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A warm welcome to the April issue of PerchPeek’s Germany Market Monthly update!
Here’s where you’ll find the hottest updates around employee relocation and international talent strategy, insights from our experts on housing and cost-of-living news affecting your staff, the latest trends in global mobility, and tips and tricks on ways to support your teams.
A fly-by summary
● Germany is the hardest country to start a new life as an expat, according to InterNations’ Expat Essentials Index 2023 - PerchPeek’s top tips for People teams
● Latest Berlin rental costs; Berlin government aims to build 32,500 new flats in next five years, while authorities recommend moving to the countryside for cheaper rent
● The German government is to establish migrant centres in five African countries to attract skilled workers, in an effort to combat Germany’s severe worker shortage
● The new Deutschlandticket, offering unlimited regional train travel throughout Germany for €49 per month, has now gone on presale and will be valid from 1st May
● Helping relocating employees explore their surroundings: new international hourly train service, and PerchPeek’s favourite car sharing and bike sharing providers
Relocating to a new country can be a stressful and difficult experience for most people when they’re new to the area, the local administrative procedures and sometimes the language.
Unfortunately, it seems newcomers to Germany are in for the biggest challenge, as the country has recently been ranked as the hardest country to start a new life as an expat.
In the new InterNations Expat Essentials Index 2023 where 52 countries were assessed, Germany has come out as the country with the most hurdles for new arrivals to jump. To reach this conclusion, InterNations took four-subcategories into account:
PerchPeek’s advice to People teams:
The quality of life in Germany is excellent and has a lot to offer relocating employees, but clearly, getting settled in can be a real challenge. Of course, you want them to start off on the right foot so they can get stuck in and thrive in their new role. Here are our top tips:
● Offer comprehensive support throughout the relocation process. Relocating staff will have many questions, and having an expert sounding board will make a huge difference! This doesn’t need to cost a fortune but will massively help both with the lack of knowledge an expat has of setting up a life in Germany, and with high levels of stress.
● Manage expectations from the get-go around Germany’s very challenging rental market, and review relocation packages to cover several months in temporary accommodation, to allow relocating employees to get through admin challenges and find a suitable long term home.
● Share details of bureaucratic processes, and in particular, advise staff that they’re likely to need paper copies of documents, as digital processes aren’t common!
German rental market update
● The German Association of Towns and Municipalities has recommended that those struggling to find rental properties in Germany’s major cities should move to the countryside, where over 1.3 million market-ready flats lie empty, they claim
● Berlin’s new coalition government has revealed its new housing policy, which includes a soft target to build 20,000 new houses in the capital per year
● This policy also includes a goal of building 32,500 new apartments in Berlin over the next five years (6,500 per year)
Minimum rental costs - Q1 2023 (source: PerchPeek):
* Long-term prices are based on warm rent (Warmmiete) which includes utilities such as water, gas and heating. Electricity and internet are extra and will add €100-€200 per month.
For more rental cost data for Germany, give PerchPeek a shout here!
Insights from PerchPeek’s Germany experts
The rental market in Germany’s major cities remains as crazy and competitive as ever. Just recently, it made the national news when a two-bedroom Berlin apartment was listed at €1,074 and it received over 600 applications within an hour, and a 150-metre queue formed outside!
To support relocating employees looking for a home, consider encouraging them to look at housing further away from major cities, given the current statistics. Of course, it’s important to review transport links to the office, as well as flexible working options, to facilitate this.
As we mentioned in our last issue, Germany has been struggling with a severe shortage of skilled workers. Data shows nearly 2 million unfilled jobs in the last quarter, costing a hefty €86 billion per year, with warnings the country could be short of 7 million workers by 2035.
To tackle this skills shortage, the government is working on a number of projects and initiatives to make it easier for skilled workers from other countries to arrive and settle in Germany.
As well as significant immigration reform in the form of the new Skilled Workers Immigration Act, making the visa application requirements and procedures quicker and less stringent, a notable project is to establish migrant centres in five African countries in order to attract skilled talent.
Key details:
● Migrant centres are to be established in Nigeria, Ghana, Morocco, Tunisia and Egypt
● Those being sought are skilled workers with academic or vocational qualifications, managers, researchers and scientists
● Applicants must have a work contract or concrete job offer to be granted a visa
How can companies benefit?
This project poses a great opportunity for People teams to look to fill roles by targeting these African countries’ brightest professionals. Talent acquisition teams are advised to increase hiring efforts for qualified individuals, and to keep on top of developments in visa processing. And of course, having a comprehensive relocation plan will be essential for attracting the best talent.
We’ve been keeping an eye on the projected launch date for the long-awaited new €49 rail ticket, making nationwide travel more affordable for consumers and are thrilled to announce that ticket presales are now open!
What is the €49 rail ticket?
The new nationwide rail ticket - the Deutschlandticket - allows unlimited travel on regional trains anywhere in Germany for €49 per month, any day of the week, including holidays. It’s valid on any train operated by Deutsche Bahn, and will be available for at least the next two years.
When does it go on sale?
Ticket presales opened on 1st April via the ‘Dein Deutschlandticket’ app, and tickets will be valid from 1st May onwards. It’ll also soon be an option to purchase the ticket on the Deutsche Bahn ‘DB Navigator’ app.
How to help employees benefit
This deal has been hotly anticipated by German residents who’ll now be able to traverse the country for a more reasonable price. However, some employers are going the extra mile and subsidising the cost of the ticket to help employees struggling with the cost of living crisis. These include Vodafone, insurance provider Ergo and pharmaceutical company Bayer AG.
Advice for People teams:
● Consider subsidising the cost of this and other public transport ticket options
● Help relocating employees understand their transport ticket options and how to purchase
● Provide helpful information on the best ways of getting around (see below!)
A big part of settling into life in a new country is getting to know one’s surroundings and exploring the new environment (ideally, as efficiently and cost-effectively as possible!).
In order to support relocating employees and help them navigate their new home, here are PerchPeek’s top tips and key information to share with them:
New international train service
We’re big fans of seeing the world by rail, and are excited about the new €49 ticket! To add to this exciting development, a new tri-state train will connect Aachen, Maastricht and Liège. It’s promising news for relocating employees looking to see more of their new European environs!
Car sharing
In Germany, car sharing - where you hire a car on a journey-by-journey basis - is an increasingly popular alternative to car ownership, with almost 4.5 million German residents registered with car sharing apps - a 30% increase on a year ago!
Our favourite car sharing providers include:
● Miles
● Free Now
● Share Now
● Cambio
Bike sharing
Major German cities like Berlin, Frankfurt and Hanover are some of the most bike-friendly cities in the world, with hundreds of kilometres of cycle lanes, plus plenty of parks and green spaces. For those who don’t own a bike but are still keen to get around on two wheels, bike sharing is the perfect flexible solution. Here are some of our favourite providers:
● Swapfiets
● Nextbike
● Donkey Republic
● Lime
We hope you enjoyed this month’s update!
If you have any feedback, comments or questions about what's happening in your location, feel free to reach out via the form at the bottom of this page.
Thanks for reading, and see you next month!
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We hope you found this update insightful! We’d love to hear your thoughts.
PS - if you’d like next month’s PerchPeek Netherlands Market update delivered start to your inbox, you can signup here:
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