Published on 11th March 2025
Across various sectors—construction, healthcare, science, technology, and engineering—labour shortages in Europe are becoming increasingly pronounced. Both high-skilled and low-skilled occupations are affected, and these shortages are expected to worsen as the population ages and as the green and digital transitions progress.
According to our recent research, The Work We Want, 81% of executives predict that AI and other innovations will necessitate a fundamental rethinking of workforce skills and resources. Additionally, 78% express concern that their organizations are unable to train employees quickly enough to keep pace with technological advancements. Lifelong learning and workforce adaptability will be crucial for successfully navigating these changes.
Recognizing the risk of those challenges hindering the EU’s productivity and competitiveness, the European Commission presented a proposal for a “Union of Skills” on March 5th as a concrete measure to address this situation. This comprehensive strategy aims to focus on investment, adult and lifelong learning, skills retention, and the recognition of diverse training types to equip European citizens with the skills necessary to thrive in a rapidly changing job market. However, we believe there is still a need for more innovative solutions regarding training, career guidance, and labour mobility.
Nurturing Skills Ecosystems
To transform the proposed Union of Skills into a game changer for the prosperity of Europe and its citizens, the World Employment Confederation advocates for broader collaboration among stakeholders, including public and private employment agencies, Vocational Education and Training (VET) providers, trade unions, and businesses. Nurturing such “skills ecosystems” would ensure that both employers and workers have their needs addressed with minimal bureaucracy and ease of access.
Addressing skills and labour shortages also requires a stronger emphasis on labour mobility and migration. The World Employment Confederation-Europe supports demand-driven legal migration initiatives, such as the EU Talent Pool, which should include HR services and employers to facilitate effective labour market matching and simplified procedures. However, the lack of recognition for skills and qualifications—particularly those obtained abroad or outside of formal education—continues to hinder labour mobility. WEC-Europe also believes that developing digital and micro-credentials, which could be stored in an EU digital wallet, along with individual learning accounts, could promote skills portability.
Finally, skilling alone is insufficient in the increasingly complex labour markets. WEC-Europe stresses the importance of providing career management, outplacement, and support services to help individuals navigate transitions. In 2023, WEC member companies specializing in career management supported 520,000 individuals across over 15,000 companies worldwide.
While many HR services have struggled due to harsh economic conditions, demand for career transition services remains strong as employers struggle to find the talent they need. The Work We Want research indicates that 80% of senior executives believe talent planning has become more complex than ever, and 82% acknowledge that traditional approaches to talent acquisition and retention are no longer effective.
An Essential Component of Quality Jobs
To achieve Europe’s social and economic goals, we need a more holistic approach to skilling. This could be further integrated into the EU’s forthcoming Roadmap for Quality Jobs. The European Foundation for the Improvement of Living and Working Conditions, Eurofound, evaluates job quality across seven dimensions, and skills is actually identified as one of them.
In addition to decent working conditions, health and safety, social protection benefits, equal treatment, and equal pay, the private employment services sector has emphasized skilling as a critical component of job quality for decades. For example, in 2023, the sector trained 1.4 million agency workers in Spain, France, and Italy combined. Various training schemes exist, often developed through joint initiatives between the agency work sector and trade unions – which underlines the role of social dialogue as a very powerful vehicle for more effective skills policies.
As we further develop our vision of what quality jobs should be, the European private employment services industry will continue striving for solutions that enable better labour market outcomes for all and sustainable growth. The foundation of competitiveness is people. To close the innovation gap and ensure the EU remains competitive, we must invest in our human resources. This is just the beginning.
