policy, the German Federal Ministry of the Interior revised the “Guidelines for the Introduction of Highly Skilled Talents” in order to attract both highly skilled and highly educated immigrants that include international students, international graduates, foreigners who have received formal vocational training, start-ups and self-employed business legal representatives. The Government has also amended Paragraph a, Article 19, “Long-term Residence of Advanced Talents” of the Residence Act, Chapter I of the Immigration Law. This was the response to the EU policy on Blue Card incorporation, which was Germany’s earliest effort to lay out the basic conditions for the issuing of blue cards to highly skilled immigrants from the third countries [5].
After the refugee crisis in 2015, “orderly migration” has become a pressing issue among German politics and civil society. In 2018, the population aged 65 and above accounted for 21.46% of the total population, and the population aged 14 and below for only 13.62%. The problem of the declining population of young people coupled with an aging population is becoming increasingly prominent, and the urgent demand for migrant labour and skilled labour is emerging. The German labour force is expected to fall by 6 million by 2030. The shortage of working population combined with the refugee issues urged yet another update of the immigration law to be discussed. In March 2020, another change of the immigration law is implemented.
(Credit:  World Bank staff estimates based on age distributions of United Nations Population Division's World Population Prospects.)
III. 2020 SIA: Defining “Skilled Labour” and Abolishing Labour Market Test System
The main content of Germany’s SIA (Fachkräftezuwanderungsgesetz)which came into force in March 2020, is found as revisions of the Residence Act, Chapter I of the Immigration Law. Changes have been made to the conditions for issuing different types of residence permits, for example, residence permits for employment, job-seeking, vocational training, vocational training program seeking, as well as requirements for certifying professional qualifications. The move is to attract skilled migrants from non-EU countries planned by the German government.
Germany is the most generous Blue Card issuer in the EU which issues more than 80% of the total Blue Card in the EU every year. In 2018 alone, it has issued more than 27,000 new cards. However, the Federal Agency for Work (Bundesagentur für Arbeit) points out that Germany still has a gap of 1.2 million skilled professionals, especially in the fields of information technology, mathematics, natural science, engineering and health services, as well as technical personnel. Although skilled migrants from EU countries still account for the majority of the skilled immigration, the population of EU migrants is shrinking year by year. According to the Bertelsmann Foundation, between 2018 and 2060, Germany will need to recruit at least 150,000 skilled migrants each year from non-EU countries to offset the negative impact of Germany’s shrinking workforce. However, the reality shows that only 7% of the non-EU immigrants in 2017 were skilled, which accounted for less than 0.1% of Germany’s total labour supply. The top five countries of origin for skilled immigrants from non-EU countries were India, Bosnia and Herzegovina, the United States, Serbia and China [6]. Therefore, it is inevitable that Germany needs to attract skilled professionals from non-EU countries. The introduction of the SIA which is formulated in particular to attract talents from non-EU countries, aims to meet the long-term demand of Germany’s economic development and demographic change.
Foremostly, the SIA redefined the “skilled Professionals” – it includes not only those who completed university education, but also those who has received formal vocational and technical training. This suggests that Germany attempts to tackle the problem of severe shortage of technical personnel via the new immigration policy; after all, the number of skilled immigrants with recognised occupational training from EU countries has been declining since the financial crisis.
Those skilled professionals without the university education are now granted with more rights which was solely enjoyed by those with the university degree before. For example, after providing certificate of certain German language proficiency level (ranging from intermediate to advanced level) and sufficient financial means to cover the cost of living during a job seeking period in Germany, professionals with vocational training qualification can also apply for a six-month “job-seeking visa” to search for employment in Germany. However, this approach is unlikely to have significant effect, given that only just over 200 people with a bachelor’s degree in Germany applied for such a “job seeking visa” in 2019.
Another notable change that the SIA made is the abolishment of the labour market testing system, which proves to be one of the biggest obstacles for the non-EU skilled professionals to work in Germany. This measure is particularly beneficial for small and medium-sized businesses in Germany, most of whom are reluctant to hire an employee requiring time and resources spent on testing through a complex procedure. However, the law leaves room for the government to reinitiate the labour market testing system if the local labour market demands.
