Eastern Germany faces significant labor shortages

Eastern Germany is facing a significant labor shortage as German citizens leave the region. According to a report by the German Institute for Economic Research (IW), between 2023 and 2025, the eastern states lost approximately 141,000 workers with German citizenship. While the number of employees without German passports increased by 90,000, overall employment in the eastern states fell by 0.8 percent.

Experts warn that the situation may worsen due to retirements and a trend of return migration to Eastern European countries, such as Poland, where economic conditions have improved. The study notes that the share of foreign nationals among employees in eastern Germany rose from 4.8 percent in 2015 to 13.3 percent in 2025.

To prevent negative impacts on economic well-being and the supply of goods and services—particularly in the care sector—the IW suggests that Germany must strengthen the immigration of skilled workers from third countries to fill the emerging gaps in the labor market.