In Germany, advertising for emigration is prohibited, while its best minds quietly turn their backs on it

Voting with their feet: Why the German economy is currently losing its most important players

Better than Germany? Why high performers are suddenly preferring to emigrate to Poland or Romania

Germany's economy is hemorrhaging – silently, but with fatal consequences. While politicians tirelessly debate the skilled worker shortage, high-achievers and companies have long since voted with their feet. Record taxes, crushing bureaucracy, and an often inadequate welcoming culture drive hundreds of thousands of highly qualified Germans and immigrants abroad every year. The fiscal losses for the state run into the billions, and the damage to innovation is almost incalculable. Instead of consistently tackling the structural causes of this exodus, however, lawmakers are clinging to a bizarre 1975 law that simply prohibits commercial advertising for emigration under threat of hefty fines. This is an in-depth analysis of why the country is losing its best minds, why neighboring countries have suddenly become more attractive – and what needs to happen now to stop this unprecedented exodus.

When high performers leave – Germany's silent economic crisis

There is a remarkable paragraph in German law that is symptomatic of the country's current state: According to Section 2, Paragraph 1 of the Emigration Protection Act (AuswSG) of 1975, it is forbidden to commercially solicit emigration. Anyone who violates this law commits an administrative offense punishable by a fine of up to €20,000. The irony of this regulation becomes fully apparent when compared to reality: In 2023, Germany recorded a total of approximately 1.3 million emigrants, including about 265,000 Germans and over one million foreigners. The law protects against the word, not against the phenomenon itself. This is not a minor detail. It is a reflection of reality.

A law from 1975 meets a world of 2025

The Emigration Protection Act was enacted at a time when government authorities still believed they could control population movements through bureaucratic prohibitions. The historical core of the law was originally sensible: it was intended to protect those wishing to emigrate from unscrupulous agents and false promises—a reaction to the mass migration of the 19th century, when people were lured to the USA under false pretenses. Today, however, Section 2 seems like an anachronistic relic of an era that still believed emigration was a communication problem that could be solved through prohibitions.

In fact, the law doesn't regulate the individual decision to emigrate, but rather the commercial, long-term advertising for it. Nevertheless, the mere existence of this regulation reveals a bureaucratic reflex: regulating the symptoms, not the causes. Anyone who takes this law seriously in 2025 must ask themselves why the German legislature apparently prefers to restrict discussion about emigration rather than improve the conditions that motivate people to leave.

The numbers behind the silence

Official statistics tell a sobering story. In 2023, around 265,000 Germans with German passports left the country – a net migration loss of 79,554 German citizens. Since the 1990s, the emigration rate of Germans has been rising slowly but steadily, with a particularly sharp increase in 2016. Across all emigrants – Germans and foreigners alike – there were approximately 1.26 million departures from Germany in 2024.

The figures appear manageable when viewed in their entirety, as long as one only measures quantity. The real problem lies in the quality of those emigrating. According to the Bertelsmann Foundation's 2024 Migration Monitor, an average of around 20,000 skilled workers from non-EU countries emigrated annually in recent years, all of whom held a residence permit for employment purposes – almost exclusively highly qualified individuals. An IAB study from 2025 puts the number of immigrants considering emigration at an estimated 2.6 million, of whom 300,000 already have concrete plans. In knowledge-intensive sectors such as information and communication, and financial and insurance services, between 30 and 39 percent of respondents are considering leaving.

The Kiel Institute for the World Economy identified the problem early on: In ten years, Germany will lose half a million net high-achievers, and foreign immigrants cannot fully compensate for the loss because they are often not sufficiently qualified, linguistic and cultural barriers exist, and many highly qualified individuals among them also move on again after a short time.

What really motivates people to leave

The reasons for considering emigration are well documented. In a 2025 survey by the Friedrich Ebert Foundation of 400 emigrants, often highly qualified foreigners, the lack of a welcoming culture and dissatisfaction with social life in Germany were the top reasons. Professional reasons, such as better pay abroad, came in second, followed by concrete job offers (22.6 percent) and family reasons (20.7 percent).

In the IAB study 2025, those considering emigration cite dissatisfaction with the political situation in Germany (44 percent), personal motives, a perceived excessive tax burden, and the search for a better job. Considerations of emigration are particularly widespread among highly qualified individuals, higher earners, and those employed in shortage occupations. This is not mere statistical noise, but a structural signal: the country is preferentially losing those it needs most.

The most popular destinations are not long-haul destinations. Switzerland remains the preferred destination for those migrating further afield, followed by the USA and Spain. Within Europe, many are drawn to Poland and Romania – countries that were considered economically weaker just a generation ago. The fact that neighboring Poland can now be a more attractive destination than Germany is, in itself, a finding of considerable political significance.

