Digitalisation and the Belgian labour market. Shaping the future of work

Transcription

1 Digitalisation and the Belgian labour market Shaping the future of work

2 Table of contents A first for Belgium and Europe 1 What you absolutely should know The labour market through to Four strategies for a sustainable labour market From study to action: a programme for the future Shaping the Future of Work is a study performed by Agoria in cooperation with VDAB, Forem and Actiris and created by Roland Berger on behalf of Agoria Agoria - September 2018 The content of this study shall not be published, reproduced, translated or adapted in whole or in part in any format and shall not be stored in an automated data file without Agoria s express prior consent. Agoria does authorise the publication of this study (for non-commercial purposes), provided that the source is acknowledged (and distribution is free). Agoria makes every effort to ensure that the information in this study is as complete, accurate and up-to-date as possible, but cannot guarantee that the provided information is free from shortcomings. Agoria shall not be held liable for any damage resulting from incorrect information in the study or arising from the use of this information. Are robots making human labour superfluous? Will digitalisation lead to job losses? Everyone knows that the way we supply our products and services is undergoing massive changes but, until now, the impact of these dynamics on the labour market has never been accurately measured. Agoria has worked with regional employment agencies VDAB, Forem and Actiris and used a tool developed especially by Roland Berger to obtain a detailed overview of the upcoming evolution in the national labour market: the first of its kind in Europe. Shaping the Future of Work presents the results of the analysis and recommendations. A summary of this publication is provided in this booklet. We now know the major trends on the national labour market through to 2030 and the evolution for each region, sector and job profile. Shaping the Future of Work also provides an overview of the digital competencies and related skills people will need on the labour market in the coming years. The overview is based on interviews with more than 60 experts and well-informed observers. The labour market is transforming fast and this affects everyone. Fortunately, we have the opportunity to approach this transformation with confidence, even though adjustments must be made. To this end, we provide a number of recommendations grouped into four employment development strategies. We would also like to make an appeal: Let us all implement these recommendations together people in politics, education, business, everyone. Let us be the change! Marc MARC Lambotte JEAN CEO Agoria DIGITALISATION AND THE BELGIAN LABOUR MARKET I 3

3 1 I WHAT YOU ABSOLUTELY SHOULD KNOW 1 What you absolutely should know Digitalisation has a major impact on the labour market. Some 4.5 million workers will have to upgrade their skills regularly. Some jobs will disappear and others will change. But above all, many new vacancies will arise. If we fail to take action, as many as 584,000 Belgian vacancies will remain unfilled in This means we would miss out on 60 billion of additional GDP in Additionally, 310,000 workers and unemployed people will require retraining for a new, sustainable job. If this is done, we will avoid job losses with a GDP value of 35 billion. By 2030, a total of 95 billion (16.5% of the Belgian GDP) will be in the balance. 4.5 million WORKING PEOPLE NEED TO UPGRADE THEIR SKILLS 584,000 UNFILLED VACANCIES IN BELGIUM IN ,000 WORKERS AND UNEMPLOYED PEOPLE IN RETRAINING 95 billion of GDP ADDITIONAL ADDED VALUE 4 I DIGITALISATION AND THE BELGIAN LABOUR MARKET DIGITALISATION AND THE BELGIAN LABOUR MARKET I 5

4 1 I WHAT YOU ABSOLUTELY SHOULD KNOW 1 I WHAT YOU ABSOLUTELY SHOULD KNOW Shifts in the labour market The ideal candidate of the future will be the result of co-creation, not recruitment: companies will have to offer resources and clear paths DECLINING CHANGING INCREASING NEW allowing candidates to n Unskilled manual labourer n Cashier and counter clerk n Administrative clerk n Sales representative n Shop assistant n Production operator n Nursings and caring staff n Digital expert n Scientist and engineer n Mobility planner n Consumption coach n Information filtering, processing and security develop, and candidates will have to be motivated and willing to invest their time! Jeroen Franssen Lead Expert Talent and Labour Market Agoria 6 I DIGITALISATION AND THE BELGIAN LABOUR MARKET DIGITALISATION AND THE BELGIAN LABOUR MARKET I 7

