GERMAN LANGUAGE TALENT - IN OUTSOURCING & SHARED SERVICES ACROSS CEE An analysis of demand and availability by Workwide Group in co-operation with ...
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In co-operation with GERMAN LANGUAGE TALENT IN OUTSOURCING & SHARED SERVICES ACROSS CEE An analysis of demand and availability by Workwide Group in co-operation with German Outsourcing Association April 2019
GERMAN LANGUAGE TALENT IN OUTSOURCING & SHARED SERVICES ACROSS CEE A market place analysis This paper provides an analysis of the demand and availability of German language professionals in Central and Eastern Europe within the Shared Services and Business Process Services sector, which is the largest employer of German speaking talent in the region. The focus of this report is on four destinations with high employment of German speakers: Poland, the Czech Republic, Hungary and Romania. This analysis was initiated and executed by Workwide Group in co-operation with German Outsourcing Association (Deutscher Outsourcing Verband e.V.). If you would like to refer to this paper please contact: simon.nilsson@workwidegroup.com 2 German Language Talent in Outsourcing & Shared Service Across Central and Eastern Europe
Warsaw city sky line CONTENT 4 Summary and method 5 The Business Services Sector Central and Eastern Europe at a glance 6 Demand 7 German language talent in the Business Services Sector (BSS) 8 Type of jobs with German language skills, currently open 9 Examples of German companies operating BSS centres in Poland 10 Availability 11 German language in Central and Eastern Europe 12 German as the native language 13 German as a foreign language 13 University graduates with German language skills 14 Labor cost for German speaking talent in Central and Eastern Europe 15 Current and future demand and availability 16 Case study - Bluelink Czech Republic, relocating German talent 18 Digital & scalable relocation recruitment solutions with Workwide German Language Talent in Outsourcing & Shared Service Across Central and Eastern Europe 3
PREAMBLE Our analysis strongly suggests a growing In Poland for example, 53% of BSS cen- shortage of German speaking talent in tres provide support to the German mar- the Business Services Sector (BSS) across ket. The ratio is higher in the Czech Re- Central and Eastern Europe (CEE). public (75%) and Romania (80%). We found that there are several reasons Our research focused on many aspects behind the shortage including increased of German language supply and de- demand for German speaking talent mand in CEE including the number of across the multilingual Business Services open positions in relevant professions Sector in Central, Eastern and Southern and the distribution of German speakers Europe, an increased demand for Ger- in various locations and groups includ- man talent from the remote gaming ing minorities, expatriates and people industry and the expansion of Europe- with German as a second or subsequent an Headquarters of multinational com- language. panies. We include an overview of labour cost When we combine these trends with and an outlook of the availability of Ger- the low expatriation of German citizens man language talent. Finally, we provide (0.3% of total population per annum) practical examples of recruitment prac- the shortage becomes clear. tices. 4 German Language Talent in Outsourcing & Shared Service Across Central and Eastern Europe
THE BSS The Business Services Sector includes Shared Service Centres (SSC), Business Process Out- INDUSTRY IN CEE sourcing (BPO) and Information Technology AT A GLANCE Outsourcing (ITO). The BSS is among the most important industry sectors in the CEE coun- tries. Many operators and shared service cen- tres have multilingual capabilities and deliver services and support to foreign companies, foreign consumers and foreign business mar- kets including Germany. In order to provide services at a premium level, native language talent is essential. Number of BSS centres and number of employees in the BSS sector Poland Number of BSS centres in the BSS sector Number of employees in the BSS sector 852 193.500 290 100.000 Czech Republic 110 130.000 265 Hungary 125.000 Romania German Language Talent in Outsourcing & Shared Service Across Central and Eastern Europe 5
Prague city DEMAND FOR GERMAN LANGUAGE TALENT ACROSS SELECTED CEE COUNTRIES In this section we consider the demand for German language talent in selected CEE markets. We provide an overview of the type of jobs with German language requirements, and the industries and regions in which those jobs exist. Traditionally there have been several regions within CEE with a strong connection to the German language including parts of Poland, the Czech Republic, Hungary and Romania. We analyse current job openings across different regions as well as past and planned investment by German companies and large international centres in the Business Services Sector serving German clients. The objective is to better understand the current market conditions to enable future investment and recruitment decisions. 6 German Language Talent in Outsourcing & Shared Service Across Central and Eastern Europe