The fiscal price of the exodus

The economic costs of this emigration have been precisely calculated. The ifo Institute for Economic Research has determined that the state incurs a fiscal loss of €281,000 when a 23-year-old metalworker emigrates. If a 30-year-old doctor leaves the country, the loss to public coffers amounts to almost €1.1 million – solely in lost tax revenue and social security contributions, not including the education costs already incurred. By the time of her emigration, society has already invested approximately €436,000 in this doctor's training.

Since 2003, a net total of approximately 180,000 skilled workers have emigrated to other industrialized nations. The cumulative fiscal costs are likely to amount to billions of euros. At the same time, according to the Federal Employment Agency, the German labor market faces a skilled worker shortage of up to seven million people by 2035. The German Economic Institute (IW) estimates the lost production capacity due to the current skilled worker shortage at 49 billion euros for 2024 and forecasts a figure of 74 billion euros for 2027.

High-tax country in international competition

A key driver of emigration – both of individuals and companies – is the tax burden. With a standardized tax rate exceeding 30 percent and a record tax-to-GDP ratio of almost 42 percent, Germany is and remains a high-tax country by international standards. Specifically, in 2024, the combined corporate tax rate in Germany was 29.93 percent. By comparison, Ireland levies 12.5 percent, and Hungary only 9 percent. The tax-to-GDP ratio in Germany in 2023 was approximately 38.1 percent – ​​significantly above the OECD average and considerably higher than in the USA at 25.6 percent or Ireland at 21.7 percent.

While many OECD countries have lowered their corporate taxes since 2008, the tax burden for German companies has remained virtually unchanged or even increased slightly due to higher trade tax rates. Gabriel Felbermayr, president of the Kiel Institute for the World Economy, has clearly articulated this connection: High taxes make many things possible, including good infrastructure, but they also make Germany unattractive to high earners. Conversely, the country becomes attractive to those migrants who work in the lower wage segment – ​​with structurally negative consequences for the composition of human capital.

In a country index compiled by the Foundation for Family Businesses, which compares the 21 most important industrialized nations, Germany ranks second to last in the tax sub-index. Eastern European countries occupy the top positions there. Germany also ranks second to last in the labor cost and productivity factor, due to high labor costs coupled with below-average productivity.

Bureaucracy as an economic obstacle

From a tax perspective, the diagnosis is clear, but the burden of bureaucracy is an equally serious factor. In the 2025 Chamber of Industry and Commerce (IHK) business barometer survey, 86 percent of the companies surveyed stated that bureaucracy and regulations had increased enormously compared to the 2021 federal election. Without exception, all location factors surveyed were rated worse than in the last survey four years prior. For 90 percent of the companies, the reliability of economic policy has deteriorated significantly. Reducing bureaucracy is the top priority among the reforms demanded by 95 percent of the companies surveyed.

A survey of companies commissioned by the Federation of German Industries (BDI) and conducted by the Allensbach Institute paints a dramatic picture: Around one-third of large industrial companies have already relocated their research and development departments abroad. The main reasons for this are costs (58 percent), less bureaucracy abroad (47 percent), and greater openness to innovation at foreign locations (34 percent). Two-thirds of the companies are convinced that foreign competitors have easier access to new ideas and technologies. 57 percent consider Germany less suitable, or even unsuitable, for their innovation activities.

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Companies vote with their feet

The exodus of companies is no longer a purely academic phenomenon; it is measurable in job losses and business closures. Between 2021 and 2023, approximately 1,300 companies with 50 or more employees partially or completely relocated business functions from Germany to other countries – this represents 2.2 percent of all German companies of this size. These relocations resulted in the loss of 71,100 jobs in Germany and the creation of only 20,300 new ones, representing a net loss of approximately 50,800 jobs.

A recent Deloitte study in cooperation with the Federation of German Industries (BDI) shows that almost one in five companies no longer produces in Germany (19 percent) – eight percentage points more than two years ago. This relocation also affects development (17 percent, up from 12 percent), research (13 percent, up from 10 percent), and final assembly (18 percent, up from 11 percent). Particularly worrying is the fact that 43 percent of companies plan to further relocate their production within the next two to three years, compared to 33 percent in a similar survey two years ago. The target countries are Europe (30 percent), the USA (26 percent), Asia (19 percent, excluding China), and China itself (16 percent).

The chronicle of individual cases is long and ranges from Volkswagen, which is relocating parts of its Golf production to Mexico and outsourcing development to China, to MAN Trucks, which is moving its body manufacturing to Krakow, ZF Friedrichshafen, which is transferring 4,500 jobs to Hungary, and BASF, which is outsourcing services from Berlin to India. This is not a coincidence, but rather the result of rationally acting companies reacting to changing location conditions.

Structural stagnation without a trend reversal

The economic context is sobering. The German economy has been stagnating for years. Industry has been effectively in recession since 2018 – industrial production is more than 15 percent below its peak. In the automotive sector, the decline compared to the peak is more than a quarter. Only marginal GDP growth of around 0.2 percent is forecast for 2025 – which would mark the sixth consecutive year of stagnation.

