Wage and Task Profiles of Employment in Europe in 2030 – Labour market is set to become even more polarised

Europe’s labour market is set to become even more polarised, largely due to the growth of jobs at the very bottom of the wage distribution. However, across the EU28, there is considerable heterogeneity in the patterns of structural change by job-wage quintile, with many Member States projected to upgrade their occupational structure towards higher paying jobs.

This latest short report from Eurofound, which forms part of the Cedefop-Eurofound joint report Skills forecast: Trends and challenges to 2030 examines the implications of projected structural change for the wage and task structure of employment in Europe up to 2030.

‘Structural change is expected to move much faster in the Member States who joined the Union after 2004,’ says Donald Storrie, Chief Researcher at Eurofound, ‘and we forecast big changes in the occupational wage and task structure in these countries in the run up to 2030.’

A major driver of the structural change is globalisation. Recent decades have seen significant changes in the global distribution of labour, and global competition and market opportunities are likely to continue to impact upon the structure of employment in Europe.

In this context, relative wages and productivity are the key determinants of which jobs will remain and grow in Europe and which will be lost to foreign competition. As manufacturing still dominates global trade, it is the main sector impacted by globalisation.

The most striking result of the job wage quintile results is the projection of a more polarised labour market in the EU. This is driven mainly by the growth of jobs at the very bottom of the wage distribution. It is above all France, the UK and Spain that account for the EU total strong growth at the bottom. However, there is considerable heterogeneity in the patterns of structural change by job-wage quintile, with many Member States projected to upgrade their occupational structure towards higher-paying jobs. Among these are Slovenia, the Czech Republic, Croatia, Latvia, Estonia, Hungary, Malta, Denmark and Finland. Projected polarisation is particularly strong in Germany, France and the Netherlands. Another striking result is that net change in industrial jobs is concentrated in the top three job wage quintiles, with no net change in the bottom two. Within the top three quintiles one observes a distinct pattern of upgrading with significant employment growth at the very top.

The implications of the projected structural change up to 2030 on tasks in European workplaces was analysed along two main dimensions: the content of the tasks and the methods and tools with which tasks are performed. In terms of the content of tasks, there is a projected decline only in physical tasks with an across-the-board increase in all the sub-categories of intellectual and social tasks. Three types of tasks stand out in terms of their projected increase – namely, business literacy, selling/persuading and serving/attending. The first two are related both statistically and conceptually, as both have a highly commercial nature. It was suggested that the observed increase also in serving/attending might also be related to caring tasks, which was not directly measured in the otherwise comprehensive task framework. The biggest overall change in any of the indices was the use of basic ICT skills (one of the means and tools for performing tasks). There was also a projected increase in autonomy and a decline in routine. A highly significant decline in work with (non-ICT) machines is correlated both with physical and routine tasks.
Overall there are some highly relevant differences between the group of Member States that have joined the Union since 2004 and the others. The countries showing strong upgrading tendencies include many of the more recent Member States. These countries also generally show much stronger-than-average projected decline in physical and increases in social and intellectual tasks. It was emphasised several times in this report that what is being measured, in both the wage and task analysis, are compositional changes. These results indicate that the higher rate of projected structural change in these Member States is a positive one – of upward convergence in the employment structure in Europe.

Chosen excerpts by Job Market Monitor. Read the whole story at Wage and task profiles of employment in Europe in 2030 | Eurofound