But the underlying skills shortage has not disappeared. It is merely being masked by weak economic conditions. The real question is therefore: What will your company do with this breathing space before orders pick up again?<\/strong><\/p>\n The latest figures reveal one important trend: Small and medium-sized enterprises (SMEs) are more severely affected by skills shortages than large corporations.<\/p>\n In April 2026, 22% of German SMEs reported difficulties finding skilled workers, compared with 19.3% of large companies. The gap is even wider in manufacturing: 18.3% of SMEs reported shortages, versus just 8% of large enterprises.<\/p>\n Dirk Schumacher, Chief Economist at KfW, attributes the current easing primarily to Germany’s weak economic performance. He expects skills shortages to intensify again once the economy recovers.<\/p>\n The German Economic Institute (IW) paints a similar picture. According to its labor market projection through 2029<\/a> (available in German only), Germany’s skilled labor gap could increase to approximately 723,000 workers, representing a rise of 47%.<\/p>\n Importantly, this is a continuation of existing trends rather than a forecast.<\/p>\n One particularly striking finding is that industrial occupations such as mechatronics and mechanical engineering are moving higher in the shortage rankings, even as industrial employment declines.<\/p>\n A further dimension is emerging: the relationship between skills shortages and investment.<\/p>\n An IW study commissioned by the BlackRock Foundation estimates an average shortage of more than 148,000 skilled workers for infrastructure, the energy transition and digitalization alone (B\u00f6rsen-Zeitung, October 19, 2026<\/a>, available in German only).<\/p>\n The underlying message is clear: Capital investment alone does not create execution capacity.<\/strong><\/p>\n This applies equally to Germany’s federal infrastructure investment initiatives and to the growth ambitions of family-owned businesses.<\/p>\n Another structural shift is underway. According to figures cited by the ifo Institute, German industry has lost almost half a million jobs subject to social insurance contributions since 2019. Over the same period, the service sector has created more than 2.2 million jobs.<\/p>\n Experienced industrial specialists leaving the workforce today will not automatically be available when the next economic upturn arrives.<\/p>\n For years, the discussion surrounding skilled labor shortages has largely focused on recruitment.<\/p>\n Who can attract qualified candidates faster? Which company has the more effective employer brand? How can hiring processes be accelerated?<\/p>\n These questions matter, but they overlook the fundamental problem.<\/p>\n The real challenge is a mismatch between business and workforce development timelines.<\/strong><\/p>\n New orders, investments and market opportunities can materialize within weeks. Developing critical capabilities, however, often takes months or even years.<\/p>\n Despite this reality, many executive teams continue to plan in the opposite direction.<\/p>\n According to PwC\u00b4s 29th Global CEO Survey<\/a>, German CEOs spend 49% of their time on issues with a planning horizon of less than twelve months. Only 15% of their time is devoted to decisions extending beyond five years.<\/p>\n At the same time, 57% question whether their organizations are transforming quickly enough.<\/p>\n A special survey conducted as part of the KfW SME Panel illustrates the potential consequences.<\/p>\n According to the findings, 58% of SMEs anticipate difficulties filling vacancies over the next five years. Among those businesses, around 40% consider it likely that they will have to decline orders because of staffing constraints\u00a0(VerkehrsRundschau, March 2025<\/a>, available in German only).<\/p>\n In other words, future growth may be constrained not by market demand, but by the organization’s own ability to deliver.<\/p>\n Why does this challenge affect smaller companies particularly severely?<\/p>\n Large corporations can often compensate for skills shortages across locations, business units and budgets. SMEs rarely have the same flexibility.<\/p>\n In a medium-sized manufacturing company, entire product lines may depend on just a handful of highly specialized employees.<\/p>\n The skills shortage in SMEs<\/strong> is therefore not simply an HR issue. It is a strategic question of delivery capability, competitiveness and sustainable growth.<\/p>\n There is also good news.<\/p>\n The temporary easing of labor market pressures creates valuable time for companies willing to act before demand accelerates again.<\/p>\n Those that use this period strategically can enter the next economic upturn with a significant competitive advantage.<\/p>\n From my perspective, five steps make the difference.<\/p>\n Traditional workforce planning counts positions and employees.