Asked about the long-term strategies to improve Germany’s productivity Theo Waigel, former German Finance Minister and Speaker at the World Knowledge Forum in Seoul. We both represented the German fraction as we were both invited as speakers of the event. Dr. Waigel answered:
We do have problems in demographics in Germany with less and less young people having to pay into the social system to cater for older generations. There are three possible solutions to counter such productivity issue:
1. We need to work longer in our lives. I am afraid we will have to extend labour time from 65 to 67 or beyond and maybe we need to work even longer in order to provide security in the social system.
2. We need to incentivise more female employment.
3. Refugees could help to solve the employment issue, however we do not know whether the current refugee crisis already helps us right now, especially with the volume of refugees coming into our country and our lack of knowledge about the education standards of these people.
The long term implications of these three action items should help sustain the excellent outlook for Germany’s Productivity.