Skill Shortages in Britain and Germany

British firms attach more weight to “hands on” experience than to formal qualifications. They manage to cope with lower proportions of skilled labour than those required by corresponding German firms, without lowering quality of output, mainly by optimising the allocation of their limited stocks of skill between various tasks. They concentrate on retraining labour which is already skilled, whereas German employers offer more apprentice training and wider retraining opportunities. In response to falling numbers of school‐leavers, British employers use skilled females, whereas German firms are recruiting extra skilled manual labour from East Germany and Romania. As a result of greater certification, German firms have to deal with trade union pressure for linkages between pay and qualifications, even when these are not really required for the job. They also face stronger opposition from trade unions to shift‐work, and enjoy fewer Government training subsidies than British firms. Younger British workers are b...