Germany falls behind in international competition for top talent

The new edition of the OECD Indicators of Talent Attractiveness study analyzes the conditions that are attractive to qualified migrants in all 38 OECD countries. These relate to seven dimensions: Quality of career opportunities, income and taxes, future prospects, opportunities for family members, the skills environment, and diversity and quality of life. Possible hurdles in obtaining visas are also taken into account. At the same time, the study highlights more recent developments by comparing it with the previous study from 2019.

"Germany needs skilled workers, also from abroad, to secure its prosperity. The international comparison clearly shows what Germany needs to do to better manage the skilled labor emigration that is so important for our country," says Ralph Heck, Chairman of our Executive Board.

In terms of highly qualified workers from abroad, Germany has fallen in attractiveness over the past three years from 12th place in 2019 to 15th place. The OECD countries New Zealand, Sweden, Switzerland, Australia and Norway are the most attractive. Conditions in Germany have not worsened compared with 2019, but other countries have caught up strongly. Germany should improve the opportunities for foreign academics to fill highly qualified jobs in line with their skills profiles, the hesitant naturalization practice and the slow pace of digitization.

Sweden, Switzerland, Canada, Norway and New Zealand are the top countries for foreign entrepreneurs. Germany is falling behind in the international competition and is now only in 13th place, down from 6th place in 2019. Here, too, the sluggish pace of digitization plays a role – in addition, unlike better-placed countries, Germany continues to require minimum capital and social acceptance of migrants is less pronounced.

The general conditions for startup founders were examined for the first time in 2023. The most attractive countries are Canada, the USA, France, Great Britain and Ireland. Germany lags behind and is only ranked 12th in this category. The reasons: fewer professional opportunities, comparatively few female inventors and a lack of tailored visas to attract top entrepreneurial talent to a thoroughly attractive startup ecosystem.

In general, Germany does not score well in the digitization of visa procedures, which reduces its attractiveness. It also receives a points deduction for rejected visa applications from highly qualified professionals.

Germany, on the other hand, is particularly attractive for international students. Here, the Federal Republic is ranked second behind the United States, ahead of the United Kingdom, Norway and Australia in the international competition for talent. In 2019, Germany ranked third in this category. The Federal Republic can score points with excellent universities, lower costs for studying and good opportunities to work and stay during and after studying.

"Germany is now an open and attractive country for skilled immigration," says our migration expert Ulrich Kober. "But there is a need for action when it comes to visa and admission policy, digitization, naturalization or dealing with diversity, as shown by the comparatively low influx of skilled workers from third countries and the reluctance of companies to recruit abroad."