Luxembourg SMEs suffer less from skills shortages

SMEs in the European Union are facing severe skills shortages. Photo: Shutterstock

SMEs in the European Union are facing severe skills shortages. Photo: Shutterstock

According to the European Commission’s Eurobarometer report, skills shortages for SMEs are not only an obstacle to economic growth but also a warning sign for the future of work. Against this backdrop, the data shows that Luxembourg is outperforming the EU as a whole.

The EC’s Eurobarometer report on small and medium-sized enterprises (SMEs) and skills shortages reveals a favourable (in relative terms) situation in Luxembourg: 21% of Luxembourg businesses said that it was “not at all difficult” to find and hire qualified staff over the past 24 months, compared with just 11% across the European Union.

The skills shortage is well known: across the EU, over half of small companies and nearly two-thirds of SMEs struggle to find employees with the right qualifications. In Luxembourg, 30% of businesses find this “very difficult,” versus 38% across the bloc.

Regarding SMEs in Luxembourg in particular, 43% of them feel the effects of the skills shortage. In the technical sector (laboratory workers, mechanics, etc.), for instance, 39% of Luxembourg SMEs are struggling to find qualified workers. This is slightly lower than the EU average, but still significant.

Impact on the labour market and growth

The skills shortage goes beyond the frustration of searching for new recruits: it increases the workloads of existing employees and puts pressure on sales and growth targets. Three out of ten European SMEs report a negative impact on their economic performance as a result of skills shortages.

Faced with this situation, Luxembourg is seeking skills on an international scale: 49% of the country’s SMEs are exploring the EU-wide job market and 19% are looking beyond the EU.

Proposed support measures

The Eurobarometer report suggests--as ways to help SMEs--tax incentives, closer collaboration with public employment services and direct subsidies. Its authors argue that having a workforce with the right skills paves the way for a more robust and competitive economy, both for Luxembourg and the EU generally.

In line with European objectives, and as part of the “European Year of Skills,” Luxembourg is currently developing a national skills strategy. The aim is to ensure that, by 2030, 60% of European workers receive annual training.

This article was originally published in Paperjam. It has been translated and edited for Delano.