The dual vocational training system is a major asset for Germany's innovation power, an aspect systematically underestimated in international studies. The highly innovative medium-sized businesses without proprietary research departments in particular greatly appreciate the well qualified skilled labour in this country.
For these businesses, they even constitute the most important factor for innovation of all. This is a central conclusion of the INSM Innovation Monitor 2012 prepared by the Cologne Institute for Economic Research (IW) on behalf of the New Social Market Economy Initiative (INSM).
According to this study, as Hans-Peter Klös, head of the IW, affirmed, Germany achieves a "solid sixth rank" in the international comparison of 28 industrialised countries. Germany ranks behind Finland, Switzerland or Korea, but significantly ahead of the USA, the United Kingdom or the Netherlands.
The competence of pupils in the natural sciences and the research effort on the part of enterprises – both as regards their expenses for research and development and their patent applications – are particular points of strength in this country.
According to the study, Germany is leading when it comes to vocational training. The so-called industrial innovators without their own research and development (R&D) departments in particular benefit from the number of apprentices in technical occupations. The study thus invalidates the OECD's (Organisation for Economic Co-operation and Development) standard critique, that the rate of academics was too low in Germany.
After all, many medium-sized businesses in particular, urgently require not only university graduates, but also skilled personnel with a completed apprenticeship for maintaining their innovation capability and competitive capacity.
The IW examined the innovation capability of 28 countries on the basis of 18 key indicators, among them, for example, pupils' school performance in the natural sciences according to PISA, the share government investments in R&D have in the gross domestic product or the infrastructure as regards information and communication technology.
These key indicators were assessed on the basis of a survey including more than 2000 German enterprises with innovative power. The ranking therefore is indicative of how well a country performs from the point of view of German enterprises.
INSM Managing Director Hubertus Pellengahr called upon German politicians to safeguard the supply with skilled labour also for the future in a country with decreasing population. "In addition to improved qualification options, it is important to render the immigration policy overall more welcoming", he said.
"An increased removal of barriers within and improved flexibility of the education system, more students from abroad, and women in so-called MINT professions (maths, informatics, natural sciences and technology) are further approaches towards strengthening the innovation capability."
As a matter of fact, innovation as regards products and production processes constitutes an important motor of economic growth in Germany. Given the comparatively high cost of labour, enterprises put an increasing emphasis on innovative goods and services in order to persevere in the global economy.
Pellengahr reckons that the demand for personnel with a technical or natural scientific qualification will continue to rise over the course of the coming years. The reasons for this, he says, are demographic change on the one hand and new trends, such as electro-mobility and renewable energies, on the other.
Head of the study Klös established that many European countries did very well in the innovation ranking. However, under no circumstances were they allowed to rest on their laurels. For China, not a member of the OECD and therefore not included in the study, had gained much ground in the competition for innovation.
The authors of the monitor see a direct connection between the ranking of the 28 countries examined and their degree of creditworthiness. Among the eight best countries, seven achieved an AAA in their national credit rating. Of the 11 countries bringing up the end of the list – with Turkey, Greece and Italy coming last – not a single one features this rating.
"The countries affected by the crisis of the Euro have joint weaknesses as regards their research conditions, research efforts as well as their framework conditions for implementing new ideas", explains Klös. He recommends progress with regard to innovative capability for increased growth as well as consolidation of the budget. The only problem could be, that the innovative capability of a country rests on the shoulders of thousands of enterprises and therefore is difficult to promote by the government.