The catchiest phrase was found last week by Hubertus Heil, Federal Labor Minister of the SPD with a good chance of a further term in office: "We are making Germany a republic for further education," he wrote in the short message service Twitter about the coalition agreement between the Ampel partners.

An ambitious goal.

Britta Beeger

Editor in business.

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And one that is hardly controversial: In view of the enormous structural change in the German economy, more needs to be done in terms of further training, employers, unions, economists and politicians from various camps agree on this. Because digitalization and the switch to climate-neutral production mean that tasks and jobs are no longer required, and new qualifications are required. However, there are different ideas about how one could give the further training of employees a boost.

In the coalition agreement of the future federal government consisting of the SPD, the Greens and the FDP, one project in particular catches the eye that is only outlined in two sentences: With a qualification allowance based on short-time work allowance, the Federal Employment Agency is to enable companies undergoing structural change to train their employees through qualification to keep them in operation and to secure skilled workers. A company agreement should be a prerequisite for this.

This proposal was already in the election manifesto of the Greens.

Its declared aim is not only to wish companies a safe journey on the road to climate neutrality, but also to actively support them - for example through more financial support for the retraining of employees.

The SPD, in turn, had taken up the IG Metall's idea for a “transformation short-time work allowance” in its election program, which is based on a similar idea: to finance further training for employees rather than unemployment with the funds of the contributors.

With the qualification money and other projects of the Ampelkoalition, the Federal Employment Agency (BA) would also have a stronger role in further training - as the SPD in particular has long been calling for.

"No need for a qualification allowance"

How all of this should look in practice will only become apparent in the legislative process. The employers are nevertheless alarmed, and some of the Ampel partners' plans even meet with clear rejection. There are two main reasons for this: On the one hand, they see the main responsibility for further training with the companies and their employees - they know best which further training is sensible. On the other hand, the grand coalition has already greatly expanded further training funding in the legislative period that is now ending, especially with the Qualification Opportunities Act that came into force at the beginning of 2019. Until then, it was mainly the unemployed as well as older and less qualified employees who could receive funding, but it is now basically open to all employees.With the so-called Work of Tomorrow Act, the funding was expanded again: Depending on the size of the company and other criteria, wage subsidies of between 25 and 90 percent are paid and up to 100 percent of the further training costs are covered.

In view of the wide range of funding opportunities, there is “no need for a qualification allowance”, according to an internal statement by the Federation of German Employers' Associations on the coalition agreement.

Instead, it is necessary to make the existing funding more flexible and to simplify it, which many companies actually perceive as bureaucratic and complex.

Holger Schäfer, labor economist at the employer-related Institute of the German Economy in Cologne, sees it similarly: The first question is whether there are reliable findings that the existing instruments are not sufficient.

"In my opinion that is not the case."

Stronger role for employment agency

So what is the qualification allowance for? The traffic light partners should be interested in creating more general access to further training funding. Specifically: about cases in which entire companies have to reinvent themselves due to structural change. What is striking in this context in the coalition agreement is the formulation that the Federal Employment Agency “can” pay the qualification allowance - apparently there should be no legal claim, rather the employment agencies would decide at their own discretion. Enzo Weber from the Institute for Employment Research, which is part of the BA, is nevertheless skeptical whether the money is sensibly invested in this way. For example, some employees might have good chances in another company, he says. Weber would also be more in favorto tackle the existing individual funding opportunities again.

In addition to the qualification money, the traffic light parties want to advance further training with a few other projects. The Federal Employment Agency is to be networked more closely with regional actors in terms of advice. This is already happening in practice, which is why the employers, who are also on the BA's board of directors, are skeptical of a centrally planned solution. In addition, placement in work should no longer have priority over vocational training and further education that improves employment opportunities. In order to increase the financial incentive, recipients of unemployment benefits and basic security also receive a further training allowance of 150 euros per month. BA boss Detlef Scheele was satisfied on Tuesday with the coalition agreement negotiated by his SPD party friend Olaf Scholz: "We'll find him,as far as we are concerned, quite successful. "