High end manufacturing does employ less people. But the same doesn't necessarily hold for some other sectors. Niche markets like renewable energies and organic agriculture employ more people than centralised energy or industrial agriculture.

The point that the reunification of Germany added a large labour force that had a skill-set ill-adapted to a high road strategy is valid, I must admit that I forgot that. Re-education and continuous education of the workforce is a crucial part of any high road strategy, but the problems with the East Germans may have been to large for such a strategy to work in the past.

Nonetheless, Germany will face a longer crisis due to its ageing population and if it doesn't adjust its strategy to maximise per capita income on the long term, it's going to have to cut old age entitlements rather drastically. That will be at least as politically unsustainable.