The European economy is losing more than 2% per year of its productivity due to inadequacies in employee skills, according to a recent study commissioned by the European Economic and Social Committee. This means a loss of 0.80 EUR per hour. The situation will deteriorate further in the future due to demographic trends and ongoing technological development if no reforms are undertaken.

According to the survey, companies in most European Union (EU) Member States are witnessing an increasing shortage of workers with skills tailored to their needs. In some professions in the fields of IT, medicine, science, technology, engineering and mathematics, as well as in professions such as teachers, nurses and midwives, the impact on the economy is already significant. In addition, there is a tangible shortage of middle-class cadres such as truck drivers, chefs and welders.

The skill mismatches affect European companies, including additional staff training costs, loss of competitiveness and innovation capacity as well as slower recruitment procedures. Over 70% of companies engaged in professional, scientific or technical services and 67% of IT companies have recognized that skills mismatches have a major impact on human resources policies.

The companies from five reference countries interviewed in the survey point out that inadequate traditions in lifelong learning and re-qualification are the most important factor in skills mismatches.

People under the age of 24 and over 65 are most exposed to these inconsistencies. The least likely to be affected are those aged 40 to 54.

Regarding politics, slow or inadequate educational reforms, excessive labor market regulation, excessive labor taxation and arbitrary wage setting mechanisms are the reasons for skills mismatches. Therefore, the change must be done by both national and local authorities and by stakeholders – educational institutions, employers and workers themselves. The political measures are needed at both EU and national level to overcome skills gaps and boost the competitiveness of EU businesses.