Cross-border economic area
The new study, ‘Labor Market on the Upper Rhine’, sees Baden and the Palatinate ahead of Northwest Switzerland in terms of employment growth since 2010.
The labor market situation in the southern Upper and Western Upper Rhine requires greater cross-border cooperation, less competition and more flexibility on the part of the worker. Those responsible for Regio Basiliensis draw these conclusions from the new edition of the Upper Rhine labor market report, which was prepared by the research institute BAK Economics in Basel on behalf of the organization coordinating cross-border cooperation between the northwestern cantons of Switzerland.
The third edition of the report illustrates the close ties of the trinational region. However, it also shows the declining potential of the workforce, despite continued population growth of 0.5 percent per year. Based on the entire region between Aarau and Waldshut-Tiengen in the east, Solothurn in the south, Alsace, southern and central Baden and Landau in the southern Palatinate, approximately 30,000 people per year, with the five cantons around Basel growing relatively dynamically than the other sub-areas. Nevertheless, according to the report, the workforce potential of people aged 15 to 64 will decline on average by 0.1 percent per year until 2035, with BAK’s contraction expected to be more pronounced in Baden and Palatinate, according to the BAK.
A large number of vacancies
From the Regio Basiliensis point of view, however, there is a need to work one way or the other. The report shows that the gap between job potential and demand is growing, for example in the number of vacancies: in 2021, despite the effects of the pandemic, this was in the labor market regions of Lrrach, Freiburg and Karlsruhe with 7,310 vacancies, as well as in northwestern Switzerland by 9599 higher than in 2020. From the BAK’s point of view, the shortage of skilled workers is now “significant” in both Northwest Switzerland and Baden.
The city of Friborg and its surroundings and Landau in the Palatinate remain the driving forces behind the growth in the German part of the trinational region. Employment has grown almost continuously over the past ten years in both regions. The main drivers of growth in northwestern Switzerland are the Canton of Basel-Stadt with its life science cluster (pharmaceutical, chemical and biotechnology companies) and Aargau. In addition to the chemical and pharmaceutical industries, BAK has registered a relatively above-average number of employees in the electronics and healthcare sectors. The study identifies these three industries as “regionally focused industries”.
Healthcare sector with high employment growth
The largest increase in employment in 2010-2020 compared to the entire region took place in the health sector, ahead of information and communication technologies (ICT) and knowledge-intensive services. There are, however, regional differences. In the German sub-area, mechanical engineering is ahead of health and electronics in terms of employment growth. Overall, the German sub-area has experienced an average annual increase in employment of more than one percent over the past decade. It was therefore above the average for the entire tri-national region of 0.77 percent and saw employment growth in almost all sectors. On the other hand, in northwestern Switzerland, some of them have shrunk, not only in the catering industry, but employment growth in the leading pharmaceutical industry has also been below average. In Alsace, employment has even dropped significantly in some cases – not least in traditional industrial sectors such as automotive and mechanical engineering.
Basel has a high per capita income
The report also finds growing regional disparities beyond employment. On the one hand, it concerns the wealth gap between urban and rural areas. On the other hand, this also applies to the per capita income of the three national sub-areas. The bottom line is that BAK classifies a region with around 6.1 million inhabitants and an average gross domestic product (GDP) of € 47,400 (2020) per capita as ‘prosperous’. However, this value is not only due to the high per capita income in the Swiss cantons. Basel-Stadt in particular has an average GDP of € 188,000. This figure is illustrated by the high proportion of cross-border commuters who spend most of their income in southern Baden or Alsace, and the restriction to a densely populated urban area. This value also emphasizes once again the city’s role as the most dynamic business location in the entire region.