Demographic change: the twofold challenge facing public administration

1.5 million employees will leave the public service on age grounds by 2030. Hardly any public authority has a plan B for that.

Demographic change is hitting public administration on two fronts at once. On one side, more than 1.5 million employees will leave on age grounds by 2030, which corresponds to around a third of the entire workforce in the public service. On the other, current analyses show that the sector will be short of at least one million skilled staff by that same year. The two developments reinforce each other and add up to a staffing gap that conventional recruitment alone can barely close.

The scale of this is still underestimated at many senior levels. A third of the workforce does not depart suddenly on a single date, but over a period of a few years in which whole departments lose their most experienced people, while new digitalisation projects, rising case numbers and more complex legal bases make everyday work denser. Anyone who dismisses this development as a purely staffing matter fails to see that it directly affects the strategic capacity of the entire authority.

Why knowledge disappears before successors arrive

The real danger does not lie in the sheer headcount of departures. It lies in the knowledge that leaves the authority with every retirement. Experienced caseworkers often know an administration’s informal procedures, its exceptional cases and its historically grown special rules better than any organisational manual. When these people go without their knowledge having been passed on systematically, the authority loses capacity in places that never stood out before, because a single person quietly closed the gap.

In practice this effect often only shows months after the actual farewell. A procedure that ran smoothly for years suddenly stalls, because nobody knows any more which department is responsible for a particular exception, or which contact in a neighbouring authority is the right one for a special case. This kind of knowledge appears in no organisation chart, and it cannot be compressed into a single handover conversation either.

Many administrations respond to this situation with job advertisements and hope to offset the loss through the external labour market. Given the skills shortage growing in parallel across the entire public sector, that is a bet on a market moving in precisely the opposite direction. Anyone relying solely on new appointments is competing with thousands of other authorities for the same scarce candidates, and often has to accept long vacancies while the remaining workforce absorbs the extra work.

Citizens’ expectations grow alongside the staffing gap

The situation is made worse by rising expectations of the administration itself. A representative survey from 2024 shows that nine out of ten citizens want more determination in the digitalisation of their town or municipal administration. At the same time, only two per cent of the medium-sized companies surveyed consider German public administration to be highly capable, while more than sixty per cent rate it as less capable or barely capable. This gulf between aspiration and reality does not arise from a lack of will among staff, but from structures designed for a different era and a different level of staffing.

Public confidence in the state’s ability to act reflects the same development. Surveys from the same period show that only about a quarter of respondents are convinced the state can perform its tasks reliably. That perception usually grows out of concrete experience with long processing times and overstretched offices, in other words precisely the symptoms that demographic change will foreseeably intensify unless administrations take countermeasures.

An administration that is expected to lose staff, build new digital services and maintain its core tasks all at the same time needs a form of prioritisation that goes beyond routine administrative practice. Anyone who tries to reach all three goals with the existing processes puts additional strain on the remaining workforce and thereby indirectly accelerates further turnover, because committed employees under constant pressure start to consider moving on themselves.

Systematic knowledge retention instead of one-off handovers

The first effective lever lies in securing experiential knowledge systematically, before the person concerned leaves the authority. In concrete terms that means handover periods of several months instead of a few weeks, documented process descriptions for tasks that so far existed only in one person’s head, and deliberate pairings of experienced and new employees. Such pairings work best when they start early enough and give both sides real room to ask questions and work through special cases together, instead of squeezing them into a short checklist.

In my book Verwaltungsmodernisierung mit Methode (Administrative modernisation with method) I describe how such knowledge transfers can be embedded in a structured analytical model that starts before the actual process optimisation and thereby prevents reform measures from running into the void at exactly those points where the decisive knowledge has already been lost. An authority that first understands how a process actually works can then optimise it more precisely than an authority that hastily introduces new procedures without knowing the established practice behind them.

Prioritisation instead of the watering-can approach

The second lever is an honest prioritisation of the tasks themselves. Not every service an administration provides today has to continue at the same quality and speed as before. Senior managers who understand demographic change as a strategic task sort tasks by how critical they really are and thereby create room for the areas that genuinely matter. That takes the courage to prioritise in front of politicians and the public, but it is considerably more realistic than trying to absorb the loss of staff through greater work intensity alone.

Digitalisation can help here, but it does not replace prioritisation. A digitalised process that is essentially superfluous remains a superfluous process, merely carried out faster. Digitalisation only becomes effective where it meets structures that have already been cleared up and prioritised. It is precisely this sequence, first understand and prioritise, then digitalise, that marks the difference between projects that genuinely bring relief and projects that create additional complexity.

The time to act is now

The figures on demographic change have been known for years, yet many administrations only act once individual departments are already acutely understaffed. Those who begin now to secure knowledge systematically and to prioritise tasks honestly gain a lead of several years over administrations that only react once the gap has opened. Demographic change cannot be halted. How an authority answers it organisationally decides its capacity to act over the next ten years.