Saxony-Anhalt is losing its workforce, whilst companies are already struggling to recruit staff. Economist Prof. Andreas Knabe explains why skilled immigration is becoming a key factor in the state’s competitiveness, why international students represent particular potential, and why a welcoming culture alone is not enough.
Professor Knabe, how serious is the demographic situation for Saxony-Anhalt’s economy?
Saxony-Anhalt faces a particular challenge: in the coming years, significantly more people will be retiring than young people entering the labour market. According to the latest population forecast, the number of people of working age could fall by around 272,000 by 2040. That is equivalent to about one-fifth of today’s labour force.
Even if we make better use of the existing domestic labour force – for example, through higher labour force participation or people working for longer – this is unlikely to fully offset the decline. Immigration can therefore be a key factor in meeting the demand for skilled workers and maintaining economic momentum.
What does this mean in concrete terms today?
This can be seen from the employment figures. Between 2024 and 2025, the number of employees subject to social security contributions who are German nationals in Saxony-Anhalt fell by 10,500. At the same time, around 5,500 foreign workers joined the workforce. Without immigration, the decline in employment would therefore have been more than twice as high.
But immigration is not a panacea. It is particularly helpful when people can be integrated into the labour market and become productive relatively quickly. By contrast, the outcome tends to be less favourable or even negative if integration into the labour market takes a long time or if, in the long term, only low productivity and low incomes are achieved. It is therefore crucial to attract skilled immigrants, integrate them swiftly and retain them in the country in the long term.
Where is the shortage of skilled workers particularly evident?
Primarily in the health and care sectors, in technical and industrial occupations, and in construction and the skilled trades. There are also shortages in the hospitality sector, in parts of the logistics and IT sectors, and in social work and education. The Federal Employment Agency identifies a total of 22 occupational groups facing shortages in Saxony-Anhalt by 2025. The shortage therefore affects not only top academic professions, but ranges from apprenticeship-based roles to highly qualified specialist positions.
What role do universities play in securing a skilled workforce?
Their most visible role is to train qualified graduates. For Saxony-Anhalt, however, it is not just a question of how many people study here, but also of how many subsequently find career prospects within the state.
Added to this are continuing professional development, research, knowledge transfer and spin-offs. Universities help companies to develop new technologies and processes. Research findings can give rise to new companies that create skilled jobs. And through internships, final-year projects or careers fairs, universities bring students and regional employers together at an early stage.
However, universities cannot achieve this on their own. If we want to retain graduates, we need attractive jobs, opportunities for development and an environment in which people and their families are happy to live.
International students are seen as offering particularly great potential. What determines whether they stay?
Above all, it depends on whether they see attractive professional and personal prospects here. A recent DAAD study shows that around two-thirds of international students are likely or certain to stay in Germany after obtaining their degree. Of these, around half can envisage staying in the federal state where they studied. The regional potential is therefore considerable.
Early contact with the labour market is particularly important: subject-related internships, part-time student jobs or final-year projects within companies. This helps build practical experience and professional networks. Part-time jobs outside one’s field of study are significantly less helpful in this regard.
A good command of German also improves prospects, particularly in Saxony-Anhalt with its many small and medium-sized enterprises. And finally, friendships, relationships, social networks, quality of life and the feeling of being welcome all count. International graduates are mobile. They can choose where they live and work.
Why, then, is the transition from university to the regional labour market often difficult?
There is often a lack of subject-specific practical experience, knowledge of application procedures and contacts with employers. Added to this are language barriers. Where qualifications are in high demand, companies may sometimes make concessions, but a good command of German remains important for broad access to the labour market.
Another problem is slow administrative procedures and uncertainties regarding residence status. A recent DAAD study shows that only around a third of international students find that their applications are processed promptly by immigration authorities. Such delays make it harder to enter the workforce and also cause uncertainty among employers. Furthermore, some companies in Saxony-Anhalt still have little experience with international applicants. There is therefore a need for more information, earlier contact and closer support on both sides.
What can a programme such as the University of Magdeburg’s Career Certificate achieve?
In my view, the Career Certificate is a very good initiative because it addresses precisely the crucial interface between university studies and the regional labour market. It provides knowledge about application procedures and professional requirements, combines language support with contacts to businesses, and can thus open up concrete career prospects in Saxony-Anhalt.
Programmes like this should start as early as possible in a student’s degree. Universities can use them to build important bridges. However, international talent will only stay in the long term if they find not just any job, but good opportunities for development and attractive living conditions.
What happens if the political climate unsettles international students and skilled workers?
Then Saxony-Anhalt makes it more difficult to attract precisely the kind of immigration that could help cushion the demographic decline. International students, researchers and skilled workers are often highly mobile. If they do not feel welcome or safe, they will choose not to come to the state or will leave again.
It becomes more difficult for universities to attract students and outstanding researchers. The economy loses potential skilled workers, start-up founders and international contacts. A cosmopolitan political and social climate is therefore not just a question of living together. It is a location factor.
What further significance do universities have for start-ups and business relocation?
Universities bring together new knowledge, innovative ideas and highly qualified people. Added to this are laboratories, scientific consultancy and an environment in which ideas can be tested and business models refined. Spin-offs are often knowledge- and technology-intensive. They create skilled jobs and can help retain research findings and well-educated people within the country.
A university’s international visibility can also be important for attracting businesses to the region. A region becomes more attractive to knowledge-intensive companies if they find high-calibre research, skilled workers and potential collaboration partners there. Universities can thus form part of a regional innovation ecosystem that facilitates start-ups and encourages businesses to set up operations. However, long-term success also requires capital and a political environment that recognises not only the risks but also the opportunities presented by change.
How, ultimately, does a genuine welcoming culture emerge?
A welcoming culture can neither be created by higher education institutions alone nor imposed by policy. It emerges when immigrants and locals are willing to open up to one another, and both recognise the long-term benefits of doing so.
Universities must attract motivated individuals, provide them with qualifications and prepare them for the labour market. Politicians must establish swift, transparent and reliable administrative procedures. Businesses must provide opportunities for practical experience and be prepared to integrate international applicants into their organisations.
At the same time, reservations held by sections of the population should not be ignored. Universities and the business community must clearly demonstrate that the targeted immigration of qualified people also benefits the local population: it alleviates skills shortages, keeps businesses and public services functioning, and helps to secure economic prosperity. Openness is therefore, not least, in the local population’s own interests.
Thank you very much for the interview!
