The pandemic has created an “unparalleled labour market crisis” which will affect the employment market for years to come.
The views and opinions expressed in this article are those of the author.
Whilst youth unemployment currently sits at 17 per cent across Europe, Eurostat reports the job vacancy rate to be 2.3 per cent in the Euro Area.
This discrepancy rings true across the globe, where 69 per cent of employers have reported significant difficulties in hiring staff.
At the close of 2021, labour markets in the UK and mainland Europe are at a turning point. The number of job vacancies has continued to rise across much of the continent - in the UK, vacancies reached the highest number since records began last month and several European nations are reporting similar challenges.
This vacancy paradox is no doubt already having adverse effects on the success and competitiveness of European enterprises.
2021 - A fragmented recovery
Throughout the year, we have seen vaccination campaigns starting all over the world, this causing the Covid-19 situation to gradually improve, particularly in western nations.
Whilst the first quarter of 2021 was dominated by lockdowns, the second quarter saw the beginning of the general reduction of social distancing measures and reopening of society.
Many countries announced the end, partially or entirely, of financial assistance to businesses and individuals and as such, the rebound of the economy was initiated.
So why, almost a whole year later, does the situation seem so bleak?
There are several reasons for this – namely, that the consequences of the pandemic go far further than people just losing or changing their jobs. Education and training have been gravely impacted, as has the confidence and drive of many workers.
Lockdowns have also made people re-evaluate how their mental health and wellbeing is impacted by work and to reconsider their career choices – a key factor of ‘The Great Resignation’.
Ultimately, the pandemic, hand in hand with the skills shortage, has created an “unparalleled labour market crisis” which will affect the employment market for years to come. This will only be solved if significant investments are not made in tackling the problem at its root.
Omicron – a cause for concern?
With the recent emergence of Omicron, it’s clear we’re not out of the words yet. The Organisation for Economic Cooperation and Development (OECD), has even warned that the new Covid variant could mean severe global consequences, this begging the question – will Omicron further hamper business recruitment?
It will certainly have an impact – we saw with both the original outbreak and again with Delta that the initial response was to fire and furlough workers – but the truth remains that regardless of any new variant, it is the skills gap which remains one of the most crucial challenges for European governments.
Now is the time to invest heavily in the skilling, upskilling and reskilling of workers. We need to look ‘beyond the crisis’ and see that whilst we will find a way of living with this latest new variant, we desperately need to find a way to close the skills gap for the generations to come.
Addressing the skills gap in 2022
JA Europe works in 43 countries across Europe and is known in the UK as Young Enterprise. From our experience, much of Europe is heading towards a digital skills shortage with fewer than half of all employers believing young people are leaving full-time education with sufficient business skills and digital knowledge.
According to the ManpowerGroup Talent Shortage Survey 2021, the roles most in demand are in Operations and Logistics; Manufacturing and Production; Sales and Marketing and IT and Data.
But what are the key skills needed to access those positions?
Unsurprisingly, in addition to the specific technical skills employers are looking for: Reliability, resilience, stress tolerance and adaptability come up top, along with initiative taking, leadership and social influence, reasoning and problem solving.
All of which are non-cognitive skills essential to finding and keeping a job.
Digital skills are needed across all sectors and positions, but what we learned from the pandemic is that whilst there is a lack of digital skills, there is not a lack of talent in Europe.
Talented young people living in rural areas in low social economic urban areas are simply outside of mainstream recruitment programmes.
Several unemployed groups are simply failing to meet workplace needs due to barriers to information access and a lack of investment in training and upskilling.
Groups from a lower socioeconomic background, for instance, are experiencing significant limitations due to a lack of digital participation and technological skills. These issues were highlighted in a recent Europe-wide study by JA Europe, supported by the NN Group, where it was revealed the pandemic has further damaged the career prospects of the most vulnerable young people.
Inclusive recruitment schemes
So, the question is – how do we get more unemployed people into the workplace in the current climate? First of all, by tapping into different groups where talent is. By creating a pipeline of talent rather than stealing talent between companies.
There are many ways this can be done, including leveraging technology and creating virtual apprenticeships for the unemployed living outside of urban areas, engaging prospective employees with coaching and mentoring and hiring diversity officers in HR departments who can broaden out the channels used for recruiting.
At the same time, businesses across Europe, of all sizes, need to work more effectively with government agencies and civil society organisations to introduce catch-up schemes, training and reskilling programmes and job guarantees, to help prepare current and future employees for the world of work.
With pandemic-weary corporates now trying to assess the potential impact of the Omicron variant, employee retention and sourcing the talent is crucial.
Some jobs will disappear, many will be transformed, but new jobs will also be created.
A focus on inclusive recruitment schemes for new and adapted jobs will put us in a stronger position to face future challenges, both during Covid and beyond.
- Salvatore Nigro is the CEO of JA Europe, a provider of education programmes for entrepreneurship, work readiness and financial literacy.