GERMAN LANGUAGE Hungary, Poland, Czech Republic and Romania and other CEE countries have SERVICES a long history in providing business and technology related services to the DEPLOYED IN international and German market. THE BSS SECTOR The reasons for that are geographical ACROSS SELECTED and cultural proximity, marginally larger German speaking minorities, CEE MARKETS strong connection to other industries and the good conditions for cross- border business provided by the European Union. The ratio of businesses providing IT and/or process services in German language is in all countries 2nd, shortly behind English. 5), 6), 7), 8), 9) Number of companies providing services in German language Poland 485 out of 852 companies use German during service delivery 42 out of 52 companies use German during service 33 out of 40 Czech delivery companies Republic use German during service delivery 58 out of 71 companies Hungary provide services in German language Romania German Language Talent in Outsourcing & Shared Service Across Central and Eastern Europe 7
DEMAND TYPE OF JOBS In order to estimate the current demand for German language talent, we have an- WITH GERMAN alysed the number of current job open- ings that require German language skills LANGUAGE SKILLS, in CEE. Primary data for this analysis is CURRENTLY OPEN sourced from country specific versions of the largest job aggregator. Secondary data for this analysis is sourced from national job boards including profes- sion.hu in Hungary, ejobs.ro in Romania, fratrespolsk.pl in Poland and prfesia.cz in the Czech Republic. The results are current at April 2019. The data presented below reflects the to- tal number of job advertisements posted on the largest job aggregator at the time this research was completed. It should be noted that many advertisements were for multiple employees and as such actual de- mand for total employees is likely higher than the total number of advertisements. 10) Number of advertised Poland Czech R. Hungary Romania positions with German language 3007 1029 1166 1483 Required level of language knowledge Most positions (about 82%) require either advanced, native or near-native German language skills. Only a few positions, es- pecially in the technically orientated jobs, require German language at lower to in- termediate levels. 10) 8 German Language Talent in Outsourcing & Shared Service Across Central and Eastern Europe
DEMAND EXAMPLES For the purpose of this report, Poland is used as an example of investment by Ger- OF GERMAN man companies in business service cen- tres. Most of these centres provide services COMPANIES in a number of different languages in addi- OPERATING BSS tion to German. CENTRES IN The total number of German based com- panies that own BSS centres is 59, lower POLAND than the number owned by Polish and United States based companies. 11) Number of centres owned by German TriCity companies in Bayer, Poland Thyssen Krupp Bydgoszcz PWC Frosta Terra Computer Business Consulting Center/SNP Poland Lodz MeeLogic BSH (SSC, IT) Szczecin Huuuge Games Ceri International (SSC) Raynet DHL (SSC) Meelogic T-mobile (SSC) NTConsult Commerzbank (IT) Lintra GFT (IT) Poznan Arvato Rossmann (IT) Computacenter Metro Services Homag Intive Transcosmos Volkswagen Group Services Arvato Services Carl Zeiss GFT Homag Itelligence Lorenz service, MAN Accounting Center Osram Rehau SNP Poland Analyx Number of centres offer- Poznan Lodz Bydgoszcz TriCity Szczecin ing services in German n/a 33 14 34 17 language in total (11) German Language Talent in Outsourcing & Shared Service Across Central and Eastern Europe 9
Budapest, Danube with Chain Bridge AVAILABILITY GERMAN LANGUAGE IN CENTRAL-EASTERN- EUROPE In this section we analyse the availability of German speaking talent in the CEE region with a focus on Poland, the Czech Republic, Hungary and Romania. The available talent is based on the size of the German minority, the number of students that graduate with a German language degree, the number of expatriates from Germany and the number of people that learn German as a second language outside of university studies. Our findings conclude that even though the German language is deeply embedded in these countries, the BSS needs to expand the local and regional German-speaking talent pool to maintain and grow its current service capability. Relocation of talent from native speaking markets is a key factor. To support representatives from the BSS we also include information on labour cost and current and estimated future labour availability in this section. 10 German Language Talent in Outsourcing & Shared Service Across Central and Eastern Europe
