Germany in the OECD review

The stagnation of the German economy is the central challenge facing the new federal government. In its latest Economic Survey of Germany 2025, the OECD presents a comprehensive analysis of structural weaknesses and also outlines specific reform measures.

The OECD sees the greatest need for action in remedying the shortage of skilled workers and reducing bureaucratic burdens on businesses. With regard to the shortage of skilled workers, the report proposes, among other things, simplifying immigration for skilled workers, improving education and training policies, and increasing work incentives for women, older workers, and low-income earners. In addition, the OECD calls for the abolition of early retirement incentives and the restriction of mini-jobs to schoolchildren and students in order to fully mobilize the labor force potential.

With regard to reducing bureaucracy, it calls for existing regulations and administrative procedures to be comprehensively revised and, above all, simplified. Increased use of digital technologies in public authorities can also simplify administrative procedures. Overall, the report emphasizes the need for an integrated and holistic reform strategy that combines family, tax, and labor market policy instruments to enable sustainable economic growth.

We were also interested in the following topics:

• Polyworking trend: More than half of 26- to 41-year-olds worldwide have multiple jobs, according to a new survey of 2,500 millennials. With over 54% of respondents pursuing multiple occupations, Germany leads the “polyworking” trend in Europe. The main motives are financial security and the pursuit of personal interests.

• Commuting distances & working from home: Due to the pandemic-related decoupling of home and work locations, commuting distances have increased noticeably since 2020, as a study by the IAB shows. Half of those surveyed could work from home, an option that is particularly popular among academics and parents with longer commutes.

• The indispensable: A new study by Das Progressive Zentrum sheds light on the situation of people in grassroots work. These are people whose professional activities do not require formal qualifications, such as cleaners, food delivery drivers, or supermarket employees, but who are nevertheless indispensable to society, the economy, and politics.

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