As EU Year of Skills wraps up, Commission sets out an action plan to tackle labour and skills shortages

• April 9, 2024
• admin

Labour and skills shortages are on the rise in all EU Member States, and improving labour market participation is at the very heart of solving this problem. Despite advances in overall EU employment rate, skills gaps are apparent. This is especially the case for disadvantaged groups like refugees and migrants, women, and young people.

Notably, Eurostat estimates that 21% of today’s population aged 20-64 remains inactive. In effect, this means that a substantial untapped potential is left outside of the labour market. 

The Big Short: how large is the gap exactly?

Skills shortages are reported by companies across all sizes and sectors in the EU economy, with particular challenges for SMEs. In one recent Eurobarometer study, 4 out 5 SMEs declared that it is difficult for them to find workers with the right skills, and more than half found it difficult to retain skilled workers.

The action plan is also a key deliverable of the European Year of Skills. It builds on the many policy
and funding measures already in place at EU level, such as the Pact for Skills – which has so far
provided training to 3.5 million workers –, the 2030 employment and skills targets endorsed at the
Porto Social Summit, the adequate minimum wages and platform work directives, and the €65 billion
in EU funds available to invest in skills.

Nearly two thirds (63%) of small and medium-sized businesses said in a recent survey that they cannot find the talent they need. In addition, the Commission has identified 42 occupations which have shortages. To address these labour and skills shortages, the Commission has presented an action plan setting out key measures that the EU, Member States and social partners should take in the short to medium term. It will help unlock the EU’s growth potential, support its competitiveness, and provide better opportunities for all.

There are five areas for action:

Supporting underrepresented people to enter the labour market
Providing support for skills development, training and education
Improving working conditions
Improving fair intra-EU mobility for workers and learners
Attracting talent from outside the EU

For almost a decade, labour and skills shortages have been increasing in all Member States.  The Commission has identified 42 ‘shortage’ occupations, with some differences across the
Member States.