GERMAN LANGUAGE IN CENTRAL-EASTERN-EUROPE GERMAN AS norities that consider German as their second native language. NATIVE LANGUAGE Poland There are 150,000 ethnic Germans in German is one of the most spoken for- Poland. About 103,000 of those ethnic eign languages in Europe. Our defini- Germans have dual citizenship with tion of native level German speakers Germany and Poland, and around includes German minorities and Ger- 45,000 are German citizens only. In man expatriates. 2014/15 there were 378 elementary schools teaching German to 37,000 students as a minority language (a German minorities minimum of three sessions of at least 45 minutes per week). Most members In most of the Central and Eastern Eu- of the German minority live in the re- ropean countries we find German mi- gion (Voivodeship) of Opole. 12) 150,000 ethnic Germans live in Poland 96,000 25,000 Hungarians Germans live in speak German the Czech at home Republic PL CZ 36,000 HU ethnic RO Germans live in Romania German Language Talent in Outsourcing & Shared Service Across Central and Eastern Europe 11
GERMAN LANGUAGE IN CENTRAL-EASTERN-EUROPE Czech Republic Romanian names and the current Ro- manian president belongs to the Ger- The German minority is decreasing in man minority. 15) number. In 1970, 81,000 people con- sidered themselves part of the Ger- man minority. By 2001, this number Expatriates had decreased to 39,000 people. We estimate that the current number of Due to the economic relations be- people who consider themselves part tween European countries and the of the German minority has decreased freedom of movement within the further. These people were mostly de- European Union, there is a growing scendants of Germans and Austrians number of expatriates including Ger- that migrated during and after the mans that live and work in the CEE Thirty Years’ War. They primarily lived countries. The rise of digital commu- in the regions of Böhmen, Schlesien nities and platforms such as Interna- and Mähren. 13) tions and Workwide make it very easy for people to relocate. Hungary To quantify how many Germans live in Among our focus nations, Hungary the different countries is difficult be- has the largest German minority with cause foreigners within the European 132,000 people that considered them- Union are only required to register af- selves in 2011 to “belong to the Ger- ter 186 days in a new country. In some man nationality”. There were 96,000 cases they do not register because ex- respondents who reported that they patriates sent by their home country speak German at home. As a result of employer still have their home coun- the large population, there are many try working contract. Occasionally the locations in Hungary that feature bi- expatriate does not see any immedi- lingual town and village signs that in- ate benefit to registering in the new clude German language names and country so they would not fall into our information. 14) statistics. Romania Recent official statistics indicate that 249,000 Germans 15a) or 0.3% of There is a German minority in Roma- the total German population moved nia of about 36,000 people, they are abroad in 2017. This is notably lower relatively disbursed across the large than other countries with sought af- geography of Romania. The German ter language talent, for example Swe- minority is mostly distributed across den (0.6% of total population moved seven smaller towns. abroad in 2015). 15b) Interestingly, a few towns have official Giving consideration to the previous German names in addition to their commentary, we have attempted to 12 German Language Talent in Outsourcing & Shared Service Across Central and Eastern Europe
GERMAN LANGUAGE IN CENTRAL-EASTERN-EUROPE quantify the number of expatriates. Most registered German citizens live However, these figures should be con- in the capital and the northern region sidered indicative due to the issues (Ústecký kraj), close to the German previously outlined. border. 17) In 2017, 825 Germans offi- cially migrated to the country, howev- Poland er 586 returned to Germany. 17a) The number of German registered Hungary expatriates living in Poland exceeds 22,000 and appears to be the second According to the Hungarian press, the highest among all expatriate groups number of German citizens registered in Poland. The migration from Germa- in Hungary is estimated at 80,000. ny to Poland in recent years has aver- 18) In 2017, 1,047 Germans officially aged around 8,000. However, migra- migrated to the country and 654 re- tion is trending downward with 5,068 turned to Germany. 