BERLIN -- It is a mark of the deep disorder of Germany's labor market that even as the country struggles with mass unemployment, it also faces a serious shortage of workers in numerous sectors.

Like the unemployment problem, the lack of workers poses a threat to the already-sluggish German economy. And like the high unemployment, the labor shortage results to a large degree from policy shortcomings and failures.

As a result of this and a related debate about the sensitive issue of immigration, the worker shortage question is likely to play a notable role in this year's general election campaign.

"The worker-shortage problem reflects deficiencies in the country's education, training and job-incentive systems as well as insufficient regional mobility by unemployed people," said Bernhard Schwarzkopf, labor market expert at the Confederation of German Employers' Associations.

"We don't emphasize basic skills and continuing education enough and labor mobility is restricted in certain regions," Schwarzkopf added.

Germany, where the number of unemployed people is nearly 4 million, has about 1.2 million unfilled jobs. These unfilled positions are in sectors across the board, but they are especially numerous in the information technology, metals and hotel-restaurant industries.

The all-important German machinery and plant industry, which normally hires between 6,000 and 8,000 engineers a year, has about 10,000 unfilled engineering jobs, according to industry association VDMA.

"Growth will be restricted because of the lack of engineers in Germany," Eberhard Reuther, then president of VDMA, warned last year. "A time bomb is ticking here that could soon go off if determined countermeasures aren't taken."

Fundamental Education, Welfare Policy Reforms Needed

VDMA has appealed for a higher retirement age, a greater share of women in the workforce, more intensive training for older workers or more foreign workers.

The need for foreign workers, particularly high-skilled ones, prompted the Social Democratic-led government in 2000 to invite up to 20,000 information technology experts from abroad to work in the country.

That initiative ignited a divisive debate about the desirable degree of immigration in Germany - a debate that was re-ignited this year by a much-publicized study indicating German school standards had declined sharply.

Bavarian State Governor Edmund Stoiber, the chancellor candidate of the main opposition Christian Democrats, linked the study's results to inadequate proficiency in the German language by many immigrants.

In any case, the worker-shortage issue will also require fundamental changes in social-welfare policy, including unemployment benefits, according to observers.

Proof of this was offered by a recent VDMA campaign to recruit engineers in the Hamburg area.

The association got in touch with local unemployment offices in an effort to lure unemployed workers with engineering skills back to work.

One of the enticements was an offer to establish computer links between homes and schools so that workers could take part in retraining classes from home.

But although about 1,500 workers were initially identified, only 150 showed up for a "kickoff" meeting and only two ended up taking jobs.

Reuther attributed the disappointing result partly to generous jobless benefits that made many people unwilling to return to work.

"There was a psychological block" against taking work, he said.

In Germany, 6.5% of gross wages are used for unemployment-related measures. These contributions, divided evenly between employers and employees, total about EUR46 billion a year - or roughly 20% of the total federal government budget.

Some 50% of these contributions goes to jobless benefits, 40% to labor-market policies - including job promotion programs - and 10% to administration.

In addition to calling for an education and training offensive, the Confederation of German Employers' Associations has urged the government to lower unemployment-related contributions.

It has said that this would not only increase investment and job creation by businesses but also help to make work more attractive by increasing net pay levels.

The confederation also claims that fewer unemployment contributions would improve the effectiveness of labor-market policies themselves.

As Germany's election campaign gets into full swing, a key underlying question is whether either Stoiber or Chancellor Gerhard Schroeder has the political courage to enact such reforms.