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The DACH Bubble

LIVE from Unleash Paris - If you believe Europe is a major player in the HR tech landscape - we certainly do - then you need to pay special attention to Germany, Austria and Switzerland, a region where much of the continental growth is happening. To prove that point, Chad & Cheese had Wolfgang Brickwedde, Director of the Institute for Competitive Recruiting on the podcast while hanging out at UNLEASH in Paris. Based in Germany, "Wolfie" is uniquely positioned to give us a deep dive into this crucial region's role in recruitment globally, not just in Europe.


Intro: Hide your kids. Lock the doors. You're listening to HR's most dangerous podcast. Chad Sowash and Joel Cheeseman are here to punch the recruiting industry right where it hurts complete with breaking news, brash opinion, and loads of snark. Buckle up boys and girls. It's time for the Chad and Cheese podcast.

Joel Cheesman: Oh, yeah. What's up everybody? We are early morning unleash, unleash Paris, France.

Chad Sowash: Fucking crazy, man.

Joel Cheesman: First interview of our session, so it's gonna suck. No, it's gonna be great.

Chad Sowash: No, it's gonna be great. His name's Wolfgang. How can it suck, how can it suck?

Joel Cheesman: Wolfgang. Can we call you Wolfie?

Wolfgang Brickwedde: No, no. You cannot. Only my mother calls me Wolfie.

Joel Cheesman: I know that there are people who call you cheesy, but I wouldn't.

Wolfgang Brickwedde: Cheesy does it, Cheesy does it.

Chad Sowash: He likes cheesy.

Joel Cheesman: All right. So welcome Wolfgang Brickwedde. Hopefully I said that correctly. He's director at the Institute for Competitive Recruiting. Specifically an expert in recruiting in Europe within Germany, Switzerland, and Austria. So we're getting really meta on this one.

Chad Sowash: DACH region.

Wolfgang Brickwedde: DACH region. Yeah.

Chad Sowash: The DACH region.

Joel Cheesman: Yeah. We learned that. We learned something today.

Chad Sowash: We're here in Europe. I'm hoping that we're gonna learn something.

Joel Cheesman: Yeah. We've been doing a European show for a while. We should know the DACH region.

Chad Sowash: I mean, there's a bunch of Countries.

Joel Cheesman: I blame leaving.

Chad Sowash: I mean, they have these Benelux things, these DACH things, these kind of like groupings that happen.

Joel Cheesman: Yeah.

Chad Sowash: Why is that a thing, Wolfgang? Why are you guys all about clustering? Is it because those three countries are so much alike?

Wolfgang Brickwedde: It's mostly language.

Chad Sowash: Mostly language. Okay. That makes sense. Okay.

Wolfgang Brickwedde: Germany, Austria, it's the same, but Switzerland is 60% the same. So that's why we call it the DACH region.

Chad Sowash: Let's take a look at it from an economic standpoint. You speak the same language. How are the economies? Are they pretty much in line with each other? Do they feed off of... They've gotta feed off of Germany, do they not?

Wolfgang Brickwedde: Yes, they do, but for Germany, for example, the biggest export nation is the US. So it's not Austria or Switzerland, but France is pretty close, but Austria and Switzerland are rather small in terms of like 10% of the GDP in Germany. So it cannot be the biggest.

Joel Cheesman: So we've been hearing for a long time with the war in Ukraine, Germany's reliance on Russian oil. Winter is coming. Give us a sense of someone on the ground. Is recession coming? How bad is it in Germany? What can we expect from the rest of the world this winter?

Chad Sowash: And how's it gonna affect recruitment?

Joel Cheesman: Employment as well.

Chad Sowash: Yeah, employment.

Wolfgang Brickwedde: Yeah. That's a very paradox recession, I would say. We will have slight downs turn in their economy. They expect around 0.5 something for next year. But 75% of the companies are expecting to hiring more people. So it's really... It's never been in a recession before. Usually you had high inflation layoffs and these kind of things, but not now.

Chad Sowash: So job creation's continuing, or at least that's what we're seeing.

Joel Cheesman: Will that be all sectors?

Wolfgang Brickwedde: Not all sectors. Some sectors. Of course, if they are highly intensive, then they're cutting down, but lots of other sector. You see it in each and every company in the window they look for people.

Joel Cheesman: So frontline workers, technologists, healthcare, all of those are gonna be full steam ahead.

Wolfgang Brickwedde: We have search and recruiters. Like for 93% more recruiters, search for the job ads. It's really amazing.

Joel Cheesman: And how has the globalization of recruitment impacted Germany? I know in the US people are moving all around the country. It doesn't matter if you're in Silicon Valley or Boston, Massachusetts. How is that impacting Germany? And maybe part of that as well, how is the influx of Ukrainian workers impacting Germany in parts that you're covering?

Wolfgang Brickwedde: First of all, the Germans don't move as much as the Americans do.

Chad Sowash: As as everybody else. Yeah, yeah.

Wolfgang Brickwedde: It's quite the opposite. The willingness to move for a new employer is going down. So the people like to go buy bike or whatever, very short-term to their new employers. So the mobility is going down. On the other hand, with the globalization remote work, the talent pool is expanding. So companies come to the idea that they can hire people or hire people in other countries. Yes. We have just had like deal our globalization partners. Like these kind of companies, they're coming into the country and tell them, "Yeah, you can hire people in other countries and we deal for you, we deal for you." So that's coming, but not in all the companies. Lots of companies, you have to speak German. English wouldn't be enough. So especially in SME area and the Ukrainians are not allowed currently to work.

Joel Cheesman: Ukrainians are not allowed to work in Germany.