In the IMD World Competitiveness Ranking, Germany improved its position by five places to 19th in 2025, but this is still far from its best ranking of 6th in 2014. The country ranks 61st in real economic growth and 55th in foreign direct investment. Around one in three foreign companies considers Germany to be at the bottom of the EU rankings for grid expansion, and 43 percent rate its energy costs as the worst in the EU. The KPMG location index fell to its lowest level since the surveys began in 2017.

Unit labor costs have risen significantly more sharply since 2015 than the G7 average, which, combined with weak productivity growth, is leading to a gradual loss of industrial competitiveness. Germany's share of global economic output has almost halved since 1995.

Political chaos as a location risk

In addition to the structural economic problems, there is a political dimension. The collapse of the traffic light coalition, the failed election of the chancellor in the first round, and the subsequent simmering coalition dynamics between the CDU and SPD have significantly shaken confidence in the reliability of German economic policy. In polls, 73 percent of the population stated that they felt misled by Chancellor Merz, and only 44 percent consider him suitable. Carsten Roemheld, capital market strategist at Fidelity International, puts it succinctly: Markets abhor nothing more than uncertainty.

Economic uncertainty in Germany has been more prominently featured in the news since the start of the war in Ukraine than ever before. The federal government has laid the foundation for structural renewal with an investment package and a special fund for infrastructure; however, according to the German Institute for Economic Research (DIW), consistent measures are lacking: the proposed steps are insufficient and driven by special interests. A sustainable economic recovery requires deregulation, a modern legal framework, and investments in digital infrastructure and education.

The failure of the welcoming culture

It would be too simplistic to reduce emigration solely to taxes and bureaucracy. There is a cultural dimension that is often underestimated in public debate. A survey conducted by the Friedrich Ebert Foundation among highly qualified individuals who have emigrated shows that the lack of a welcoming culture is the most frequently cited reason for leaving – even more so than low pay. Foreign professionals report experiencing everyday racism, a lack of social integration, and the feeling of being treated as foreigners regardless of how long they have lived in the country.

At the same time, Germany has increased skilled worker immigration from non-EU countries by 77 percent since 2021. This success is real, but it is counteracted by a dropout rate that is also real: In June 2025, there was still a nationwide shortage of around 391,000 skilled workers, and more than one in three open positions could not be filled. The structural skilled worker problem has not been solved despite the increased immigration because emigration and inadequate integration are occurring simultaneously.

What it takes for people to want to stay

The question that must ultimately arise from all the data is not: How do we prevent emigration? But rather: What conditions must be created so that qualified people, whether German or immigrants, decide to stay?

The answer lies in analyzing the causes. First, substantial tax relief for businesses and high earners is needed. The German government plans to gradually reduce the corporate tax burden to around 25 percent – ​​this is a start, but it must be implemented quickly and consistently to ensure it doesn't remain merely on paper. Second, a genuine, measurable reduction in bureaucracy is essential. The Chambers of Industry and Commerce's demand for an annual law to reduce bureaucracy and an immediate moratorium on new regulations is not radical, but rational. Third, approval processes, especially for infrastructure projects and business start-ups, must be dramatically accelerated. In its country report on Germany 2025, the OECD explicitly recommends simplifying and harmonizing planning and approval procedures.

Fourth, Germany needs a genuine culture of welcome – not as a PR campaign, but as a lived social practice. The fact that a lack of social integration is more important than monetary factors in the decision to emigrate shows that the problem extends far beyond economic policy. Fifth, political stability and reliability are essential. Investments flow where there is planning certainty. The cyclical political crises of recent years – from the traffic light coalition to the budget crisis – undermine precisely this trust.

Location problem, not a communication problem

The 1975 Emigration Protection Act prohibits commercial advertising for emigration. It doesn't prevent anyone from leaving the country. It solves none of the problems that drive people to leave. It is, in a sense, the perfect symbol of a fundamental misunderstanding: the notion that systemic problems can be solved by banning communication.

The emigration of skilled workers, entrepreneurs, and high achievers from Germany is not a temporary phenomenon that will resolve itself with favorable economic conditions. It is the rational reaction of competent individuals to a system that penalizes their performance, wastes their time with bureaucracy, and drowns their ideas in labyrinthine approval processes. The fiscal damage amounts to billions. The damage to the country's innovative capacity, demographic vitality, and long-term competitive position is harder to quantify, but no less real.

Germany still possesses extraordinary strengths: excellent infrastructure in large parts of the country, strong institutions, high public safety, a robust education system, and a world-class research landscape. But strengths are eroded when structural weaknesses undermine them year after year. The country index of the Foundation for Family Businesses shows that Germany still leads in the sub-index of financing. This is a precarious position.

The message of the data is clear: the problem isn't the discussion about emigration. The problem lies in the reasons that drive people to leave. As long as these reasons aren't addressed seriously and with political courage, no law and no communication strategy will prevent Germany from continuing to lose its substance – quietly and without much fanfare.