Challanges on the labour market


The EU has identified seven flagship initiatives to implement the ‘Europe 2020 Strategy’. hits especially flagship: ‘An Agenda for New Skills and Jobs’. We contribute to the goals of this flagship by offering actionable services to ‘Better functioning labour markets’; ‘More skilled labour force’; and, ‘Stronger policies to promote job creation and demand for labour’. 

From our research, we recognize the following challenges on the labour market:

1. Micro SME's: We have found that 92% of all employers in The Netherlands employ 2-19 employees (‘Micro SME’). This category represents 40% of total labour force. Based on our research, we see similar figures for Micro SME companies ranging from 80% to 90%+ throughout Europe.

2. Unemployment: Unemployment, especially aged under 27 and above 50, is a big challenge in Europe. Although unemployment has decreased, from 23% in 2013 to less than 19% in 2016, the unemployment rate in the afore mentioned target groups is still very high in the EU with peaks of more than 40% in several regions in Europe (Spain, Greece, Eastern-Europe). This is also true for large cities.

3. Under-utilization: It is not only the unemployment rate that is causing an under-utilization of talents, we also see an under-utilization of people that do have work but that are not able to generate their full potential. From a public perspective, this under-utilization leads to unnecessary labour market tensions and inefficiencies as over-qualified people compete with qualified people for jobs they were trained for. It also results in a reduction in tax revenue and it is a hindering factor in economic development as the available opportunities are not fully consumed (this is called the lack of the ‘Chimney-effect’ and is a major driver for public sector to improve transparency).

4. Life Long Learning: In the period 2005-2015, 95% of all job-creation in USA was in Gig-economy. We recognize similar developments in Europe. As a consequence of this development, every individual has to work actively on his agility to be able to generate a decent income. The focus on personal development through Life Long Learning is relevant for all talents no matter if they are looking for work or have work, and no matter their contractual relationship with employers.

5. In- and outflow of Talents: The constant in- and outflow of talents is becoming a major problem for most employers. Especially, the qualification process of applicants is of high relevance. Now, this task is often outsourced to temp agencies and HR services organizations resulting in additional cost in time and money, ranging from €1.000 to €3.000 per placement for VET certified staff.

6. JobBoards: In studies from e.g. Lou Adler, it is found that more than 70% of all vacancies are not published on the internet. If more vacancies would be published, and thus creating a higher transparency, more jobseekers would be able to find a job. 

In short, we recognize three major customer pain points within the Micro SME segment (employing 2-19 people): 

1. Lack of HR infrastructure

2. Lack of Appraisal Process and,

3. Lack of Life Long Learning

Do you want to contribute to QHLX? Please, contact us.