5 2 I DE ARBEIDSMARKT TOT I THE LABOUR MARKET THROUGH TO The labour market through to 2030 The digitalisation and economic dynamics that have already started will certainly lead to job losses. However, for every job that is lost in the future, there will be 3.7 new ones. The demand for workers will exceed the supply as of The gap between supply and demand will continue to grow until at least The content of many jobs will also change in the period through to 2030, making further education and retraining necessary. Not one industry in the Belgian economy will escape the consequences of digitalisation, but the impact will be different on each sector. We already know the extent of the effect. More jobs available Between now and 2030, the demand for labour in Belgium will increase by 0.9% every year. This means that by 2030, total labour demand will increase by 629,000 jobs. The service industry, education and healthcare will experience the most significant increases. Today, these sectors show a relatively low digitalisation rate. Patrick Slaets Chief Data Analyst Agoria 8 I DIGITALISATION AND THE BELGIAN LABOUR MARKET DIGITALISATION AND THE BELGIAN LABOUR MARKET I 9

6 2 I THE LABOUR MARKET THROUGH TO I THE LABOUR MARKET THROUGH TO 2030 CURRENT LABOUR DEMAND (2016) EVOLUTION OF LABOUR DEMAND ( ) % of total employment Vacancy rate (% of employed people) STEM/ICT employees (% of employed people) 2016 labour demand: employment and vacancies in thousands , , TOTAL ,777, ,000 1,267,000 Growth in demand , ,000 Job losses by ,000 Job gains by ,406, ,000 1,412,000 Labour demand annual growth percentage +0.6% +0.8% Vacancies Employment Services to companies and individuals Wholesale and retail Healthcare Public sector Education Construction Transport and logistics Metal and electrical engineering Food, textile, woodwork and construction Catering Financial sector ICT Chemicals and pharmaceuticals Media and digital entertainment Agriculture Utilities 2,798,000 Labour demand ,220,000 Labour demand % +0.9% Higher than average share Source: National Bank of Belgium, Statbel, Forem, VDAB, Actiris, Agoria, Roland Berger Source: National Bank of Belgium; Federal Planning Agency; CEDEFOP; Agoria; Roland Berger 10 I DIGITALISATION AND THE BELGIAN LABOUR MARKET DIGITALISATION AND THE BELGIAN LABOUR MARKET I 11

7 2 I THE LABOUR MARKET THROUGH TO I THE LABOUR MARKET THROUGH TO 2030 LABOUR DEMAND PER SECTOR ( ) -32,000 Annual labour productivity growth (in %) Agriculture Chemicals and pharmaceuticals Media and digital entertainment Metal and electrical engineering Food, textile, woodwork and construction Public sector Financial sector Catering Utilities ICT Wholesale and retail + 151,000 Transport and logistics Construction Education Services to companies and individuals + 510,000 Healthcare Annual labour demand growth (in %) Source: National Bank of Belgium; Federal Planning Agency; CEDEFOP; Agoria; Roland Berger 12 I DIGITALISATION AND THE BELGIAN LABOUR MARKET DIGITALISATION AND THE BELGIAN LABOUR MARKET I 13

8 2 I THE LABOUR MARKET THROUGH TO I THE LABOUR MARKET THROUGH TO 2030 Limited inflow of labour supply As demand for jobs rises by 0.9% annually until 2030, labour supply increases by only 0.3% annually in the same period. This growth in supply is mainly due to the outflow from LABOUR MARKET INFLOW AND OUTFLOW ( ) 4,900,000 Unemployment 250,000 Employment 4,650,000 education. Other factors such as migration play only a limited role. From 2021, the inflow will therefore no longer be sufficient to meet the growing demand for labour. -1,670,000 +1,730,000 Outflow due to retirement Inflow of school leavers +160,000 Migration -50,000 Other factors - Death - Incapacity for work + Employment activation Measures must be taken to fill these vacancies. This forecast takes into account the gradual increase of the retirement age to 67 in Labour supply 2016 Labour supply ,070,000 Source: National Bank of Belgium; Federal Planning Agency; CEDEFOP; Agoria; Roland Berger 584,000 unfilled jobs by 2030 On average, one in 10 vacancies in Belgium (11%) is at risk of not being filled in 2030 due to insufficiently adapt- ed competencies and a structural shortage of workers. However, there are clear differences between the regions and sectors. Flanders (12%) and Brussels (10%) are most at risk and Wallonia (7%) the least. The healthcare (18%), ICT (18%) and education (13%) sectors will experience the most difficulties filling vacancies. This is mainly due to an increasing demand for employees and the limited influx of graduates. 1 in 10 If we do nothing, 1 in 10 vacancies will not be filled in SECTORS FOR WHICH THE NUMBER OF UNFILLED VACANCIES IS PARTICULARLY ON THE RISE 18% Healthcare 18% ICT 13% Education 14 I DIGITALISATION AND THE BELGIAN LABOUR MARKET DIGITALISATION AND THE BELGIAN LABOUR MARKET I 15