<\/p>\n Strategic workforce planning asks a different question: Which specific roles and capabilities actually determine whether the company can grow?<\/a><\/p>\n These are often specialists in engineering, commissioning, data management, automation or technical sales.<\/p>\n When capacity is missing in these roles, entire value chains can be disrupted.<\/p>\n Addressing the skills shortage in SMEs<\/strong> therefore starts with identifying the few critical positions that directly influence operational capacity and future growth.<\/p>\n The objective is not to create a comprehensive list of vacancies, but to identify the positions where a shortage could have the greatest business impact.<\/p>\n What would happen if incoming orders increased by 20%?<\/p>\n How many additional employees would be required? More importantly, which skills and competencies would become critical?<\/p>\n In \u201cThe State of Organizations 2026\u201d<\/a>, McKinsey recommends regularly assessing operating models and talent pipelines against alternative future scenarios.<\/p>\n For SMEs, this means developing two or three realistic growth scenarios rather than simply extrapolating last year’s staffing levels.<\/p>\n Each scenario should identify:<\/p>\n This approach transforms workforce planning from a reactive administrative exercise into a forward-looking management instrument.<\/p>\n Every critical workforce gap can potentially be addressed through several approaches.<\/p>\n Companies can develop capabilities internally, recruit externally, collaborate with partners, retain key employees or automate selected activities.<\/p>\n Each option involves different costs, risks and implementation timelines.<\/p>\n Internal development may take years. External recruitment can require several months. Partnerships may provide faster access to expertise, while automation can reduce dependence on specific roles.<\/p>\n Managing the skills shortage in SMEs<\/strong> therefore requires a deliberate combination of measures rather than relying on recruitment alone.<\/p>\n The critical decision is not merely which option to choose, but when to initiate it.<\/p>\n That decision needs to be made today, not when the next wave of orders is already arriving.<\/p>\n Before committing to major investments, management should take a critical look at organizational readiness.<\/p>\n Are leadership structures, processes and competencies prepared for the next phase of growth?<\/p>\n Can the organization scale operations without creating new bottlenecks?<\/p>\n Are critical dependencies on individual employees sufficiently understood?<\/p>\n Or could the company’s growth strategy fail because of workforce constraints that are already visible today?<\/p>\n A structured readiness assessment can reveal these risks before they turn into operational problems.<\/p>\n An external perspective is particularly valuable. Internal teams may become accustomed to existing limitations and recognize critical shortages only when they begin affecting delivery performance.<\/p>\n Identifying organizational constraints early is far less costly than recovering from a missed growth opportunity.<\/p>\n Critical workforce capabilities should be reviewed with the same discipline as revenue, profitability and cash flow.<\/p>\n The underlying value chain is straightforward:<\/p>\n Critical skills \u2192 Operational capacity \u2192 Delivery capability \u2192 Revenue and profitability<\/strong><\/p>\n This relationship needs to become transparent.<\/p>\n Relevant management indicators include the availability of critical competencies, time to fill strategic positions, time to full productivity and dependence on individual experts.<\/p>\n By integrating these indicators into quarterly business reviews, organizations can monitor whether their workforce capabilities remain aligned with strategic objectives.<\/p>\n Only then does workforce planning become a measurable management responsibility rather than an isolated HR activity.<\/p>\n What does this approach look like in practice?<\/p>\n Two examples illustrate how organizational size influences the methods used, while the underlying strategic logic remains the same.<\/p>\n Initial Situation<\/em>: The Brandenburg-based mechanical engineering company bip technology exports its products worldwide.<\/p>\n However, the company struggled to find qualified candidates in its region who were willing to undertake international assignments (ZDFheute, March 2026<\/a>, available in German only).<\/p>\n <\/i><\/i><\/i><\/i><\/i><\/i><\/i><\/i><\/i><\/i>Challenge<\/em>: The company needed to fill critical skilled positions for which the regional labor market could no longer provide sufficient candidates.<\/p>\n Approach<\/em>: The company expanded its recruitment efforts internationally, including to Morocco and Iran.<\/p>\n It received support through a program involving the German Chambers of Industry and Commerce (DIHK) and the Federal Employment Agency.