Struggling to Compete? German Firms Battle a Shortage of AI Talent
AI Talent Sought Intensively by German Companies
Take a peek at the German job market, and you'll find a startling truth: vacancies for AI experts have been static for years. If you zoom in on two cities and one district, you'll notice a spike, but experts are ringing the alarm bells.
An analysis of about 60 million online job ads between 2019 and 2024 by the Bertelsmann Foundation points to this stagnant state. Since 2022, job openings in the crucial future domain of AI have been hovering at a low level, prompting concerns over a competitive disadvantage in the international arena.
Companies themselves are increasingly feeling the heat, with many already falling behind in the AI game. As Michael Hüther, director of the Institute of the German Economy, puts it, companies need to put their business models to the test. He calls for increased investment in employee competence and streamlined AI regulation implementation.
But despite more and more companies harnessing the potential of AI for productivity gains, the talent pool is quite shallow. According to the study, while the number of job listings for computer scientists, software developers, or other specialists with AI expertise has nearly doubled from 97,000 to 180,000 between 2019 and 2022, this accounts for a mere 1.5% of all job listings.
Since 2022, the overall number of job offers in this area has taken a dip to approximately 152,000 ads. However, considering the economic downturn, the proportion of AI jobs remains relatively steady. On the flip side, job listings in the booming sector of the energy transition have been on the rise, reaching 3.8% of all job listings.
When companies are on the hunt for AI-adept employees, the job listings primarily target well-trained specialists in AI development. On the other hand, AI-proficient users, such as in advertising and marketing or sales, are less frequently pursued.
Regionally, disparities exist: AI plays a negligible role in the job market in half of all German districts and independent cities. Conversely, AI hotspots can be found in places like the city of Munich, the research location of Karlsruhe, and the district of Böblingen near Stuttgart. Other regions in southern and southwestern Germany, as well as the metropolitan areas on the Rhine and Ruhr and in the Berlin metropolitan area, also boast AI hotspots.
References:* ntv.de* chl/dpa/AFP
** AI** Labor Market
Additional Insights:
- Lack of AI Literacy: Only 20% of Germans have undergone training or further education on AI, which is significantly below the global average of 39%. This could limit the effective integration of AI, leading to a perceived stagnation in demand for experts.
- Unclear Regulatory Framework: The lack of clear guidelines and regulations regarding AI usage can lead to skepticism and hesitation among companies to invest heavily in AI talent.
- Preference for Local AI Solutions: German companies often favor AI systems developed within Europe due to concerns over data sovereignty and regulatory compliance. This might limit the demand for external AI experts if companies are not heavily investing in AI development locally.
- Competitive Disadvantage: The lack of AI expertise and slow adoption of AI technologies could place German companies at a competitive disadvantage compared to international peers, especially in sectors where AI is crucial for innovation and efficiency.
- Limited Innovation: Without skilled AI professionals, German companies may struggle to leverage AI's potential for innovation and productivity enhancements, potentially hindering their ability to adapt to changing market conditions.
- Dependence on External Solutions: Relying heavily on AI models from US providers could lead to dependence on foreign technologies, which might not fully align with local regulatory or strategic needs.
- To combat the competitive disadvantage in AI technologies, German firms might need to reconsider their community policy, emphasizing AI literacy training and the acquisition of employment policies that attract AI-skilled professionals.
- In the pursuit of maintaining a competitive edge, the implementation of technology such as artificial-intelligence within companies requires streamlined AI regulation, as well as investment in improving employee competence and AI-related skill sets, to help bridge the talent gap and boost Germany's AI job market.