17a) migrants in 2017. Net migration is low, with almost 4,000 Germans returning Romania from Poland to Germany in 2017. 16) 17a) In the first quarter of 2016 there were 5,492 Germans with a registered res- Czech Republic idence in Romania from a total of over 109,000 foreigners. 19) In 2017, there In addition to the German minority in were 782 Germans who immigrated the Czech Republic, there were about to the country and 672 people re- 25,000 registered German citizens in turned to Germany. 17a) 2018. In 2015, the internationally active German “Goethe GERMAN AS Institute” collaborated with German embassies, lo- FOREIGN cal offices of the Goethe-Institut, the Zentralstelle für das Auslandsschulwesen, the Deutsche Akade- LANGUAGE mische Austauschdienst (DAAD) and other part- ners to estimate the number of people who were learning German as a second language. The results are summarised on the following page. 20) When looking at language proficiency, the example of Hungary shows that most language learners at university and other higher education finished with an intermediate level of German language. German Language Talent in Outsourcing & Shared Service Across Central and Eastern Europe 13
GERMAN LANGUAGE IN CENTRAL-EASTERN-EUROPE CZECH POLAND HUNGARY ROMANIA REPUBLIC University students with German 96,555 20,694 9,061 3,238 language German learners in adult and further 49,400 n/a n/a 30,455 education In 2018, this amounted to 19,300 stu- portion of respondents who have stud- dents finishing with an intermediate ied German were located in Hungary level of German. Only 1,800 students with 44%. In comparison, the number finished with an advanced level of of students studying English at univer- German. This amounts to less than sity in Hungary is much higher at 66% 10% of university students graduat- of respondents. In the Czech Republic ing with an advanced or better level these numbers were significantly low- of German. er with 18% of respondents having studied German. 21) The “Flash Eurobarometer 466 survey, 2018” revealed that the highest pro- LABOR COST As it becomes more and more difficult to hire Ger- man speaking talent, the remuneration premium for FOR GERMAN the German language is growing. SPEAKING For example, in Poland there is a language premium TALENT IN of around 20% across finance and HR functions and 50% for software developers. 22) CEE In the Czech Republic the premium for additional language proficiency is between 15% and 30%. 23) While this section is dedicated to the availability of German speaking talent, it is prudent to examine why companies are paying a premium for German language talent. 14 German Language Talent in Outsourcing & Shared Service Across Central and Eastern Europe
GERMAN LANGUAGE IN CENTRAL-EASTERN-EUROPE Demand is influenced by the number port an average hiring time in the BSS of large organisations expanding ex- of 49 days, while the maximum can isting centres or opening new centres. be up to 180 days for selected posi- tions. 24) Importantly, BSS organisations in CEE countries do not only compete Considering the growth rates of the in- among themselves for German ex- dustries in general, we foresee a grow- patriated talent, they also compete ing demand for German speakers. For with Irish and Dutch headquarters example, in the Czech Republic we of multinational companies, the Mal- observe employment growth in the ta and Gibraltar based remote gam- BSS industry of 12% while unemploy- ing industry, the Southern European ment rates in the Czech Republic are Business Services Sector and lastly the at record low levels. maturing European startup scene, all of which have an increasing demand Since 80% of BSS centres in the Czech for language talent. Republic service Germany and the sector is growing at 12%, we expect further growth in demand for German CURRENT AND speaking talent. 25) Other factors that will affect future demand include: FUTURE DEMAND » The growing outsourcing trend in AND AVAILABILITY Germany, caused by significant labour shortages Native language talent is an import- » Trends including digitisation and ant asset for any operator in BSS and development of easy-to-use VOIP and native level service is expected in to- video conference technology day’s market. Business Services com- » The expansion of multilingual services panies considered to be “world-class” handled in shared service organisations see increasing language require- into higher value functions ments as a higher driver for change » The expansion of large global organ- in talent profiles than non-world-class isations in Europe BSS companies. 