The Saxon economy has been flourishing for years. Increases in productivity, profitable industry, innovative trades, a growing service sector, consistently expanding modern high-tech sectors and the generally good economic situation reflect the ongoing boom in the Free State of Saxony.

The number of employees paying social security contributions is at a record level, while the demand among domestic companies for well-trained skilled workers is higher than ever before. From 2005 to 2017, the number of employees in the Free State of Saxony increased by more than 18 percent. During the same period, the population decreased by a total of 4.5 per cent, with the number of people of working age actually dropping by 11 per cent. The fact that employment figures rose nonetheless is partly thanks to the high number of unemployed people returning to work.  Since 2005, the unemployment rate has fallen from 18 per cent to an annual average of less than 6 per cent in 2018.

The labour market is changing

We face a great challenge: although birth rates have risen again slightly in recent years, higher life expectancies combined with declining fertility rates going back decades are causing Saxony’s population to shrink and grow older. The regional head office of the Federal Employment Agency estimates that in the year 2030, there will be a good 328,000 workers too few in the state of Saxony for demographic reasons. During that time, the number of people potentially in employment will fall even further than the population as a whole due to the high number of retirements. For Saxony, that means that there will certainly not be any lack of jobs in future, but there may well not be a sufficient number of people available to carry out those jobs. The current challenge thus lies in meeting this need for skilled workers, ensuring that people who are capable of work remain so, and adjusting their skills as necessary to meet the rising demands in terms of qualification levels. In addition to this, global megatrends – such as increasing digitisation, structural change and workers’ changing values – continue to radically alter the basic conditions on the Saxon labour market.

The future starts today

Saxony’s future depends in no small measure on which strategies are developed and implemented today, and what paths the different players involved follow in their joint effort to maintain the supply of skilled workers. That is why it is important to set off in the right direction today, to ensure that Saxony’s employers continue to find qualified workers tomorrow. That challenge cannot be accompanied by the Saxon government alone; neither is it the sole task of employers to maintain a source of skilled workers. All the players on the Saxon labour market need to work together to be best prepared for the coming challenges. That is why it was important to the state government to join forces with their partners, players in business and the social sector, chambers of commerce and industry, municipalities, the regional head office of the Federal Employment Agency and other representatives of civil society to extend the 2012 skilled labour strategy, producing the 2030 skilled labour strategy (Fachkräftestrategie, FKS 2030).


In 2012, the Saxon state government developed the 2020 skilled labour strategy, setting out key action areas and measures to safeguard the supply of skilled workers in the state. Now, this has been further refined to create the “2030 skilled labour strategy for the Free State of Saxony”. While the 2020 skilled labour strategy was still strictly limited to action taken by the state, the focus has now been widened considerably. The 2030 skilled labour strategy takes into account the scope of all central Saxon players responsible for getting skilled workers qualified, attracting them to the region and making them want to stay. Their joint aim is to ensure that even in 2030, every employer in the state of Saxony can still find and keep a sufficient number of well qualified, motivated skilled workers. The 2030 skilled labour strategy sets out the path which everyone could take to improve the situation regarding young people’s qualifications, the recruitment and activation of various target groups and long-term employability.

Keeping Saxony going as an industrial location

Even today, there is already a lack of skilled workers in certain occupations and sectors. This shortage is turning into the greatest economic risk threatening Saxony's growth as a business location. It is important to establish a favourable environment and forward-looking policies on business, the labour market and education, to create the conditions needed to maintain the supply of skilled workers beyond the year 2020, and ensure that Saxony’s industry and commerce stay strong and innovative. This means expanding Saxony’s position as a traditional industrial location and strengthening its profile as one of Europe’s leading regions for industry and high technology. In this respect, there is particular interest in the small and medium-sized companies that shape the Saxon business world. But their growth and ability to innovate depend crucially on qualified skilled workers.

Photo credits: SMWA/David Pinzer,