<\/p>\n Outcome<\/em>:\u00a0Today, one-quarter of the company’s workforce has a migration background.<\/p>\n However, the first recruited mechatronics technician required eight months before entering Germany.<\/p>\n The lesson is clear: Organizations that begin addressing critical workforce shortages only when order books are full may already be too late.<\/p>\n <\/i><\/i><\/i><\/i><\/i><\/i><\/i><\/i><\/i><\/i>Initial Situation:\u00a0<\/i>An internationally operating company with several tens of thousands of employees faced substantial projected net workforce demand while also experiencing the departure of experienced managers.<\/p>\n Existing workforce planning was largely quantitative. Critical roles and competency dependencies remained insufficiently visible.<\/p>\n Challenge<\/em>:\u00a0The company’s business strategy needed to be translated into reliable workforce requirements.<\/p>\n Approach<\/em>: Working with HR and business units, STRIMgroup identified critical capability profiles, including specialists in data and IT as well as international engineering.<\/p>\n Future demand and existing workforce capacity were compared across job families, regions and organizational units.<\/p>\n Based on workforce segmentation<\/a>, appropriate measures were selected for each identified capability gap.<\/p>\n <\/i>Outcome: <\/i>A value-driver tree now links workforce measures to management indicators.<\/p>\n The analysis also revealed an important methodological insight: Nominal revenue was becoming less reliable as a driver of workforce demand, while volume-based operational indicators provided a more robust basis.<\/p>\n Further details on this approach are discussed in our article on strategic workforce planning with people and AI<\/a>.<\/p>\n Although the two organizations differ significantly in size and complexity, the underlying approach follows the same principles:<\/p>\n In a small manufacturing company, a single critical appointment may determine operational performance for months.<\/p>\n In a large corporation, systematic workforce planning can shape organizational capabilities for years.<\/p>\n In both cases, workforce shortages become more manageable once they are treated as strategic business risks rather than isolated staffing problems.<\/p>\n Workforce risks can no longer remain exclusively within the HR function.<\/p>\n They must become part of strategic business management.<\/p>\n For CEOs<\/strong>: Make Workforce Risks Part of the Growth Strategy<\/p>\n The CEO determines whether critical workforce risks are explicitly incorporated into business strategy and strategic investment decisions.<\/p>\n Without this commitment, workforce planning often remains an HR exercise with limited influence on corporate priorities.<\/p>\n The central question is whether the organization possesses the capabilities required to execute its growth strategy.<\/p>\n For CFOs<\/strong>: Treat Workforce Bottlenecks as Investment Risks<\/p>\n CFOs should assess critical workforce constraints using the same economic discipline applied to capital investments.<\/p>\n An unfilled specialist position can potentially result in greater lost revenue than a delayed machinery investment.<\/p>\n Workforce-related risks therefore belong in financial planning, investment evaluations and performance management.<\/p>\n For CHROs<\/strong>: Translate Business Scenarios into Workforce Requirements<\/p>\n CHROs need to derive workforce demand from strategic scenarios rather than existing staffing plans.<\/p>\n This also requires management indicators that are meaningful beyond the HR function.<\/p>\n Examples include:<\/p>\nWhy the Skills Shortage in SMEs Needs Reassessment Now<\/span><\/h3>\n
![\"Skills](\"https:\/\/www.strimgroup.com\/wp-content\/uploads\/2026\/10\/STRIM_skills_shortage_comparison_EN.png\")
<\/a><\/p>\nThe Blind Spot: Orders Return Faster Than People<\/span><\/h3>\n
Skills Shortage in SMEs: Five Steps Successful Companies Take Now<\/span><\/h3>\n
![\"Five](\"https:\/\/www.strimgroup.com\/wp-content\/uploads\/2026\/10\/STRIM_five_steps_EN.png\")
<\/a><\/p>\n1. Focus on Bottlenecks, Not Headcount: Identify Critical Roles<\/span><\/h4>\n
2. Use Scenarios Instead of Extrapolation: Derive Workforce Demand from Strategy<\/span><\/h4>\n
\n
3. Develop Options for Each Bottleneck: Build, Buy, Borrow, Retain or Automate<\/span><\/h4>\n
4. Assess Readiness: Can the Organization Support Growth?<\/span><\/h4>\n
5. Integrate Workforce Metrics into Management Reviews<\/span><\/h4>\n
Skills Shortage in SMEs: Two Practical Examples, One Principle<\/span><\/h3>\n
Case 1: A Manufacturing SME with 45 Employees<\/span><\/h4>\n
Case 2: A Large International Electrical Engineering and Automation Company<\/span><\/h4>\n
The Common Principle<\/span><\/h4>\n
\n
What the Skills Shortage in SMEs Means for CEOs, CFOs, and CHROs<\/span><\/h3>\n
\n