Why is Switzerland's chronic labour shortage worsening?
Switzerland doesn’t have enough skilled workers to fill the job vacancies. But if no remedies are found, the country’s economy will suffer, a new report shows.
The workforce scarcity is not a new phenomenon in Switzerland: finding qualified personnel in a number of sectors — including healthcare, IT, and technical trades — has become increasingly difficult in the past few years.
Currently, the shortage is “at its highest level in Switzerland,” according to a new report by the University of St. Gallen (USG).
And the situation is not expected to improve in the near future because the wave of retiring baby boomers will further aggravate the problem.
Just how dire is this situation?
As baby boomers continue to retire, they will create 340,000 vacancies by 2025.
And “even with moderate immigration of 50,000 skilled professionals per year, up to 400,000 positions could remain vacant by 2030", the report notes.
“Never before have so many positions remained vacant for so long,” the report found. “The skills shortage is perhaps the most important challenge in the Swiss labour market today.”
And the shortage comes — literally — at a high cost: due to huge gaps in the workforce, Swiss GDP suffers an annual loss of 0.66 percent, which corresponds to around 5 billion francs.
This means productivity suffers, affecting economic development and, consequently, prosperity as well.
What can be done to remedy the shortage?
Employers’ organisations have already taken steps to attract new employees, and retain old ones.
These measures include salary hikes (though trade unions claim they are not sufficient to offset inflation) and flexible work hours.
READ ALSO: What Swiss employers are doing to recruit hard-to-find staff
There are also other proposals under discussion.
For instance, Swiss Employers' Association recommends developing more childcare facilities, so parents are encouraged to work more hours.
It also wants the government to allow more immigrants from outside the EU / EFTA to come to Switzerland by better regulating the distribution of quotas for foreigners from third countries.
This particular suggestion has gained some political momentum in March, when MPs decided to allow non-EU / EFTA students who graduate from Swiss universities with a degree in a field suffering from a shortage of qualified professionals to remain in the country.
However, this proposal suffered a setback recently because legislators decided the measure would be difficult to implement from a constitutional point of view, and are currently seeking ways to create legal basis allowing them to enact this change.
READ ALSO: Why has the move to let non-EU graduates stay in Switzerland stalled?
As for the USG report, it put forth a suggestion to solve the problem as well.
It pointed out that the shortage could be alleviated if more women entered the labour market.
"While the demands and needs of the job market have evolved rapidly, our societal structures still resemble those of the 1950s: men work full-time, and women reduce their workload once a family is formed. This, despite achieving educational parity, is increasingly burdening the Swiss economy and can be considered one of the reasons for the skills shortage,” the USG said.
By putting an end to this situation, Switzerland could fill “several hundred thousand” jobs in Switzerland, the report added.
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The workforce scarcity is not a new phenomenon in Switzerland: finding qualified personnel in a number of sectors — including healthcare, IT, and technical trades — has become increasingly difficult in the past few years.
Currently, the shortage is “at its highest level in Switzerland,” according to a new report by the University of St. Gallen (USG).
And the situation is not expected to improve in the near future because the wave of retiring baby boomers will further aggravate the problem.
Just how dire is this situation?
As baby boomers continue to retire, they will create 340,000 vacancies by 2025.
And “even with moderate immigration of 50,000 skilled professionals per year, up to 400,000 positions could remain vacant by 2030", the report notes.
“Never before have so many positions remained vacant for so long,” the report found. “The skills shortage is perhaps the most important challenge in the Swiss labour market today.”
And the shortage comes — literally — at a high cost: due to huge gaps in the workforce, Swiss GDP suffers an annual loss of 0.66 percent, which corresponds to around 5 billion francs.
This means productivity suffers, affecting economic development and, consequently, prosperity as well.
What can be done to remedy the shortage?
Employers’ organisations have already taken steps to attract new employees, and retain old ones.
These measures include salary hikes (though trade unions claim they are not sufficient to offset inflation) and flexible work hours.
READ ALSO: What Swiss employers are doing to recruit hard-to-find staff
There are also other proposals under discussion.
For instance, Swiss Employers' Association recommends developing more childcare facilities, so parents are encouraged to work more hours.
It also wants the government to allow more immigrants from outside the EU / EFTA to come to Switzerland by better regulating the distribution of quotas for foreigners from third countries.
This particular suggestion has gained some political momentum in March, when MPs decided to allow non-EU / EFTA students who graduate from Swiss universities with a degree in a field suffering from a shortage of qualified professionals to remain in the country.
However, this proposal suffered a setback recently because legislators decided the measure would be difficult to implement from a constitutional point of view, and are currently seeking ways to create legal basis allowing them to enact this change.
READ ALSO: Why has the move to let non-EU graduates stay in Switzerland stalled?
As for the USG report, it put forth a suggestion to solve the problem as well.
It pointed out that the shortage could be alleviated if more women entered the labour market.
"While the demands and needs of the job market have evolved rapidly, our societal structures still resemble those of the 1950s: men work full-time, and women reduce their workload once a family is formed. This, despite achieving educational parity, is increasingly burdening the Swiss economy and can be considered one of the reasons for the skills shortage,” the USG said.
By putting an end to this situation, Switzerland could fill “several hundred thousand” jobs in Switzerland, the report added.
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