Germany Faces 4.3 Mln Worker Shortage as Population Ages

Germany is expected to face a significantly larger labor shortage than previously forecast, with a gap of around 4.3 million workers projected by 2036 due to an aging population, according to a new study by the German Economic Institute (IW).

The employer-backed think tank had estimated the shortfall at about 3 million workers two years ago, but revised population data has led to a sharper outlook.

According to the study, only 9.8 million people are expected to enter working age by 2036, while the country's workforce will continue to shrink as more people retire.

Germany's population is projected to fall to 81.1 million by 2045, down 2.9% from current levels. The potential labor force is expected to decline from 55 million in 2025 to 51.2 million in 2036, before falling further to 50.4 million by 2045.

The findings highlight growing concerns over labor shortages and the long-term economic impact of demographic change in Europe's largest economy.