The economic contribution of prisoner of war labour to Nazi Germany during WWII

The subject of foreign and forced labour exploitation by the Third Reich is not one of meagre proportions. More than 14 million forced labourers passed through the Reich from 1939 to 1945, of whom 4.6 million had been prisoners of war (POWs). Interestingly there is little work on the economic effect of POWs.

Some new work on this issue is discussed by Johann Custodis in an article at the VoxEU.org website on Exploiting the enemy: The economic contribution of prisoner of war labour to Nazi Germany during WWII

Custodis writes,

POWs were exploited through maximising employment, minimising payments, and the use of discrimination and abuse. My recent study complements the work of Herbert (1997) and Spörer (2001) on the employment of POWs in Nazi Germany (Custodis 2012). It provides more consistent employment data from a wide array of primary and secondary sources. Data from the German Ministry of Labour used by other authors is re-analysed for a first quantification of the POW’s economic contribution to Nazi Germany’s war economy. My results revise POW employment figures upwards and they also show that the exploitation of the POW workforce was more significant than previously thought.

Foreign and POW labour made up a significant proportion of the German workforce. At peak in September 1944, 7.5 million, or approximately one fifth of the aggregate German workforce, were foreign workers or POWs; in the munitions industry and in agriculture in 1944, at peak one third and one fifth were POWs or foreign workers respectively. The foreign workforce was largely transferred to Nazi Germany from occupied territories in Europe and contained a vast array of different groups, namely voluntary and coerced workers from Western Europe, forced labour from Eastern Europe, and concentration camp inmates.

The POW workforce itself was similarly heterogeneous. The initial POW workforce in 1939 consisted mostly of Polish POWs, but by 1942, the great majority was Soviet or French with peak employment of approximately one million respectively. The Italian armistice in September 1943 produced an additional labour source of half a million Italian POWs. They were reclassified as Italian Military Internees (IMIs) to circumvent the 1929 Geneva Convention which forbade POW employment which was excessive, dangerous or directly linked to the war effort.

Four main POW groups can be distinguished based on Germany’s adherence to the Geneva Convention. British and American POWs received treatment mostly complying with the Geneva Convention. French and Belgians could suffer from arduous conditions but on average were treated fairly well; Yugoslavs and IMIs only encountered partial compliance; Poles and Soviets possessed no legal protection whatsoever. Initially, most POWs worked in agriculture, but by 1944, they were increasingly employed in coal mining and the munitions industries. Also, the ideological discrimination largely determined work allocation. While for instance half of all French POWs worked in agriculture in 1944, three quarters of the Soviet POWs worked in industry.

There are rather obvious moral hazard problems with forced labour, productivity isn't likely to be high. Custodis continues,

No consistent work has so far been done on the field of POW productivity. Pfahlmann (1968: 233-234) claims that POWs on average were 80% as productive as German civilians, but he does not account for productivity varying by nationality and over time. Skilled French POWs in agriculture for instance were allegedly 80% to 90% as productive as German civilians (Spörer, 2001: 186), but by the end of 1943 their share in the POW workforce was declining rapidly as that of the Soviet POWs began to rise. The Soviets had died in masses until 1942 when Hitler began to tap them as a labour resource such that by January 1945 they represented almost half of the POW workforce. The relative Soviet POW productivity is contested but appears to have ranged from 45% to 60% of a German civilian (Spörer 2001:186; Streit 1978:215). I produce new productivity calculations accounting for these different productivity estimates and factoring in the changing workforce shares over time and the sharp productivity differences by nationality. My results illustrate that the POWs were not as productive as Pfahlmann had claimed. They were on average 50% to 70% as productive as German civilian workers and productivity decreased over time from 70% in 1942 to 55% in 1945. The decrease is mainly driven by the rising share of Soviet POWs with lower productivity figures, but also frequent reassignments, starvation, mistreatment, and bombings reduced productivity, in particular towards the end of the war.

As to the number of POWs employed Custodis revises previous employment figures substantially upwards.

Previous studies show two major deficiencies in this regard: First, they omitted existing government statistics and second they neglected POWs who had been counted as civilians. Herbert (1997: 298) claims that nominal peak POW employment in autumn 1944 stood at 1.91 million, but his individual statistics only add up to 1.73 million as he omits Yugoslav and British POW labourers. Also, statistics by Kroener, Mueller and Umbreit (1999: 212) show that the nominal peak occurred in fact in January 1945 with 2.2 million workers. However, the correction for the omission of ‘hidden’ POW workers shows that actual POW employment was significantly higher. Several hundred thousand French and Polish POWs and IMIs were ‘released’ into civilian status between 1942 and 1945 to increase output and productivity as civilian working conditions were not bound by the Geneva Convention. The civilian releases raise POW employment from 1.9 to 2.3 million POWs workers in autumn 1944 and from 2.2 million to a staggering 3 million in January 1945.

Putting the labour force and productivity measures together get an extimate of the economic contribution of POW's to the Nazi economy.

The POWs at peak made up 5% of the aggregate German workforce. The employment figures can be used to attain an output proxy by assuming that each POW worked a constant amount of days per year with more or less constant working hours per day. Obviously this assumption bears some weaknesses as the majority of POWs were overworked and as working hours and working days per week were far from constant, especially towards the end of the war with Allied bombardment and forced evacuation marches. Still, using this assumption I am able to obtain a minimum base of days worked and avoid upward bias. The resulting sensitivity analysis under different assumptions such as the inclusion or exclusion of the civilian releases and using different sub-datasets yields a range of aggregate man-days worked of 1.7 to 2.3 billion, with the lower bound of 1.8 billion being the most credible result.

And the monetary contribution of POW labour?

Equipped with this output benchmark, the previously attained relative productivity figures and skilled and unskilled civilian wages I then arrive at a range for the monetary contribution of POW labour. The POWs contributed between 1% and 1.5% to GNP every year from 1940 to 1944 and almost 2% per year for three consecutive years from 1942 up until 1944. The contribution of the 7 million foreign and POW workers overall was even greater. Not only was every tenth worker in the Reich foreign or a POW between 1939 and 1944, but the foreign and POW workforce also at peak produced 6% and 7.5% of GNP in 1943 and 1944 respectively and accounted for an average contribution of 4% from 1939 to 1944.

Refs:

• Herbert, Ulrich (1997), Hitler’s foreign workers - enforced foreign labor in Germany under the Third Reich, Cambridge University Press.
• Homze, Edward L (1967), Foreign Labor in Nazi Germany, Princeton University Press.
• Kroener, Bernard R, Rolf-Dieter Müller, and Hans Umbreit (eds.) (1999), Das Deutsche Reich und der zweite Weltkrieg, Band 5, Halbband 2, Organisation und Mobilisierung des deutschen Machtbereichs. Kriegsverwaltung, Wirtschaft und personelle Resourcen l942-1944/45, herausgegeben vom Militärgeschichtlichen Forschungsamt, Deutsche Verlags-Anstalt.
• Pfahlmann, Hans (1968), "Fremdarbeiter und Kriegsgefangene in der deutschen Kriegswirtschaft, 1939-1945", Darmstadt, Wehr und Wissen Verlagsgesellschaft.
• Spörer, Mark (2001), Zwangsarbeit unter dem Hakenkreuz: ausländische Zivilarbeiter, Kriegsgefangene und Häftlinge im Deutschen Reich und im besetzten Europa 1939-1945, Deutsche Verlags-Anstalt.
• Streit, Christian (1978), Keine Kameraden: die Wehrmacht und die sowjetischen Kriegsgefangenen 1941-45, Deutsche Verlags-Anstalt.