Re-skilling and up-skilling. Factors of asymmetric human capital distribution in the EU regions

The “Agenda for Skills” (EC, 2016), the new “Agenda for Skills for Sustainable Competitiveness, Social Justice and Resilience” (EC, 2020), and the proclamation of 2023 as the European Year of Skills, all constitute reflections of the great importance of skills for policymakers in the EU. In these documents, the European Commission sets ambitious goals for upskilling (i.e., upgrading existing skills) and re-skilling (i.e., providing new skills), with an implementation horizon of 2025. On a broader note, the EU aspires to guarantee access to ongoing education and lifelong learning across all its regions, including remote and rural areas. In this sense, the European Commission’s current policy toolkit reflects the basic principle, that, not only people who invest in education and training improve their skills and competencies are paid off in the long run, but also that an improved human capital skills-wise can decisively contribute to macroeconomic growth. However, as indicated in the relevant literature, investing in skill development does not always carve a path to prosperity for individuals, nor does necessarily lead to economic growth. For one, the diffusion of knowledge is asymmetric across regions and not equally available to all economic actors. At the same time, a good part of the high-skilled labour force is employed in jobs that do not make full use of their skill set (Sala, 2011; McGuiness et al., 2018; Brunello and Wruuck, 2021).

Our research on skill supply and demand across the EU regions showed that the distribution of human capital stemsfrom a series of parameters, including the national and regional economic dynamism, the composition of local industrial structures, urbanisation levels, local institutional structures and practices, and population dynamics. Regarding the first, countries with robust economies occupy a more favourable position within global value chains, which translates in them hosting high value-added activities. Regions across such favourable zonesdevelop knowledge-intensive sectors, strengthening their industrial structure. The above directly lead to an increased demand for a high-skill workforce. At the same time, dynamic metropolitan areas within urbanised regions not only develop economies of scale around niche technologies, but they also constitute attractive environments for a high skilled and creative labour force (Florida et al., 2008). Thus, both demand for and supply of highly trained workforce increases. In contrast, peripheral regions are mostly left out of any spill-over effects, while they are also linked with weaker institutions and governance efficiency. Limited labour and lifelong education opportunities therein lead – among other things – to greater mismatches between the education level of the workforce and the skill demand in the labour market, as our research highlighted. Finally, demographics directly shape the geography of skills: new technologies render the skill set of older workers obsolete, with these cohorts having lost their incentive to retrain (McGuiness et al., 2018). Thus, the weight of meeting skill demand falls upon the shoulders of those entering the labour market (Cedefop, 2015), who, amidst intense competition, have to see their training as a “defensive necessity for protecting [their] place in the job queue” (Sala, 2011).

In conclusion, our research highlights the need for a series actions, which align with the new EU Skills Agenda. First, the collaboration between educational institutions and industry stakeholders is crucial in disseminating innovation. Second, social partners have to participate more actively in labour market forecasting, which can identify skill shortages and trends early on. Last, the development of green skills is anabsolute priority considering the need for an energy transition; should the development of such skills is achieved, it will create a generation of climate-, environment- and health-conscious professionals, which can ultimately benefit both the economy and workers.

Effie Emmanouil and Kostas Gourzis, YOUTHShare Project, Department of Geography, University of the Aegean, Greece



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