9 3 I FOUR STRATEGIES 3 Four strategies for a sustainable labour market The previous section provided a concise macroeconomic analysis of the national labour market and identified some differences between regions and sectors. Agoria has also conducted a microeconomic analysis of 75 job profiles. This comprehensive approach has allowed us to make concrete labour market recommendations through to 2030 and to implement the right measures in advance together with all stakeholders. We have grouped the recommendations into four strategic categories: Upgrading Retraining Activation Productivity Skills upgrading, retraining and activation alone are not sufficient to fill all vacancies. A further rise in productivity is necessary to compensate for the demand for jobs. 16 I DIGITALISATION AND THE BELGIAN LABOUR MARKET DIGITALISATION AND THE BELGIAN LABOUR MARKET I 17

10 3 I FOUR STRATEGIES 3 I FOUR STRATEGIES DIGITAL SKILLS INDICATOR BY PROFILE FOR (IN % OF SKILLS) STRATEGY 1 STRATEGY 2 Upgrading the skills of all employees ACTION 1 I Proactively upgrade the digital and accompanying skills of 4.5 million workers The digitalisation and economic dynamics will have an impact on the content of almost all jobs at all levels. The average required level of digital competencies is increasing everywhere, and the required level of general skills is also on the rise. Almost all workers will feel the wind of change x 1.2 x 1.4 x 1.3 x Labourers Administrative & technical personnel Experts Managers Retraining workers and the unemployed ACTION 2 I Targeted communications on opportunities on the labour market 3 I Develop professional retraining programmes for the unemployed 4 I Launch retraining programmes for job profiles that are at risk 5 I Facilitate travel between regions 6 I Increase labour market flexibility and implement changes to the social security system to make it easier for people to switch to a sustainable job 310,000 (working and unemployed) people must be retrained by 2030 to ensure they have sustainable jobs. Agoria proposes five measures to achieve this. Some people (150,000) will need moderate retraining that takes two to six months. Others (160,000) require intensive retraining during six to eighteen months. It will be essential to always think in terms of the team. The team of the future will include human co-workers, but also artificially intelligent robots and cobots. Mieke Vermeiren Chief Expert Talent and Labour Market Agoria Source: Roland Berger 18 I DIGITALISATION AND THE BELGIAN LABOUR MARKET DIGITALISATION AND THE BELGIAN LABOUR MARKET I 19

11 3 I FOUR STRATEGIES 3 I FOUR STRATEGIES STRATEGY 3 Employment activation 584,000 vacancies will not be filled in 2030 if we fail to implement the necessary measures. To meet this high demand for workers, people will need to be activated as much as possible. The Shaping the Future of Work analysis indicates that 268,000 vacancies will be filled through activation. In Shaping the Future of Work, Agoria proposes various activation measures. We have divided these into four categories: I Activating the unemployed II Encouraging economic migration III Working more hours and/or working longer IV Ensuring study programmes and students choices are more in line with labour demand I Activating the unemployed ACTION 7 I Increase the financial difference of people working and not working 8 I Make it easier to achieve work-life balance 9 I Increase the employability of unskilled workers through technology 10 I Improve access to employment for people with an immigration background 11 I Adjust the working conditions of workers over 55 and make their pay less dependent on seniority and more dependent on their market value 12 I Accelerate the phasing out of the early retirement system The implementation of the above six action items will fill 193,000 vacancies. II Fuelling economic migration ACTION 13 I Attract economic immigrants specifically for high-demand jobs Proactive economic migration will fill 29,000 vacancies. Economic migration is particularly useful as a solution for specific sectors with the highest number of vacancies, such as healthcare and ICT. Below you will find some job profiles that can be partially filled by stimulating economic migration and a forecast of the total number of vacancies in Sector Job Vacancies Healthcare Nurse 73,000 Cross-sector Digital expert 53,000 Services Cleaner and domestic help 16,000 ICT Software developer and IT business consultant 15,000 Cross-sector Engineer 14, I DIGITALISATION AND THE BELGIAN LABOUR MARKET DIGITALISATION AND THE BELGIAN LABOUR MARKET I 21

