Ursula von der Leyen, Germany’s minister for labour and social affairs, has a problem that most of her European colleagues can only dream of. It is not unemployment. It is a growing shortage of workers in Europe’s largest economy – especially skilled labour.
“The population of working age between 15 and 65 [in Germany] is shrinking,” she says. “If you look at the next 15 years, if we do not change our ways of working – which is the solution – then we will have 6 million potential workers less in the labour market, which is approximately the working population of Bavaria.”
Yet in the rest of the euro zone, the biggest social challenge in countries such as Italy, France and Spain comes from joblessness, especially youth unemployment, with the numbers out of work reaching record totals as recession and austerity hit the labour market. In both Spain and Greece, the number of young people without jobs is more than one in two.
For Ms. von der Leyen, the second most powerful woman in the German government after the chancellor, Angela Merkel, solving that dilemma will require fundamental reforms in the heart of the euro zone, and its periphery.
In Germany she believes it requires promoting more women to fill skilled jobs, persuading older people to stay longer in work, training young workers with better skills, and attracting more skilled migrant workers. In the rest of Europe, she wants to export Germany’s system of a public-private partnership in vocational training, and encourage more labour mobility for young workers to train in Germany.
“Whether it is painful or not, because we have a globalized world, we have to undertake reforms to improve our competitiveness,” she tells the Financial Times during an interview in her home town of Hanover. “That is the story Germany had to learn 10 years ago. That is the story Germany has to learn today as far as women are concerned.
“We have to change. No country in Europe can say we do not need to change. For some it is more painful than for others. But I would never say Germany can just lean back. We cannot.”
Ms. von der Leyen is in the uncomfortable position of being the most outspoken proponent of social reform in a conservative coalition government, on the left of the Christian Democratic Union headed by Ms. Merkel. But in an election year, when the government is under attack by the opposition Social Democratic party for paying too little attention to social justice, she is likely to be a key player in Ms. Merkel’s plan to seize the centre ground of German politics.
The issue on which she becomes most passionate is the need to reconcile work and family for both mothers and fathers in Germany.
“If you look at the proportion of time (German) women work, you see that 45 per cent work part-time,” she says. “Part-time in Germany means on average 18.6 hours per week, which is the lowest in Europe.”
A big part of the problem is that Germany has a long tradition of “part-time schooling,” she says, as well as “part-time kindergartens, and zero day nurseries for children younger than three. It is a long tradition of having an attitude that Mum stays at home with her children.”
For Ms. von der Leyen, the words are spoken with feeling. Aged 54, and a medical doctor by training, she is the mother of seven children, in a country where the average fertility rate is 1.4, and the population is in decline. “There is a lot of personal experience behind my political beliefs,” she says.
“I am talking this way because I lived in the US for four years. Coming back, I realized how outdated the [child-care] system was in Germany. … I had a five-year-old and two three-year-old twins, and I was pregnant with the next one. It was a disaster.”
As family minister in Ms. Merkel’s first coalition government, Ms. von der Leyen was responsible for introducing parental payments for fathers as well as mothers, and for negotiating (with the German federal states and local councils) a new system to guarantee every child from the age of one the right to childcare. That is supposed to come into effect from August 1, 2013.
“Of course (German women) want to have children,” she says. “The wish to have children is as high as in other countries. But they anticipate that it is going to be very tough if you are well educated to have children and to work.”
She now plans to introduce legislation requiring employers to agree a “right of return” with mothers if they want to spend longer than a year on maternity leave.
“All these things like having the right to childcare, establishing all-day schools, introducing the right to return to full-time work, these are milestones, all these things change attitudes,” she says. “I have seen it with the parental payment. It changed the attitude of young fathers. It taught them they are irreplaceable. If you want to reconcile work and family, it is the responsibility of both the father and the mother.”
As far as the rest of Europe is concerned, Ms. von der Leyen is convinced that countries with high youth unemployment should introduce a dual vocational training system like that in Germany.
“It is the classic public-private partnership,” she says. “You have the private sector that offers the training jobs in the enterprise, hands on. The public investment provides the theoretical training. So you train the young generation very close to what the market needs.”
She hopes that a significant proportion of the €6-billion allocated by EU leaders to tackle youth unemployment can be spent on building up dual vocational training schemes across the continent.
“We are co-operating with Italy, Spain and Portugal to offer as much help as possible to build up these structures,” Ms. von der Leyen says. “Secondly, we offer vocational training in Germany for young people from other European countries.
“We have vacant jobs for vocational training. Employers desperately want to find young people as trainees. And on the other side, there are young Spanish people, and young Italian people, who are desperately looking for jobs. So let us match that.”