26) Based on our re- search and through discussions with It is becoming clear that the unfavor- Human Resources and Talent Acqui- able demand vs availability ratio of sition leaders in Business Services, we German speaking talent is creating a observe that the current demand for bottleneck for a large part of the in- German speakers in BSS in the select- dustry, primarily the part of the indus- ed CEE countries is already exceeding try that offers multilingual services. the availability of German speakers in the regional talent pool. This will contribute to an increase in recruitment costs as BPO’s, SSC’s and The total shortage of talent for the BSS recruitment agencies with increasing is becoming a real business challenge. demands compete in a small talent Companies in Hungary for instance re- pool. German Language Talent in Outsourcing & Shared Service Across Central and Eastern Europe 15
Prague city USE CASE Bluelink is a specialist in customer re- INTERVIEW lations management, consultancy & strategy with a focus on the tourism & airline industry. They are located in the Czech Republic with 2,000 employees, and with a high demand for native language talent. Because of the local BLUeLInK shortage of German speaking talent, the company was looking for ways to H u m a n l y D I G I TA L expand how they were reaching and 2.000 recruiting suitable candidates. employees Following are a number of questions 34 and responses from Bluelink, affording some insights into the company’s sit- languages uation, their demands, and how they partnered with Workwide Group to 5 solve the challenge of recruiting native centres German speaking talent. Can you give us a short introduction of your situation in regard to de- mand of language talent? The travel industry is a very dynamic business which is also reflected in our hiring needs. Our recruiters need to be 16 German Language Talent in Outsourcing & Shared Service Across Central and Eastern Europe
USE CASE INTERVIEW MULTI-LANGUAGE CAMPAIGN very flexible and able to re- pany culture and values via act fast to staffing requests. multiple videos and job ads. Additionally, our business is This allowed us to better still growing. Last year we share the experience of our were honoured to welcome current employees in work- a new airline client. This ing with us. We started by year there are further new using Workwide’s version of projects planned. Therefore, job advertisement. we are still in search of suit- able candidates who would As we were specifically tar- like to join our multination- geting candidates from “Attracting al centre in Prague. Germany, we found it very useful that within the cam- German Attracting German speakers paign on Workwide.de, can- speakers has always been a challenge for us. We were searching didates could easily check the cost of living in Prague has always for a way to do two things: and the expenses they been a 1) reach out to potential would have. This makes the experience transparent for challenge candidates in Germany; the candidates and helps for us.” and them to take better in- 2) to present not only our formed decisions. company, but also the life- style in Prague. What were the results? We know that our candi- As a result, we were able dates do not just value the to hire candidates with the job itself, but also the place qualification and language where they live and work. knowledge we were looking for. Through our partnership The combination of reach- with Workwide Group who ing foreign candidates and provided us with their com- providing convincing local bination of targeted job information is very difficult campaigns and additional to communicate in a regu- information about the lo- lar job advertisement. cation of work, Prague, as well as with the relocation How did you go from and expatriate content they there? have provided an extreme- ly helpful solution to one We decided to try Work- of our constant challenges wide Group and their job in reaching and hiring Ger- site Workwide.de, present- man speaking candidates. ing to candidates our com- German Language Talent in Outsourcing & Shared Service Across Central and Eastern Europe 17