12 3 I FOUR STRATEGIES 3 I FOUR STRATEGIES III IV Working more and/or working longer ACTION 14 I Offer incentives to work more and/or work longer 15 I Encourage taking on specific roles, such as coaching/ training at the end of a career At least 15,000 vacancies can be filled by giving people who are approaching the end of their careers the opportunity to work longer. Incentives to extend careers are particularly useful in education and for specific crosssector profiles, such as technicians. In certain sectors and for certain profiles, alternative work may encourage people to extend their careers. Please find below some job profiles that can be partially filled by encouraging people to work longer and a forecast of the total number of vacancies in Sector Job Vacancies Cross-sector Technician 29,000 Education Teacher in nursery and primary education Teacher in secondary education 27,000 16,000 Cross-sector Carer 6,000 Below are some job profiles that can be partially filled by encouraging people to work more and a forecast of the total number of vacancies in Sector Job Vacancies Healthcare Doctor 20,000 Cross-sector Digital expert 53,000 Transport & logistics Mechanic 3,000 Metal & electrical engineering Electrical engineer 4,000 Ensuring that study programmes and students choices are more in line with labour demand ACTION 16 I Inform students better on labour market evolution 17 I Introduce financial and other mechanisms to encourage young people to choose courses that are geared towards the future 18 I Increase the budget for STEM study programmes 19 I Give digital and related skills a more prominent place in all study programmes If students should choose fields of study that are in demand at companies more frequently, 31,000 vacancies could be filled. To achieve this, a wide range of measures is needed. Students should be informed better and targeted measures can be taken to reward favourable study choices. In view of the existing demand for STEM profiles, the budget for STEM programmes should be increased and digital and related skills given a more prominent place in all fields of study. The positive prospects of our study provide a favourable climate for taking effective measures. This means we can promote the evolution of skills that digitalisation requires. Bart Steukers Director, Project Manager Shaping the Future of Work Agoria 22 I DIGITALISATION AND THE BELGIAN LABOUR MARKET DIGITALISATION AND THE BELGIAN LABOUR MARKET I 23

13 3 I FOUR STRATEGIES 3 I FOUR STRATEGIES RESULTS OF STRATEGIES 3 & 4 STRATEGY 4 Increase productivity ACTION 20 I Reduce labour demand through accelerated digitalisation, particularly in education, healthcare and service sectors Only some of the 584,000 unfilled vacancies can be filled through employment activation. There will still be 316,000 job vacancies after activation. A more intensive increase in productivity is therefore required. The easiest way to achieve this is to speed up automation and digitalisation in the sectors with the highest number of vacancies. 584,000 Total number of unfilled vacancies 268, , , Activation increases labour supply Productivity increase reduces labour demand Natural vacancies By increasing productivity, we can respond to 208,000 extra jobs. Of the 584,000 unfilled vacancies, 108,000 will remain, which is 2% of the active labour force in We regard this as the natural vacancy rate. This can be achieved by accelerating automation and digitalisation in sectors which have the highest number of vacancies. 24 I DIGITALISATION AND THE BELGIAN LABOUR MARKET DIGITALISATION AND THE BELGIAN LABOUR MARKET I 25

14 4 I VAN STUDIE TOT ACTIE: EEN PROGRAMMA VOOR DE TOEKOMST 4 I FROM STUDY TO ACTION: A PROGRAMME FOR THE FUTURE 4 From study to action: a programme for the future The far-reaching changes in the labour market outlined briefly in this summary require a joint approach. After all, work in the future is of interest to everyone: governments, companies and federations, educational institutions, those who are working and those who are not. Be the change Agoria wants to investigate other potential measures in a dialogue with all stakeholders to make the most of opportunities that present themselves. Be the change calls on everyone to come up with ideas and actions for the work of the future. The programme will include debates, workshops and training courses. > Follow us at: Request a presentation Agoria offers customised presentations on Shaping the Future of Work with the most relevant findings and recommendations for your region, sector or company. We also have a general introductory presentation with the content provided in this summary. > Contact Jeroen Franssen: jeroen.franssen@agoria.be to request the presentation you need. 26 I TELECOM, DIGITALISATION SOCIETY AND AND THE ECONOMY BELGIAN LABOUR IN BELGIUM MARKET DIGITALISATION AND THE BELGIAN LABOUR MARKET I 27

15 This is a summary of Shaping the Future of Work. The first thorough study of the Belgian labour market through to 2030 n Trends for Belgium, the three Belgian regions, 16 business sectors and 75 job profiles n Quantitative and qualitative forecast n Job losses, gains and trends n Number of vacancies and unemployment per region, sector and profile n Inflow and outflow of workers n Gap between supply and demand n Digital skills for the future n Recommendations and call for action and cooperation Responsible publisher: Agoria vzw, Reyerslaan 80, 1030 Brussels, Belgium