From Data to Action: Innovative Solutions to Tackling Europe’s Skills Mismatch

28/01/2025

By Sharon Belli, PhD, Senior Research Expert, Ipsos European Public Affairs

Skills mismatch and skills shortage continue to challenge European Union (EU) economies. As we enter a new year, the question is not whether this problem exists but how it can be addressed. Innovative research, such as that conducted by the TRAILS project, can significantly contribute to addressing this issue by providing accurate and timely data, facilitating cross-border comparisons, evaluating the effectiveness of interventions, and uncovering barriers to skill development.

A recent Flash Eurobarometer Ipsos for the European Commission reveals severe skills shortages across European businesses. The study found that 53% of micro companies, 65% of small companies, 68% of medium-sized companies, and 72% of large companies face this challenge. Technical roles are particularly affected, with about half of industrial and manufacturing companies struggling to find suitable candidates. Companies facing skills shortages cite the main reasons as being a lack of appropriate qualifications, skills, or experience among applicants. A similar proportion report receiving few or no applications for some open positions.

The EU addresses skills mismatch through its  European Skills Agenda, aligning individual skills with market needs. Initiatives like the European Education Area, Digital Education Action Plan, and European Alliance for Apprenticeships aim to equip citizens for the digital age and evolving work environment.

While EU-wide initiatives lay the groundwork, innovative research projects like TRAILS are crucial for providing policymakers with the tools and insights needed to develop targeted, effective strategies. The TRAILS project stands out for its multi-faceted approach to addressing the skills mismatch. Established in 2024, the project brings together key stakeholders from across Europe. Such a collaborative approach is crucial to ensuring the development of practical, industry-relevant solutions that are directly applicable to real-world scenarios.

The TRAILS project aims to bring innovation to the skills research landscape by implementing new approaches to data collection and analysis that will better enable decision-makers to monitor skills gaps across EU Member States, mapping existing barriers for businesses and the degree of workforce adaptability. Hitherto, a key challenge in addressing the skills mismatch has been a lack of uniform data on the problem across the EU. This has not only made measurement difficult but has meant that different countries may base their policies on varying datasets, leading to fragmented approaches across the EU. A more consistent approach to data collection and analysis, in contrast, would enable policy-makers to make valid cross-country comparisons, identify common trends and support the development of targeted EU-level interventions to address the skills mismatch. To this end, TRAILS is integrating existing databases with new cross-country survey data, creating a standardised dataset that spans both employee and employer perspectives.

Another critical challenge in addressing the skills mismatch to date has been a lack of real-time or near-real-time data to capture the rapidly evolving landscape of workforce skills and employer demands. TRAILS is seeking to address this challenge by using Machine Learning (ML) algorithms to estimate workers’ characteristics and task assignments, analysing matched employer-employee data. This represents a significant leap forward in skills mismatch measurement, as it will provide a more informed understanding of firms’ needs vis-à-vis workforce skills. Furthermore, the approach will help identify which types of mismatches are growing within specific sectors or workforces, in turn allowing for more targeted remediation measures.

Of course, addressing the skills mismatch also demands an upskilling and reskilling of the workforce via accessible training. Adult learning participation is crucial in this regard, as it helps workers meet labour market demands and maintain employment. A recent study found that 13% of EU workers are significantly digitally under-skilled, with 39% moderately so. Of these workers, fewer than half (46%) have participated in any form of digital skills training, and only around a quarter (27%) have participated in non-ICT-related training. Twenty-seven percent have not participated in any training at all. This indicates that a significant proportion of workers still face barriers to accessing and participating in digital skills development opportunities. To help address this, TRAILS is analysing big data from various sources, such as online job postings, social media platforms, and educational databases, and combining it with the ESCO taxonomy (a standardised classification of European skills, competences, qualifications, and occupations). The aim is to identify skills gaps, forecast emerging skills requirements, suggest tailored training programmes, and assess the impact of different training initiatives on employability and career advancement.

TRAILS showcases the power of cutting-edge research in deepening our understanding of skills mismatches. By harnessing the potential of big data and artificial intelligence, the project introduces a novel methodology for examining workforce trends, paving the way for more precise and effective policy interventions in the labor market.

Authors

Sharon Belli, PhD, Senior Research Expert, Ipsos European Public Affairs (Belgium)

Sharon Belli holds a PhD in Social Science from the University of Antwerp, with a focus on EU politics. She is currently a Senior Research Expert at Ipsos European Public Affairs, specializing in EU public opinion data analysis. Her expertise lies in interpreting complex datasets to extract meaningful insights and trends across a wide range of EU topics. In her role, she works on projects related to Employment and Social Affairs.