Lack of Qualified Labour – A Problem Not Only in Estonia
Eurochambres - the Association of European Chambers of Commerce and Industry organised a survey among European entrepreneurs for already the 25th time in order to find out what are their expectations and worries for the year 2018. It came out that both Estonian and European entrepreneurs see the coming year as more positive, but the biggest worries continue to be high labour costs and lack of qualified labour force.
The Chamber asked Estonian companies what are their predictions for the coming financial year. For example, the study included questions about sales, export, number of employees, investments and overall economic environment. In total, over 50,000 European entrepreneurs responded to the questionnaire, among them 346 who responded to the questionnaire sent by the Estonian Chamber of Commerce and Industry.
“I am glad to see that as compared to the previous year, the entrepreneurs in Estonia and Europe in general are more positive in their forecasts for the next year,” said Mait Palts, Director General of the Chamber. “However, the share of the entrepreneurs who see an increasing problem in high labour costs and lack of qualified labour is growing,” he explained.
While last year, the lack of qualified labour was the fourth biggest problem among the European entrepreneurs, this year it has jumped to position number two. “The problem of finding employees without the necessary skills has jumped up significantly on the European as well as Estonian level. 46.3 percent of the respondents to the questionnaire organised by the Eurochambres see it as a problem for the coming year. Last year, only 32.1 percent considered it a problem. In case of Estonian entrepreneurs, the jump was from 47 percent to 53.4,” said Palts.
“The biggest problem is the size of labour costs, which is also due to the lack of labour force. Namely, the lack of employees forces to increase the level of salary, which in turn will mean higher labour costs,” said Palts. While a year back, the high labour costs were a problem for 51 percent of the respondents to the Estonian survey, now there are almost 61 percent who think that. The similar trend can be observed in Europe in general.
“Despite of that, Estonian entrepreneurs consider the developments of the year 2018 to be rather in favour of their companies,” said Palts. For example, nearly half of the respondents think that exports will grow for their company and only 7 percent estimate that there will be a decrease. “Although the lack of domestic demand is considered a problem in Estonian as well as Europe, 46 percent of the respondents to the Estonian questionnaire estimate that sales in Estonia will grow in 2018,” he explained.
The Chamber asked Estonian entrepreneurs about their investments in 2017. Over a quarter of the respondents admitted that they cancelled or postponed the investments they had planned for this year. “In total, the respondents cancelled investments in the total sum of approximately 50 million euros this year. The main reasons highlighted by the entrepreneurs were insecurity about the future and lack of financial as well as human resources,” explained Palts.
With regard to the next year, approximately 40 percent of the respondents believe in the increasing of the investments, while compared to the previous year, the share of the companies who plan to decrease their investments in 2018 has increased.
The Chamber’s questionnaire was a part of the economic survey carried out by Eurochambres, which was organised for already the 25th time in 23 European countries. Over 50,000 European entrepreneurs participated in the survey.
See the report of the Eurochambres survey here.