ICT specialists: the skills gap hinders growth in the EU countries
A recent Eurostat survey looked at some of the main obstacles small and medium-sized entreprises (SMEs) and larger companies encounter in recruiting information and communication technology (ICT) professionals - and how this has impacted economic growth and state-of-play in the labour market. Survey results point to an adverse trend: 55% of companies experienced difficulties in recruiting ICT specialists over the course of 2019. In addition, SMEs struggled more often in filling ICT vacancies. However, reasons such as lack of applications, lack of relevant qualifications and higher salary expectations were shared by both SMEs and their larger counterparts alike. These trends impacted employment, leading to a more complex or unsuccessful recruitment process.
These developments not only have the potential to affect the competitiveness of EU Member States - they also impact directly European ability to reach the target of 20 million ICT specialists in the EU by 2030, put forward in the European Commission's Digital Decade Communication.
Assessing the skills gap across companies
The data for ICT specialists - statistics on hard-to-fill vacancies in enterprises was collected as part of the 2020 survey on ICT usage and e-commerce in enterprises, aiming to quantify and better understand the current skills gap in a number of selected economic sectors:
- Electricity, gas, steam and air conditioning supply; water supply; sewerage, waste management and remediation activities;
- Wholesale and retail trade, repair of motor vehicles and motorcycles;
- Transportation and storage;
- Tourism and accommodation;
- Information and communication;
- Real estate activities;
- Professional, scientific and technical activities; and
- Administrative and support service activities (excluding 'travel agency, tour operator and other reservation service and related activities')
The skillset analysed was that of ICT specialists in enterprises: the survey was focused on EU enterprises that had recruited professionals with ICT skills of various types, that had organised ICT skills trainings for their workforce and finally the percentage of outsourced ICT activities or projects.
Eurostat’s definition of ICT specialists for this particular survey was "workers who have the ability to develop, operate and maintain ICT systems, and for whom ICT constitute the main part of their job": the professionals at the centre of this survey have a fundamental role in the digital transformation of business processes (e-business) and commercial transactions that are carried out electronically (e-commerce).
More than half of companies surveyed struggled to fill ICT vacancies
The results show first of all a situation where, in 2020, 19% of EU enterprises employed ICT specialists, with differences from one sector to another: the information and communication sector had the highest proportion, with 72% of enterprises employing ICT specialists in 2020, followed by the ‘professional, scientific and technical activities’ sector (30%), ‘electricity, gas, steam, air conditioning and water supply’ sector (26%) and ‘real estate’ (23%). With 8%, the construction sector represented the lowest ratio of enterprises employing ICT specialists for that period.
The percentage of large enterprises employing ICT specialists (76%) was more than 5 times higher in 2020 than the ratio of SMEs employing ICT specialists (14%): this situation is also due to the difficulty in finding the appropriate ICT specialists on the part of SMEs. In 2020, 8% of EU enterprises reported that during 2019, they recruited or tried to recruit ICT specialists and 5% had difficulties in filling those vacancies. In addition, 55% of companies in 2019 struggled to fill these vacancies: lack of applications, lack of relevant qualifications and experience and high salary expectations were among the main factors that made the recruitment more complex and/or unsuccessful. The last factor mentioned, the salary expectations, is also one strong element that makes hiring ICT professionals more complex for SMEs, compared to large enterprises.
Training the workforce and outsourcing: two strategies to keep up with digital transformation
Training the workforce in ICT skills at all levels also proved, although an essential tool to deal with digital transformation, a tricky issue for SMEs: in 2019, 20% of EU enterprises provided training to all their staff in order to enhance their ICT related skills, 68% among large enterprises, which was more than four times higher than for small enterprises (15%). The proportion of enterprises providing ICT training to their ICT specialists ranged from 3% of enterprises in construction to 51 % in the sector of information and communication. In 2019, 17% of EU enterprises also provided ICT training to ‘other persons employed’. In all the economic sectors, except for the sector of information and communication, the share of enterprises providing ICT training to non-specialist staff was higher than the ratio of enterprises providing training to ICT specialists.
One of the consequences of the skills gap and the difficulty to hire qualified ICT professionals is the very high percentage of outsourcing of ICT services, especially in some EU countries, such as Cyprus and Latvia, where ICT outsourcing is as high as 84%. The share of enterprises outsourcing their ICT function reached 81% among large enterprises, compared with 69% for small enterprises in 2019. On the other hand, the disparities between the enterprises of different size classes were much higher when comparing the share of enterprises where own employees performed the ICT functions. While in 85 % of large enterprises the ICT functions were performed by own employees, this was the case only in 36% of small enterprises.