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Europe – Between a half and two thirds of EU firms with difficulties finding skilled workers face the problem for reasons other than lack of skills

The global crisis has increased unemployment in the EU to unprecedented levels, yet many employers claim they have difficulties finding skilled workers to fill their vacancies. This report shows that most vacancy bottlenecks arise because of factors other than general skill deficits, including job offers of poor quality.

Genuine skill shortages affect a small group of dynamic, internationally oriented European enterprises in specific economic sectors (health and social care, ICT, advanced manufacturing).

To mitigate skill bottlenecks, European companies must commit to offering high-quality apprenticeship places and good-quality jobs, which can be supported as part of a process of social dialogue between VET providers and labour market actors. Ultimately, the business and product market strategies of a greater share of European firms will have to become reliant on higher skill needs. The role of VET in developing creativity and entrepreneurial capacity in the European workforce will be crucial.

Empirical findings of report

Between a half and two thirds of EU firms with difficulties finding skilled workers face the problem for reasons other than lack of skills: unattractive job offers (unwillingness or inability to offer a competitive market wage; bad job quality; precarious contracts); and lack of employer commitment to talent management. The remaining firms meet genuine skill shortages: inability to find job applicants with the right skills, despite their willingness to pay the price for the skills sought. Genuine skill shortages are a marker of growing, dynamic, international enterprises and are more likely to prevail in specific economic sectors such as health and social care, ICT, and manufacturing.

Hiring difficulties, particularly when related to shortages of staff in high- skill jobs, are a constraint on firm productivity and the adoption of innovative technologies and forms of work. But other obstacles, such as the high cost of labour and lack of access to credit, also affect organisational performance.

For organisations with business strategies reliant on a skilled workforce, with focus on quality improvements and product differentiation, skill shortages can be an indicator of positive business outcomes (such as increasing financial turnover and employment). The reverse is true for organisations adopting business strategies based on cost reduction and volume-based production.

Skill gaps, a misalignment between the skills required to do the job in the best possible way and the skills of workers, are common in some European countries. According to a pilot survey carried out by Cedefop in four Member States (Germany, Hungary, the Netherlands and Finland) in 2011, about a quarter of all workers reported a significant skill gap.

Skill gaps are linked to job complexity; organisations that design their jobs so that skills of different breadth and depth are required by the staff to carry out their duties are characterised by larger skill gaps. The reason is that complex jobs are associated with a higher level of skill demand, which demands greater expertise of employees so that they are fully proficient in their jobs. But such high-performing organisations also tend to invest more in employee skill development to tackle emerging skill gaps, rendering the cost of skill mismatch smaller and the productivity gains for the firm larger.

Capture d’écran 2016-04-13 à 08.58.48Chosen excerpts by Job Market Monitor. Read the whole story at  Skill shortages and gaps in European enterprises | Cedefop

Related Post

A Training Gap, Not a Skills Gap – Interview with Professor Peter Cappelli

Knowledge@Wharton: One of your chapters in the book is called “A Training Gap, Not a Skills Gap.” You have some figures showing that in 1979, young workers received an average of two and a half weeks of training per year. By 1991, only 17% of young employees reported getting any training during the previous year, … Continue reading 

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