Munich-based startups, scaleups, and grownups employ over 96,000 people worldwide. This is the result of the first study published by Munich Startup and Dealroom. “Munich Startup Employment”Report. According to the report, the companies will create 38,700 jobs in the greater Munich area, another 14,300 in the rest of Germany, and 43,000 jobs worldwide.
The report examines not only recently founded startups but all companies in Munich's innovation ecosystem that have been established since 1990 with the goal of rapid growth. The study is thus based on the startup definition of Paul Graham, co-founder of Y Combinator. However, the companies are divided into several cohorts based on their age. It shows that 80 percent of all job-creating companies were founded after 2009, and together they provide around 23,000 jobs. Around half of these jobs are concentrated in a few sectors such as transportation, healthcare, and enterprise software.
The impact of VC capital on job creation
At first glance, the finding that better-funded startups can offer more positions seems unsurprising. Last year, startups that raised between €4 million and €15 million had an average of 32 employees, while startups with less funding (€1 million to €4 million) had 17. Nevertheless, companies with VC funding do not dominate the job market. 54 percent of all jobs come from startups without funding – which, however, is due to the fact that only around a third of all Munich startups have investors behind them.
Startups and the shortage of skilled workers
The shortage of skilled workers hasn't spared Munich startups either. Last year, around a quarter of all open positions were advertised in tech-intensive areas. But the business development sector is also struggling to find suitable employees.
Andreea Chirilov, Talent Acquisition Team Lead Konux, says:
"The biggest challenge is finding the right balance when hiring for the engineering department. Software and DevOps developers are in high demand. There's a limited pool of experienced developers, intense competition for talent, and high salaries. This is especially challenging because we're looking for top-notch employees who combine software with cloud computing experience, who can bring new ideas, embrace challenges, and think outside the box."
Munich’s universities naturally play an important role in this. They are not only hotbeds for startups, but also offer companies access to potential new employees – including those from abroad, such as Jerome Geyer-Klingenberg, Head of Academic Alliance Celonis, explained:
"A significant proportion of our employees in Munich have roots abroad. Many of them came to Celonis through studies at one of Munich's universities."
And further:
"Celonis cooperates with around 700 educational institutions (especially universities) worldwide through its Academic Alliance. We also offer numerous student trainee positions: In Munich alone, around 200 Celonis employees have a TUM background, including many former student trainees who were subsequently hired."
The complete “Munich Startup Employment” report can be here can be downloaded.
