· Causes of unemployment go beyond state of economy, says new report from Hays plc
· Unemployment and unfilled vacancies rising across global markets
· Global education systems failing to deliver requisite skills and talent to employers
The global economy is facing a severe talent mismatch with 18 out of 30 leading economies facing some form of skills shortages while both unemployment levels and numbers of unfilled vacancies are rising. In many markets, the labour available does not meet the skill requirements that employers are looking for.
These are the findings of the Hays Global Skills Index 2013, a report published today by Hays plc, the leading global professional recruiting group, produced in collaboration with Oxford Economics. The report, titled ‘The Great Talent Mismatch’ and based on an analysis of professional employment markets across 30 major global economies, highlights the extent to which businesses and governments have to work together to build the right skills pipeline to deliver a sustainable recovery and growth.
The problem of talent mismatch spans several continents. The situation is particularly serious in the US, struggling with a jobless recovery; Spain, Portugal and Ireland, all badly affected by the Eurozone crisis; Japan, struggling with a generation of economic stagnation and deflation, and the UK where the current economic recovery is exposing a lack of skills across multiple industries.
“The Hays Global Skills Index highlights a major paradox in the world’s skilled labour markets. Employers across the globe are struggling to find enough people with the right set of skills for the posts they have available, even as millions of people remain unemployed.
The supply of people with the right skills is the foundation for every successful organisation and finding the right person for a job can transform businesses, people’s lives and make societies stronger. There are no easy answers to fixing today’s problems in the world’s skilled labour markets. However, we believe the principles outlined in our recommendations are relevant across the globe and should enable real progress towards addressing structural problems within international labour markets”, says Hays’ Chief Executive Alistair Cox.
The Hays Global Skills Index creates a score for each country of between 0 and 10 to measure the constraints and frictions being faced by its market for skilled labour. This is calculated through an analysis of seven components, covering areas such as education levels, labour market flexibility, and high-skill wage pressures.
A score above the mid-point of 5.0 suggests that employers are witnessing difficulties finding the key skills they need and are suffering market friction, whilst a score below 5.0 indicates a lax labour market in which there are no major constraints on the supply of skilled labour.
Sweden’s score for 2013 is 6.3, suggesting some significant labour market pressures exist. At least some of this will be accounted for by economic growth in the country: Sweden is expected to see the highest rate of economic growth in Europe in 2013, with GDP forecast to rise by 1,5 % (up from 1,2 in 2012). Like Germany, but unlike several other European countries, Sweden’s downturn was sharp and the recovery quick, with economic growth having returned to its pre-crises trend.
Significant wage pressure in high-skill industries and unfilled job vacancies of more than 49,000 suggest some employers are struggling to find the skilled labour they need.
’’Sweden is very much a service-orientated society, nearly 75 per cent of the economically active population works with the provision of services, either in the private or public sector. The Swedish labour market is known for combining business innovation, generous employment benefits and long-term job security. A recent law has made it easier for people outside of Europe to move to Sweden for work, this is to attract workers to industries that are unable to find enough qualified employees. Receiving an offer of employment from a Swedish company or organisation then enables the jobseeker to apply for a work permit.’’ says Marie Svärd, Country Manager, Hays Sweden.