Workwide office DIGITAL RELOCATION RECRUITMENT Over 7,500 multilingual SOLUTIONS employees hired worldwide by more than 1,500 organisations via Workwide Group’s native and technology-driven job sites Workwide Group operates native and Our job site and talent community in technology-driven relocation job sites Germany, Workwide.de, is the leading and talent communities. Founded in online destination for native German Sweden in 2014 with the goal of en- talent interested in a career abroad. abling young Europeans to experience working abroad, we have since helped Contact us for more information on thousands of ambitious job seekers to how to attract German, Nordic, Dutch move abroad while developing their ca- and French native language talent via reers. Workwide Group’s scalable, digital solu- tions. Over 1,500 companies, including some of the world’s biggest brands, have used our products and services to attract and Simon Nilsson, recruit multilingual talent to Shared Co-CEO Service Centres, BPOs, EMEA Headquar- T: +46 542 244 440 ters and other corporate environments. E: simon.nilsson@workwidegroup.com 18 German Language Talent in Outsourcing & Shared Service Across Central and Eastern Europe
We would like to thank all organisations that made their research and statistics available and have provided partly individual insights, incl. the ProProgressio Foundation in Poland, the local investment support offices in Szczecin, Bydgoszcz, TriCity, Poznan an Lodz (PL) as well as invest in Poland, ABSL in Poland, in Czech Republic and Romania, the Hungarian Outsourcing Associ- ation, and the Hungarian Investment promotion office, DAAD, and the Goethe Institute. Sources Page 5 planning-further-expansion/ Minderheit in Tschechien” 1) Polish Information and 9) ABSL Romania: “Outsourcing 17 a) www.auswandern-info. Foreign Investment Agency: Industry report 2017” and 2018 com “Business Services Sector in Page 8 18) https://www.wochenblick. Poland 2016” 10) Country pages of www. at/immer-mehr-deutsche-in- 2) ABSL CZ: “BSS sector in indeed.com (pl/hu/cz/ro) and ungarn/ Czech Republic 2019” profession.hu in Hungary, ejobs. 19) https://www.romania-insider. 3) Hungarian Investment ro in Romania, fratrespolska. com/how-many-foreigners-live- Promotion Agency and pl in Poland and profesia.cz in in-romania/ Hungarian Service And Czech Republic 20) Geothe Institute “Deutsch Outsourcing Association: Page 9 als Fremdsprache weltweit “Business Services Hungary 11) Data reported from city 2015” https://www.goethe. Report 2018” investment promotion offices de/resources/files/pdf37/Bro_ 4) Invest in Romania: “Romania’s in Szczecin, Bydgoszcz, TriCity, Deutschlernerhebung_final2.pdf Business Service Sector IT&C, Poznan an Lodz and https://www.goethe.de/en/ SSC & BPO 2018” Page 11 spr/eng/dlz/eur.html Page 7 12) Poland: Wikipedia Page 14 5) The nr. of companies here “Deutsche Minderheit in Polen“ 21) “Flash Eurobarometer 466 refers to the nr. of companies Page 12 survey, 2018, via HIPA, Hungary that the data were based on 13) Czech Republic: Wikipedia 22) Invest in Poland: Business in the different reports, named “Deutsche Minderheit in Services Sector in Poland 2016 below. Tschechien” 23) ABSL Czech Republic ABSL 6) Polish Information and 14) Hungary: Wikipedia Report Czech Republic 2019 Foreign Investment Agency: “Ungarndeutsche“ Page 15 “Business Services Sector in 15) Romania: Wikipedia 24) Hungarian Investment Poland 2016” “Deutsche Minderheit in Promotion Agency and 7) Hungarian Investment Romänien“ Hungarian Service And Promotion Agency and 15a) https://www. Outsourcing Association: Hungarian Service And destatis.de/DE/Presse/ “Business Services Hungary Outsourcing Association: Pressemitteilungen/2018/10/ Report 2018” “Business Services Hungary PD18_396_12411.html 25) ABSL Czech Republic ABSL Report 2018” 15b) https://www.svt.se/nyheter/ Report Czech Republic 2018 8) ABSL Czech Republic utrikes/rekordmanga-svenskar- 26) The Hackett Group’s Annual ABSL Report Czech Republic flyttar-utomlands GBS Performance Study, 2018 2019, https://www.absl. Page 13 Page 16, 17 cz/100-thousand-people-are- 16) Poland: https://migracje.gov. Bluelink CZ now-working-in-the-business- pl Page 18 services-sector-in-the-czech- 17) Czech Republic: ABSL report Workwide Group republic-and-centres-are- 2019, Wikipedia “Deutsche Pictures and graphics Copyright and use of content Pictures: unsplash.com, pixabay.com, Workwide Publishing or re-publishing this paper or parts Group ; Text. 5com media, Workwide, Bluelink ; of it is prohibited without including title, pub- Editorial design, concept, graphics and media licher and link to this paper and prior written production by 5com Media, consent of Workwide group, Sweden. Press con- www.outsourcing-marketing.org tact: simon.nilsson@workwidegroup.com German Language Talent in Outsourcing & Shared Service Across Central and Eastern Europe 19
In co-operation with GERMAN LANGUAGE TALENT IN OUTSOURCING & SHARED SERVICES ACROSS CEE An analysis of demand and availability by Workwide Group in co- operation with German Outsourcing Association www.workwidegroup.com Publishing or re-publishing this paper or parts of it is prohibited without prior written consent of Workwide group, Sweden.
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