Unemployed in Europe Hobbled by Lack of Technology Skills
Paulo Nunes dos Santos for The New York Times
DUBLIN — Week after week, newspapers issue a stream of hopeful headlines: Microsoft, PayPal, Fujitsu and scores of other companies are expanding their investments in Ireland, creating thousands of jobs as unemployment hovers near record highs.
There is just one hitch: Not enough people are qualified to fill all the jobs. In some cases, the companies have had to look outside Ireland to recruit candidates with the right skills.
After a five-year economic crisis, the mismatch represents one of the thorniest problems facing Ireland and many other European countries. Hundreds of thousands of people who lost work, and many young people entering the work force, are finding that their skills are ill suited to a huge crop of innovation-based jobs springing up across the Continent.
"In all countries, there is an expectation that many of the new jobs created will be in the knowledge-intensive economy," said Glenda Quintini, a senior labor economist at the Organization for Economic Cooperation and Development. "But we are seeing a worrisome skills mismatch that means a large number of unemployed people are not well prepared for the pool of jobs opening up."
Employers have long complained that graduates do not have the skills they need. But in a recent report, the International Labor Organization warned that "skills mismatches and occupational shifts have worsened" in Europe in the wake of the crisis. People laid off in hard-hit sectors, from construction to finance, face lengthy retraining, while too few graduates entering the job market have chosen engineering, science or technology degrees for the growing innovation-based jobs market.
The gap in Europe has important consequences for the recovery as the euro zone grapples with unemployment rates stuck stubbornly above 12 percent: It may hold back a return to meaningful growth and generate "significant economic and social costs," according to the European Commission, the policy-making arm of the European Union.
The International Labor Organization went further, warning that the gap might contribute to extended spells of unemployment and might reduce the effectiveness of policy interventions to stimulate growth. In the United States, the phenomenon has also helped contribute to a rise in long-term joblessness, the organization said.
Around two million job vacancies around the European Union are languishing unfilled, about the same number as in 2010, in sectors ranging from hotel work to computer programming, according to Eurostat, the statistics office of the European Union.
A study released in November by Eurofound, the research arm of the European Union, showed that despite the recession, almost 40 percent of companies reported difficulty in finding workers with the right skills, compared with 37 percent in 2008 and 35 percent in 2005.
The problem is especially striking for innovation-based companies, which are generating jobs at a rapid clip as technology spreads through every sector of the economy. By 2015, about 900,000 information and communications technology vacancies may go unfilled in the European Union, the European Commission warned in a recent report on the digital economy. The gap "is of major concern to European competitiveness" and to the economy as a whole, the commission said.
Governments and companies around Europe are fast-tracking efforts to retrain the unemployed for a burst of technology-related jobs. They are also stepping up campaigns to lure university students to mathematics, engineering and science in place of popular courses in the humanities and social sciences.
In Ireland, the government introduced a series of retraining and higher-education programs and sought to polish the allure of mathematics degrees as alarm bells sounded over the issue a couple of years ago. At the time, unemployment was around 14 percent after an economic collapse that destroyed jobs in the construction sector, which had employed around a quarter of the young men in the country.
Multinational technology and social media companies kept investing, lured by Ireland's ultralow 12.5 percent corporate tax rate and an English-speaking work force. But many have been forced to look outside the country for employees with the right skills, despite more than 391,500 being out of work and a jobless rate of around 12.5 percent.
The issue peaked last summer, when PayPal's chief executive in Ireland, Louise Phelan, stoked controversy by acknowledging that the company had recruited from 19 other countries for 500 positions in its operations center in Dundalk because of a lack of foreign-language skills among Irish nationals. This summer, Fujitsu, which employs 800 people in Ireland, revealed that it had had to hire most of its Ph.D.-level experts from abroad.
By CHARLIE SAVAGE 04 Jan, 2014
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Source: http://www.nytimes.com/2014/01/04/business/international/unemployed-in-europe-hobbled-by-lack-of-technology-skills.html?partner=rss&emc=rss
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