The German government has signed off on a plan to recruit non-EU workers to fill shortages of skilled labour after business leaders and politicians warned about serious risks to the country’s economy due to a lack of qualified personnel.

During a summit held in Berlin’s Chancellery, companies and Union officials signed a memorandum that simplifies the procedures to work in the country, by reducing bureaucracy and making Germany more attractive.

Germany’s labour market has the second-lowest unemployment record in the EU with 3.1% of the population out of work. The Czech Republic remains well ahead of the rest of the European pack, with a jobless rate of only 2%.

Long-term economic expansion has left German companies with 1.36 million vacancies amid soaring demand, according to the Data from the Institute for Employment Research.

“What is really important is that we are seen in third countries as a country that is open to the world and interested. Because we are not the only ones in the world who are looking for qualified labour,” said Chancellor Angela Merkel after the summit.

According to a survey by Germany’s chamber of commerce, 56% of local German companies say the biggest risk to their business derives from a lack of skilled labour.