March 29, 2019

Volkswagen: Supporting Refugee Employment and SMEs

In German, Volkswagen stands for “car of the people”. In the city of Wolfsburg, where the company has its headquarters, this couldn’t be more true: Volkswagen has become the center of the city’s economic life – most companies and businesses, from family-owned automotive component suppliers to the farms producing meat for the “Volkswagen currywurst”, are in some way connected to Volkswagen. So, when these small and medium size companies (SMEs) were faced with daunting skill gaps, and the city’s refugee population was struggling to find employment, Volkswagen was motivated to step-in. In 2016, the company started a collaboration with the Chamber of Commerce and Wolfburg’s Federal Employment Agency, which provides job training and placements in Germany, to begin connecting unemployed refugees with companies in Wolfsburg who are searching for new employees and offering apprenticeship positions.

The core of Volkswagen’s refugee assistance programs focus on helping to train refugees in language and skills so they can compete in the German job market. The goal for all of Volkswagen’s refugee programs is to prepare refugees to enter the workforce through traditional pathways, rather than through specialized programs. While there was excitement on behalf of companies to hire refugees immediately, most had to take a step back and strategize how to adapt their current national training programs to be inclusive of refugees. From the beginning, it was clear that Federal language classes were not enough – speaking in class for 2 to 3 hours, then returning home to a non-German speaking environment meant that most of what refugees were learning in class was quickly forgotten. In addition, the sudden influx of refugees in 2015 overwhelmed the system, and the government struggled to respond quickly. So Volkswagen took a leading role. “We started to support the government where they needed help – we financed language classes because there were not enough state teachers and language proficiency is one of the main pre-requisite requirements for those applying to work or study in a German university. Waiting around for over six months with nothing to do, especially after coming from trauma backgrounds, is especially difficult for the refugees, so we thought we could intervene there first” explained Ms. Krautz, a member of the Corporate Social Responsibility team at VW.  Importantly, VW recognized the importance to integrate language with work training, so Volkswagen supported the development of language classes, and pre-qualification workshops, to help prospective refugee employees “catch-up” with locals. Focused especially on current students and young adults, the programs developed helped refugees prepare for the traineeship programs that are mandatory to complete to enter certain professions in Germany. To date, over 2,600 refugees have received direct classes from VW.

Ms. Krautz explained that small and medium enterprises (SMEs), both in Volkswagen’s value chain and externally, cannot find enough employees to hire and would particularly benefit from hiring refugees, as opposed to larger companies which can often find and attract employees to come to Germany from abroad. “Finding good people is good for our business, so we looked where those gaps were, where people were most needed, and started to train them to access jobs, even outside of the Wolfswagen Group” stated Ms. Krautz. So they first started to enable refugees to work in small and medium enterprises (SMEs) in their supply chains by empowering them with the skill sets needed, as well as providing them with financial assistance to complete the qualifications necessary for the job, which typically, smaller companies cannot afford to finance alone.

Considering the impact of Volkswagen on the city of Wolfsburg, and how its supply chain is closely connected to the well-being of the city itself, addressing SME skill gaps locally could help Volkswagen close the labour gaps in its supply chain in the long-term.  While the core of the company’s efforts lay in filling employment gaps within Wolfsburg, it is involved in refugee assistance and skills training throughout its entire supply chain.

Important city stakeholder

Beyond assisting refugees with direct employment services, Volkswagen recognized the important role it could play at the city level, assisting with other aspects of refugee settlement. This initial engagement took shape in a program called Refugee Aid, which offered Volkswagen employees opportunities to volunteer to address specific refugee needs in the community, with the added benefit of creating an employee engagement program that strengthened the companies’ ties to the community. The most pressing concern was managing the administration of the large influx of refugees to camps and assistance centres. Through employee participation, Volkswagen provided software engineers to development and implement IT systems to support efficient registration and tracking of refugees. With this information, Volkswagen volunteers developed programs to address the populations concerns, including helping to translate CVs into the German labour market context and mentoring refugee youth interested in attending German universities.

Beyond leveraging its own employee base, Volkswagen found many ways to utilize its resources to support refugees. In the summer of 2016, the refugee camp close to company headquarters had received over 1,000 refugees but did not yet have a functional kitchen. So, Volkswagen responded by providing cooked meals for over 1,000 people during the 4 days the kitchen was under construction. Through partnering with local NGOs already engaged in supporting the refugee community, VW was able to support refugees through its inventory: it leant company cars out to support refugees in traveling to doctor’s appointments, to receive their asylum papers, and transporting materials and supplies. Through partnering directly with NGOs, and understanding the most immediate needs, Volkswagen could respond quickly and use resources the company had readily available.

Through its commitment to supporting refugees in the community, Volkswagen recognized the need to invest specifically in refugee youth, given Germany’s rigid education structure, divided into 3 “levels” based on student performance, which often negatively affects migrant and refugee children, who have a difficult time adapting to the system. The level of which the student can progress determines if they can apply for university degrees, so it is especially important for newcomers to be coached and potentially assisted throughout the process. The union at VW has a foundation that initiated a 2.5-Million-Euro program in 2015 in Wolfsburg for school-age refugee children offering additional teachers to the government to supplement the lack of personnel due to the sudden influx of school-age children in the public-school system. They also provided social workers to monitor when refugee children have episodes of trauma and assist them throughout the healing process.

Advice to other companies

By directly providing the training and connections to SMEs in their supply chains, large companies can adopt the VW model of refugee assistance involvement without hiring refugees directly. This model is particularly replicable in companies operating in multiple countries as they control their supply chains directly and can demonstrate the greater impact of their involvement.

  • Capitalize on your core functions. Identify your company’s competitive edge, and meet with the human resources, research and development, and corporate social responsibility departments (if applicable); consider how the different departments can build a comprehensive refugee assistance program, and how to best foster employee engagement.
  • Fill employment gaps. If your company is not in a position to hire directly, review your supply chain, and identify if there are any gaps in their employment needs. If you don’t have specific gaps in your supply chains, partner with local SMEs, chambers of commerce and entrepreneur organizations to see whether they have employment needs, or could use support. Try to adapt your competitive edge and company skill sets to the training needs of these organizations when building your refugee program.
  • Training youth. Be open to assisting the young, especially if you’re a larger company. While they will most likely not be able to work for your company immediately, providing additional assistance for refugee children in school districts where your company operates can help identify candidates in the long run and build a sustainable and qualified workforce for your supply chain over generations. Positive spillover effects include building lifelong loyalty to your firm, as they will be familiar with your brand, and become customers in the future.

Content for this article originally appeared in, “Company Interventions for Refugee Employment in Germany”, prepared by Lina Zdruli, M.A. Georgetown University

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