Labour shortages: not a shortage of skills so much as a shortage of pay

The European Year of Skills will be officially launched on 9 May 2023, but debates about labour shortages should not be focusing only on skills. Labour shortages in the European Union (EU) are currently rising more due to low wages and poor working conditions than as a result of workers’ lack of qualifications, according to a study published by the European Trade Union Institute.
 
European economies have weathered the Covid-19 pandemic relatively well but, as underlined in the study, labour shortages have clearly increased more among jobs with relatively lower wages, and they are higher in sectors and profiles that do not necessarily require higher skills.
 
'The worst shortages we are now seeing are not just a matter of skills or even finding workers. The problem is to find people who are willing to do these strenuous jobs for such low pay and under such bad conditions,' said Wouter Zwysen, ETUI Senior Researcher and author of the study. 'But the policy debate – as illustrated by the informal meeting of employment and social affairs ministers which took place on 4 May 2023 in Stockholm – is dominated mainly by the narratives of a mismatch in skills; with the question of which skills are necessary given the rapidly changing context of digital and green skills; and the need to incentivise greater mobility and migration.'
 
Skills are only one, albeit an important, part of the labour shortage phenomenon, confirms a note prepared by Eurofound, the Foundation for the Improvement of Working Conditions, for this informal meeting last week. Analysis of data from the European Working Conditions Telephone Survey 2021 shows that labour shortages are particularly prevalent in sectors with poor job quality.
 
The findings demonstrate the need to increase collective bargaining and improve wages and working conditions, as well as skills, if Europe is to end its labour shortages. European trade union representatives have already drawn attention to the fact that, in half of EU Member States, real wages fell in 2022 despite the growth in real profits.