There are also some other points worth noting. For professionals who do not fulfil the EU Blue Card conditions, in order to be granted with working visas, applications will need to go through a review process required by the Federal Agency for Work, which involves verifying that the labour contracts meet the industry standards, and the applicants’ professional qualifications are recognized and in line with the job requirements. Furthermore, owing to its mistrust of different vocational training systems employed in other countries, Germany has been heavily criticized for its cumbersome examination and lengthy certification process of the professional qualification. In addition, the high German language proficiency requirement may influence some potential skilled professionals to choose English-speaking countries over Germany. Moreover, the new immigration made no substantial changes regarding the skilled immigrants with university degree but only on minor areas such as broadening their field of employment.
(Credit:Agence France-Presse )
In conclusion, with respect to the SIA, although the redefinition of skilled professionals has expanded the pool of talent that Germany intends to attract, it still leaves room for the labour market testing system to be reactivated, as well as retaining the complex procedures of certifying the professional qualifications. Therefore, it remains to be seen whether the new law can attract sufficient amout of intended immigrants to Germany, especially the foreign technical workers from non-EU countries.
In February 2020, Britain announced a new point-based immigration policy [7], which was the government’s first attempt to revise the immigration system after Brexit. The new policy intends to attract highly skilled immigrants through a more liberal point system. Although the German government has continuously amended its immigration law, the immigration policy has been conservative since the inception of the immigration law 15 years ago. Germany still has not considered to introduce a point system in its immigration policy. It is fair to conclude that the German immigration policy is still conservative, and the impact of the SIA remains to be seen.
[1]Klaus Bade. Multicultural Challenge: People Across National Boundaries-Across Human Boundaries. (Munich: Beck Press). Here refers to that German immigration policy is not open, but the proportion of the immigrant population is high enough for it to be considered an immigrant country.
[2]Popularization of Migration, Statitisches Bundesamt,
Germany’s Federal Bureau of Statistics provides that if an individual and his or her parents do not acquire German nationality at birth, they are defined as having an immigrant background, which is a different definition from that of the United Nations.
[3]The Labor Market Test provides that in cases where migrants from non-EU countries receive employment offers or contracts from German companies, it must be checked whether there are German or EU applicants in the German labor market qualified for this position. If not, the position is one that has passed the labor market test. This ensures that the introduction of migrants from non-EU countries does not create unemployment for their own people.
[4]The confusing problem refers to the establishment of four different forms of residence under the Alien Residents Law prior to the implementation of the 2005 German Immigration Law, namely, residence approval, residence authorization, residence permit and residence rights. Of these, residence authorization has long been obsolete and has been abandoned. Residency approval and residence permit are issued to different types of immigrants, where residence permit cannot be used to apply for settlement and must be converted to other forms of residence before they are entitled to do so. In 2005, the Immigration Act reduced the four forms of residence to two, namely, a residence permit and a settlement permit. Of these, a residence permit with a limited period is called a residence permit, but the passport indicates whether this type of residence permit can be converted into a settlement permit if certain requirements are met .
[5]The minimum conditions for application for a Blue Card in Germany for the first time are:
1. University diploma (German university degree, or degree equivalent to that of a German university).
2. Wage contracts and minimum wage requirements are required to be €44.800 a year, or €34.944 a year for industries in short supply (e.g. IT professionals, engineers, natural scientists, etc.). Blue Card holders may obtain a long-term residence permit after three years and a long-term residence permit after two years if they can prove that they have a German level of B1 (Paragraph a, Article 19 of the Residents Act).
[6]Skilled migrants from China are mainly highly qualified individuals, most of whom hold a work residence permit, a Blue Card or a researcher residence permit.
[7]The U.K. Home Office issued a new immigration policy after “Brexit” on February 19. From January 1, 2021, the U.K. will adopt a points-based immigration system to control the scale of immigration. The new scheme will rate applicants in terms of labor skills, qualifications, pay levels, language skills, job opportunities and so on. Applicants will be allowed to work in the U.K. only if they receive sufficient points.

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