DG Employment, social affairs and equal opportunities. Directorate-General for Employment, Social Affairs and Equal Opportunities Unit F3

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1 Comprehensive sectoral analysis of emerging competences and economic activities in the European Union Sectoral Social Dialogue Commerce 12 December 2008 DG Employment, social affairs and equal opportunities

2 Background Unit EMPL/F/3: Adaptation to change and working conditions Anticipation Preparation Management Develop and stimulate anticipative actions Exchange good practices Assist restructuring processes (anticipation, preparation, management) Comprehensive sectoral analysis of emerging competences and economic activities in the European Union

3 Project objectives and stages Objectives Identify emerging competences and future skills needs at sectoral level based on foresight methodology Provide recommendations to stakeholders Basis for future actions by other actors Collaborate with a maximum of partners 4 Stages Sectoral studies Validation of the results Diffusion of the information Follow-up

4 Stage 1 Sectoral studies methodology Sectoral studies Validation of the results Diffusion of the information Follow-up Step 2: Drivers of change Step 3: Scenarios of employment evolution Step 8: Recommendations Step 7: Education & training implications Step 1: Sector Mapping Step 4: Implications for employment and occupations Step 5: Emerging competences Step 6: Strategic choices

5 Stage 2: Validation of the Results Sectoral studies Validation of the results Diffusion of the information Follow-up Participation of social partners, Commission services (EMPL, ENTR, EAC, TREN, MARKT), other institutions and bodies (EP, CCMI, Eurofound, Cedefop) Studies to be discussed and validated during workshop of experts in selected sector

6 Sectors covered Experts Workshops 9&10/10/ &24/10/ &31/10/2008 3&4 /11/2008 6&7/11/ &21/11/2008 4&5/12/2008 8&9/01/ &23/01/ &30/01/2009 5&6/02/ &13/02/ &20/02/ &27/02/2009 5&6/03/ &13/03/2009 Sectors Textiles, wearing apparel and leather products Electricity, gas, water & waste Chemicals, pharmaceuticals, rubber & plastic products Electromechanical engineering Non-metallic materials (glass, cement, ceramic, ) Computer, electronic and optical products Building of ships and boats Printing & publishing Furniture and others Hotels, catering and related services Transport Post and telecommunications Distribution, trade Financial services Health and social work Other services, maintenance and cleaning

7 Overview of Commerce sector Sector coverage: Wholesale trade (Nace 51) Retail trade (Nace 52) Wholesale and retail trade of motor vehicles and motorcycles excluded from study In 2006: 43% of sector s value-added realised in wholesale trade, 40% in retail trade. 11.7% of EU GDP (12.2% in USA, 13.5% in Japan) 93% of sector value-added in the EU million jobs in sector, 55.4% in retail trade, 31.1% in wholesale trade Employment growth of 2.4% annually over (1.9% in old MS, 4.3% in new MS)

8 Employment change by region (% per annum)

9 Overview of Commerce sector (c td) 99.3% of enterprises <50 employees, 0.1% with >250 employees 60% of employment in small firms, 27.8% in large firms and 12.1% in medium-sized firms Important differences across Member States Importance of part-time job in the sector, entrepreneurs, women, young workers relative to other sectors (retail trade) Low-pay sector compared to others In 2006, in EU, 33% employed as service workers, 13% as clercks, 11% as managers of SMEs 57% of person employed with medium level education (ISCED level 3+4) in 2006 Increase power of retailers,integration of the wholesale function, outsourcing of logistics activities Disintermediation in supply-chain (e-commerce)

10 SWOT analysis in retail trade Strengths Efficiency Economies of scale : driven by concentration and search for growth Bargain power towards suppliers Retailer brands Focus on core activities, outsourcing of logistics, inventory management Advanced application and use of ICT tools Flexibility in workforce and employment is standard practice Weaknesses Low margins Despite bargaining power and economies of scale no improvement in economic / financial performance in relation to suppliers Gender inequality: many female employees, earning less than male employees Low pay low skills jobs Extreme labour flexibility: less motivated workers, poor service quality, unsatisfied customers Gap in labour productivity between USA and Europe

11 SWOT analysis in retail trade (c td) Opportunities More collaboration to increase economies of scale in sourcing, but also in marketing and sales Retail brands Cooperative brand development with suppliers Co-branding Experience-shopping Competition based on services and customer relations: improved profit margin Advanced customer relation management Full mass customisation Including productivity of consumers E-commerce: multi-channel strategies and sophisticated websites Location-based marketing RFID technology: more efficient supply chain management, self check-out, reduce theft, decrease out of-stock Green retailing Lifestyle changes Liberalisation of trade regulation and trade barriers, less restrictions on FDI Emerging markets: new markets, expansion of business Increasing income per capita Focus on service: different skills of workers, improved image of sector Focus on lean retailing: increasing productivity, lower costs, better service Threats Fierce international competition Constant search for growth: unfair practices of High Volume Retailers Focus on Price competition: race to the bottom Driven by e-commerce disintermediation of retailers: producers sell directly to consumers Brand-related experiences created by manufacturers: integrating retail function E-commerce: obstacles related to trust, efficient and reliable payment systems, reliable delivery of goods, average order sizes E-commerce: consumers becoming retailers (auctions and trading places) E-commerce: consumers better informed, reduced value of and need for retail employees Regulatory environment: restrictions on location, labour regulation, regulated shop opening hours: restrictive and not harmonised in EU Mature domestic markets Emerging markets: weak infrastructure, restrictions on FDI, location etc, political problems, economic imbalances, limited supply of qualified employees Cultural differences and local tastes can be barriers in global expansion Ageing of labour force: in retail large share of young workers, low pay High prices of natural resources in food High oil prices

12 Draft scenarios for the commerce sector

13 Diffusion and follow-up to studies Sectoral studies Validation of the results Diffusion of the information Follow-up Publication of results in May 2009 Large inter-institutional forum organised end 2009 Transversal analysis of skills needs across 16 sectors Feasibility of study on the setup of sectoral councils on employment and skills

14 Thank you very much for your attention! Contact: