Shortage of skilled workers reaches unprecedented dimension

Recruiting new staff for companies is increasingly becoming a major challenge. There is a shortage of skilled workers across all industries. In particular, positions for healthcare specialists, IT specialists and engineering specialists are currently very difficult to fill. This is shown by the Shortage of Skilled Workers Index of the Adecco Group Switzerland and the Job Market Monitor Switzerland of the University of Zurich.

Corona pandemic: a curse and a blessing for the Swiss labor market

The Corona pandemic has had a noticeable impact on the Swiss labor market over the past two years. The outbreak of the pandemic and the accompanying measures severely slowed down large parts of the economy in 2020 and 2021. Despite the introduction of broad-based economic support measures, as well as the expansion and simplification of short-time work compensation, the effects on the labor market were clearly felt. Unemployment figures shot up. At the same time, companies were looking for noticeably fewer staff, as can be seen from the decline in the Job Index. These two opposing effects resulted in the demand for skilled workers reaching a low in 2021.

It was not until access to vaccination and the gradual abolition of the measures that the need for consumption increased by leaps and bounds, both nationally and internationally. The strong economic upswing drove the number of job postings to new record levels at a rapid pace. Companies in all sectors needed significantly more staff in one fell swoop to meet the increased demand. The increased demand for personnel, in turn, caused unemployment figures to fall dramatically. While SECO still counted 120,294 unemployed in September 2021, this figure fell to 89,526 in September 2022. Even groups of the unemployed that usually have a longer placement period, such as 50-64 year-olds (-25.6%) and the long-term unemployed (-47%), benefited from the companies' thirst for personnel.

Record values wherever you look

Despite these findings, the sharp increase in the shortage of skilled workers is causing consternation among labor market experts: The Skilled Worker Shortage Index reaches a record 155 points this year; a value that has never been recorded before. Compared to 2021, the current index is a full 68% higher. Moreover, it exceeds the value of the pre-crisis year 2019 by 21%.

A look at the language regions shows that both German-speaking and Latin-speaking Switzerland achieved record levels, with the demand for skilled workers in German-speaking Switzerland (+77%) increasing significantly more than in Latin-speaking Switzerland (+48%). The difference in growth between the language regions is mainly due to the fact that German-speaking Switzerland suffered a significantly greater slump in demand for skilled workers at the beginning of the pandemic than Latin Switzerland. Thus, the labor market in German-speaking Switzerland had a significantly greater catch-up potential, which is now reflected in a stronger upswing.

"The Corona pandemic was a roller coaster ride for the Swiss labor market. While the demand for skilled labor initially reached an all-time low last year, it skyrocketed all the more rapidly to unprecedented levels this year. The retirement of the baby boomers and the discussion about re- and near-shoring of production activities due to global uncertainties are likely to cause the demand for qualified specialists to rise further. That's why companies are increasingly choosing their employees not the other way around," says Marcel Keller, Country Head Adecco Switzerland.

Greatest shortage of personnel among specialists in health care professions

Specialists in health care professions (e.g., medical specialists, specialized nursing staff and pharmacists) occupy first place in the shortage of skilled workers ranking. There was already a significant shortage of specialists in this occupational group before the pandemic. The shortage has also worsened since then. Corinne Scheiber, Head of Adecco Medical, states: "One reason for the worsening shortage of healthcare professionals is that Switzerland does not train enough specialized healthcare personnel to meet the actual demand for these professionals. In order to close this gap, a considerable part of the health personnel is recruited abroad. For example, according to the Swiss Health Observatory, the proportion of graduate nursing staff with a foreign diploma in Swiss hospitals and nursing homes was as high as 30 percent in 2019. The FMH physician statistics come to a similar conclusion with regard to physicians. Many healthcare professionals come from neighboring countries. In these countries, however, there is also an increasing shortage of healthcare specialists. The competition for these specialists has therefore intensified. Furthermore, Yanik Kipfer from Stellenmarkt-Monitor Schweiz states: "The increasing shortage of specialists is putting additional pressure on existing healthcare staff, as the workload is increasing due to the lack of personnel". Corinne Scheiber adds, "There is a noticeable frustration about the challenging working conditions and the slow implementation of the nursing initiative. As a result, many professionals are opting for temporary positions, which promise better pay and greater flexibility than permanent employment."

Second place goes to developers and analysts of software and IT applications (e.g., computer engineers, software developers, and systems analysts). Similar to specialists in the health care professions, this occupational group has been experiencing a significant shortage of skilled workers for several years, and this year the shortage has again intensified and reached an all-time high. James Peck, Vice President of LHH Recruitment Solutions Switzerland states, "Especially software developers:inside with experience in object-oriented programming languages such as, Java or C# and front-end software developers:inside with knowledge of Angular or React frameworks are currently desperately sought." It is somewhat surprising that the occupational group of information and communication technicians (e.g. web content managers, telematics specialists or e-commerce specialists) have lost eleven places this year. This is after the demand for skilled workers in this occupational group had risen sharply in 2021. Yanik Kipfer from the Job Market Monitor explains "Information and communication technicians:inside seem to have benefited from the corona-induced increased demand for e-commerce solutions. However, the e-commerce boom now seems to be returning to normal, as noted by the Swiss Retail Federation. This is also causing the demand for these professionals to stagnate."

Ongoing shortage of skilled workers in the industry

In addition to construction foremen, foremen and production managers, who occupy fourth place, industrial occupations are also clearly affected by a shortage of skilled workers. For example, engineering technicians and similar specialists (e.g. mechanical engineers, electrical engineers or process controllers in metal production) occupy third place, while polymechanics, production mechanics, machine mechanics and fitters occupy fifth place. The shortage of skilled workers in these occupational groups has increased considerably year-on-year. Yanik Kipfer of Job Market Monitor Switzerland notes, "The strong demand for skilled workers in industrial occupations shows that Switzerland continues to have a strong industrial base." James Peck, Vice President of LHH Recruitment Solutions Switzerland, further explains, "In order to withstand international competition for industrial products, Swiss industry has specialized in complex and technically demanding niche products, such as the production of precision tools, medtech or the development and construction of subsystems for aerospace. This results in various niche markets for industrial professions in which candidates with very specific skills are sought. These skills are difficult to transfer to other niches, making it difficult to find suitable skilled workers." Furthermore, Tom Vanoirbeek, VP of Adecco Workforce Solutions Western & Southern Switzerland, adds: "Especially in technical professions such as those in the watch industry, we are facing a significant skills shortage, which affects not only the highly skilled, but also the low-skilled professionals. Adecco Switzerland has therefore created the Watch Academy in Geneva to invest in new talent. The Watch Academy's mission is to train technically gifted individuals to become watchmakers, thus enabling them to enter this unique industry."

Occupational groups with an oversupply of skilled workers

There is not a shortage of skilled workers everywhere. At the bottom of the ranking are occupational groups in which there is an oversupply of skilled workers. In these occupations, more people are looking for a job than there are vacancies. In last place are unskilled workers, skilled workers in agriculture, forestry and fishing (e.g., assistant cooks, gardeners and parcel delivery workers), followed by managers, general office and secretarial workers and other office workers (e.g., data entry clerks, library assistants and proofreaders). For many occupational groups in the lower segment of the ranking, the demand for skilled workers dropped drastically with the outbreak of the pandemic. Nevertheless, it can now be observed that the shortage of skilled workers is also noticeably worsening for the occupational groups with a surplus of skilled workers. In other words, the situation for employees in these occupational groups is improving significantly compared with the previous year, as fewer job seekers are competing for the vacancies. At the same time, however, this means that it is becoming more difficult for companies to find suitable skilled workers, even in the occupational groups at the bottom of the ranking.

Source: Adecco Group