The NYT told readers that:
“While a jobless rate in single digits would be cause for celebration in many countries, in Germany it is the sign of a critical lack of workers.”
Actually, for the vast majority of people in Germany a low unemployment rate is cause for celebration because most of them work for a living. A low unemployment rate both means that they are likely to be able to find work and that they will be in a position to get pay increases through time.
This 2-page article actually presents zero evidence for its claim that Germany is faced with a “critical lack of workers.” It reports that:
“employers in many sectors of the German economy are facing labour shortages, under the dual pressures of an ageing population and inflation-fighting measures that have kept wages low in comparison with its neighbours.”
This is evidence of not very competent employers. If they need workers and can’t get them, then the answer is to raise wages. People who run businesses should understand this logic. (It’s not clear why “inflation-fighting measures” would keep a business from paying its workers the market wage.)
Some businesses will not be able to pass on higher wages in higher prices. This will squeeze profit margins and might force them out of business. This is the way a market economy works. Workers move from low productivity sectors to high productivity sectors. It is not clear why anyone would think of this as a crisis, although the employers who go out of business are probably not happy.
The article also goes on to complain about worker shortages due to low birth rates and limited immigration. If there are fewer workers this just means that the least productive jobs go unfilled. There will be fewer people working as store clerks in convenience stores, housekeepers in hotels, or as parking lot attendants. There is no obvious economic problem associated with workers moving into more productive occupations.
NOW WATCH: Briefing videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.