In two German states, both in the former communist eastern part of Germany, the far-right AfD (Alternative for Germany) party won historic amounts of votes in recent state elections.

In Thuringia, the AfD is now the largest party after it got 33 per cent of all votes, well ahead of the second biggest party (24 per cent for the Christian Conservative CDU). Many Germans and Europeans are in shock about this result.

This is the largest electoral success for a German far right political party since the Nazi era. The AfD deliberately plays with Nazi iconography and references. They have countless neo-Nazis in their ranks.  The AfD in Thuringia is headed by its most controversial figure, Bjoern Hoecke.

All major parties declared their unwillingness to build a coalition government with the AfD. The only coalitions possible then are almost comical. The centre-right Christian Conservatives (CDU) would be in a coalition with a hodgepodge of very left parties.

Hardly a recipe for political stability.

Let’s examine Thuringia through the demographic lens. Believe it or not, there might be a few lessons for Australians.

What’s going on in Thuringia?

Since German reunification in 1990, demographic indicators haven’t been kind to Thuringia.

Even before the collapse of the Berlin Wall the state didn’t grow, but its population has been dropping since 1990 (from 2.7 million to 2.1 million).

The most educated and driven former East Germans were in high demand in the employment centres in the West. Women in Thuringia outperformed men in education and were more likely to leave for the employment centres in the West.

Today, in Thuringia among 20 to 40-year-olds (roughly the partnering stage of the lifecycle), men outnumber women by 12 per cent. The odds for men in Thuringia of finding a partner are even worse considering that the remaining women on average are still more educated than the men.

One hangover from the old days when women were locked out of the workforce is referred to by sociologists as the upwards social mobility of women. In olden days, the only way for a woman to climb up the social ladder was to marry up.

Today online dating platforms provide us with clear data that show women still prefer their partner to be more educated than them, and to have a higher income earning potential. The young single men in Thuringia find it hard to find a partner.

Young disadvantaged men without a partner are easily drawn to political extremes.

Who is to blame for your misfortunes?

Migrants are a perfect and unfair scapegoat. Facts don’t matter much here since the share of the population that are migrants in Thuringia is a mere 8 per cent (about half of the German average of 15 per cent and orders of magnitude below the 30 per cent in Australia).

There is simply no reason for migrants to favour Thuringia over other German states. Fear over facts.

The reason things in Thuringia have worsened are economic. There is no reason for jobs and businesses to settle at scale. The biggest loss of employment opportunities was in the manufacturing sector. Thuringia’s 400,000 manufacturing jobs in 1990 fell by half by 1994 and never recovered.

The local factories simply weren’t up to date. It made no sense to manufacture stuff in Thuringia. The state is also home to the Fulda Gap, a crucial military crossing point. Strategic infrastructure and manufacturing capacity better stay away from Thuringia – just in case.

The growth opportunity for knowledge jobs is also limited since the largest cities in the state are tiny (Erfurt 210,000, Jena 110,000, and Gera 93,000). Start-ups are better off settling near deeper labour pools in larger cities.

These trends transformed the age profile of Thuringia. The cohort of retirement age (65+) grew by 61 per cent while the working age population (18-64) declined by 29 per cent. The number of kids (0-17) fell by a massive 46 per cent. This age profile tells a story of permanent demographic decline. Look at the big pile of people in their 60s right now.

In 20 years, they will all need care. Already they drive demand for more medical services each year and local doctors are nowhere to be found. The aged care crisis will be spectacular.

The chart below compares the age profile of Thuringia with Australia (surely this chart is a world first). Have a read of my previous column about how Australia will struggle to service its ageing population, then look at the chart again.

Thuringia stands no chance of coping with its ageing population.  The costs will go through the roof. Considering the poor state of the economy in Thuringia, it’s guaranteed that richer states will be forced to subsidise Thuringia forever. That will lead to further political rhetoric in the former West German states against the former East German states. A recipe for a worsening of social cohesion in Germany.

If I was a far-right party, I would’ve focussed my efforts on Thuringia too. It makes perfect sense strategically.

What could change Thuringia fortunes?

Thuringia would need to offer employment opportunities, education, affordable housing, and medical services while being a welcoming society that embraces foreigners with open arms.

Job growth outside of aged care is hard to imagine at scale; a few great but small universities exist that could with gigantic financial efforts be leveraged; housing is cheap but not necessarily affordable since wages are low (the state also features one of the lowest rates of social housing in Germany); a doctor shortage already exists and is guaranteed to get worse as the state ages.

Jobs in the service sector will increase but not at scale since other regions in Germany are more competitive. Manufacturing will probably continue to decline in Thuringia since the whole sector suffers from elevated energy costs in Germany.

Further, other German states feature more advanced manufacturing ecosystems and cheaper manufacturing goes to Poland and Czechia. With some serious investment agriculture, maybe even some value-added food manufacturing, might be an option in Thuringia.

Such investments would only eventuate if global capital isn’t offered more attractive investment opportunities elsewhere.
Since the German labour pool shrinks rapidly, Thuringia would need to become much more welcoming to foreigners to drive any jobs sector. The big successes of the AfD achieves the exact opposite.

That’s a great thing for the AfD since they benefit from economic decline. Betting on a party that benefits from economic misfortune is a comically dumb idea. Foreigners will continue to avoid Thuringia.

Considering how dire the situation in Thuringia is, I would consider a few risky economic experiments. What about a free trade zone? Zero business tax for tech-startups! Visas specifically for Thuringia.

This would unfortunately need to be accompanied by bigger police spending to protect the newly settled migrants and to ease the concerns of the AfD electorate. As for any struggling region, tourism might also be an option for Thuringia. This would overwhelmingly be aimed at German tourists but the success of the AfD overall hurts this sentiment. Germany suffers poor demographics and a difficult economic future. The time would be right to try bold new things. Thuringia would be a good testing ground since there is precious little to be lost if such projects failed.

To be fair, I don’t see the fortunes of Thuringia looking up any time soon. I expect the political spectrum to shift further to the right and socio-economic indicators to go down.

What are the lessons for Australia?

While Thuringia as a former communist state can’t directly be compared with any region in Australia, we can still learn general lessons.

Demographics matter and softening of the ageing of the population through migration has economic benefits.

Ageing and economically disadvantaged areas must urgently reinvent themselves to avoid becoming islands of despair. Political radicalisation further intensifies existing problems.

In politics, boring is good.

In Australia, once your state or city loses young high school graduates you must urgently start to counter this trend as much as possible.

Demographer Simon Kuestenmacher is a co-founder of The Demographics Group. His columns, media commentary and public speaking focus on current socio-demographic trends and how these impact Australia. His podcast, Demographics Decoded, explores the world through the demographic lens. Follow Simon on Twitter (X), Facebook, LinkedIn for daily data insights in short format.