Chad Sowash: Wow. Well, that's shitty.

Wolfgang Brickwedde: Sometimes they are, but most of they are not. So it would help a lot more, but you have then to look into the education, is it equivalent to the German one? And then they can work. So it's not that easy.

Joel Cheesman: Now can you hire a Ukrainian remotely?

Wolfgang Brickwedde: Yes, sure.

Joel Cheesman: But not if they're in country.

Wolfgang Brickwedde: Not in the in country.

Chad Sowash: Wow.

Joel Cheesman: That doesn't seem backward at all. [laughter]

Chad Sowash: God.

Joel Cheesman: Oh, Europe.

Chad Sowash: The German employment bubble.

Wolfgang Brickwedde: And we still have 2 million unemployed people. And it comes from this side. And so first if you should hire a German one, like in all countries first hire their own people, and then you are allowed to hire from other countries.

Chad Sowash: Germany first.

Joel Cheesman: Germany first. That's right.

Wolfgang Brickwedde: Yeah. Germany employees first. Yeah.

Joel Cheesman: And I assume Austria, Switzerland has the same rules.

Wolfgang Brickwedde: It's the same rules. In Netherlands, it's quite interesting. They have more open positions than they have people to look for Jobs.

Chad Sowash: So if that's the case...

Wolfgang Brickwedde: That's the case.

Joel Cheesman: Immigration.

Chad Sowash: Yeah. What's the whole deal with regard to 2 million who aren't working? Are they just not in the labor force?

Wolfgang Brickwedde: They're not yet in the labor force. They have been say unemployed.

Chad Sowash: Well, I mean, are they unemployed, but they're still available?

Wolfgang Brickwedde: They're available. Yeah, yeah. They're available. They're looking for Jobs.

Chad Sowash: Some individuals actually drop out of the labor force, right?

Wolfgang Brickwedde: Okay. No, they are still looking for jobs.

Chad Sowash: So is reskilling and upskilling a a huge... Germany does that well, right?

Wolfgang Brickwedde: That's what they do in the official agency then. For a federal official agency for labor, that's what they do. That's their business to reskill people, but also in the companies themselves in terms of the new challenges, they need to upskill the people. That's a big deal currently. How can we upskill our own people so we don't have to hire new ones?

Chad Sowash: Yeah.

Joel Cheesman: We're also hearing that Germany's gonna be committing more money to the defense of the country. How is that impacting jobs? More soldier jobs, more jobs around defense?

Wolfgang Brickwedde: No soldiers. [chuckle] Not that I have...

Joel Cheesman: No bots.

Wolfgang Brickwedde: No. But material, so some companies are getting more money, but it doesn't have to be only German material. It can be somewhere else. So they buy even US fighters.

Chad Sowash: So defense, technology, weapons, those types of things. Okay.

Joel Cheesman: She'll be buying, but not necessarily having more bodies employed around defense.

Wolfgang Brickwedde: Currently not.

Chad Sowash: The puns are 2.0. It's coming.

Joel Cheesman: You had to go there, didn't you?

Chad Sowash: What?

Joel Cheesman: You had to go back.

Chad Sowash: That's a great tank. It's a hell of a tank.

Joel Cheesman: Yeah, that's true. All right. Let's get off the military 'cause this is gonna go...

Chad Sowash: Okay, sorry.

Joel Cheesman: Let's go back.

Chad Sowash: Okay, okay.

Joel Cheesman: What other trends are you seeing? You're here at the show. What are you hoping to learn? Find out more about what's hot.

Wolfgang Brickwedde: Yeah, that's my reason why I'm here. I like to see future trends, and I see the first one is that we need to empower the companies and the employers to deal with uncertainty, a lot more than before. Like in plan, if they had one, we need to hire 100 people next year. So in former times, it worked and they hired against the plan, but in the future, we have a recession, might be a slowdown in hiring.

Chad Sowash: So contingencies, they need to start having contingency plans. Is that what I'm hearing?

Wolfgang Brickwedde: Contingency plans and to a brace with the business, to be able to brace with the business. And they are not employed for this. So that sets needs to change and it could be RPOs, it could be any contingent work, a tip that would help, but they need... The mindset need to change, because in two years time, we need all the people back. And that's something that they need to deal with.

Joel Cheesman: Are you bearish or bullish over the next 12 to 24 months? Do you feel good about the future or...

Wolfgang Brickwedde: Two years time, yes, but the next two years will be bearish.

Joel Cheesman: Burn down the hatches. It's gonna be rough. You heard it here first, Chad.

Chad Sowash: We give the scoop from doc.

Joel Cheesman: From unleash, everybody give a big round of applause. We have no audience, so I don't know who's applauding. Wolfgang Brickwedde, if they wanna know more about you or your organization, where would you send them?

Wolfgang Brickwedde: LinkedIn.

Chad Sowash: LinkedIn.

Joel Cheesman: LinkedIn.

Wolfgang Brickwedde: Otherwise would do it as well.

Chad Sowash: Okay.

Joel Cheesman: And with that, another one in the can. We out.

Chad Sowash: We out.

Wolfgang Brickwedde: Wow. Look at you. You made it through an entire episode of the Chad and Cheese podcast or maybe you cheated and fast forwarded to the end. Either way, there's no doubt you wish you had that time back. Valuable time you could have used to buy a nutritious meal at Taco Bell, enjoy a pour of your favorite whiskey or just watch big booty Latinas send bug fights on TikTok. No, you hung out with these two chuckle heads instead. Now, go take a shower and wash off all the guilt, but save some soap because you'll be back. Like an awful train wreck, you can't look away, and like Chad's favorite Western, you can't quit them either. We out.


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