SAV employment barometer predicts persistent shortage of skilled workers

On January 24, 2023, the Swiss Employers' Association presented the current SAV Employment Barometer. This is based on current economic data from the KOF economic research institute, BAK Basel and Seco. Accordingly, the initial situation is as follows: With a value of 92.2 points in December, the KOF economic barometer is still well below the longer-term average. At the end of 2022, it rose again by three points for the first time in several months. The domestic economy continues to have a stabilizing effect on the economy, in particular due to continued robust private consumption. The situation is more difficult in parts of the export-oriented industry, where economic difficulties are being felt in the sales markets. The global energy crisis, weakening domestic demand as a result of declining purchasing power and continuing supply bottlenecks are still causing problems for companies in these countries. At the same time, the catch-up effects resulting from the Corona pandemic are gradually leveling off. In the MEM industries in particular, lower exports to important sales countries are having a negative impact, and high energy prices are causing problems for energy-intensive companies in particular. According to the KOF economic forecast, Switzerland's gross domestic product (GDP) will still grow by 0.7 percent in the current year despite the global economic slowdown - in contrast to other European countries, whose economies will actually shrink.

SAV employment barometer shows chronic shortage of skilled workers in certain sectors

Analysis of the KOF survey, which provides an important basis for the SAV Employment Barometer, shows that the majority of companies surveyed still assess both the business situation and employment positively, albeit somewhat less euphorically than in the second half of 2022. With regard to employment in particular, companies in many sectors indicate that they expect to expand their workforce in the future. This is particularly true of the service sector. However, according to the SAV Employment Barometer, assessments of employment trends in the MEM industries show that the proportion of companies expecting to expand their workforce decreased in the last two quarters of 2022. Nevertheless, the challenge of finding suitable staff remains: A logjam of job openings has built up in the post-Corona pandemic period, and demographic trends and the exit of the baby boomer generation from the labor market are contributing to the labor shortage. The major shortage of skilled workers in the IT sector is almost described as "chronic". According to the KOF survey, around one in two companies say that the lack of suitable staff is having a negative impact on their earnings situation.

Better exploitation of domestic labor potential

Even if there are signs of a cooling of the economy and this leads to a normalization of the labor market, the problem of the lack of skilled workers is not off the table. To alleviate the situation, priority must be given to better exploiting the labor potential available at home, but labor market-oriented immigration remains indispensable on a subsidiary basis, even though our neighboring countries are also suffering from an increasing shortage of skilled workers. Hendrik Budliger, founder and head of the Demographics Competence Center, has conducted an in-depth study of population trends in Switzerland and the most important immigration countries. He concludes that the scenarios assuming constant or even increasing migration are too optimistic. According to his calculations, the number of employed persons in Switzerland will decline from 2025 onward, despite immigration. Employers see this as all the more confirmation of their efforts to strengthen the domestic workforce potential. According to Roland A. Müller, Director of the Swiss Employers' Association (SAV), a comprehensive package of measures is needed. For example, he calls for an increase in working hours and work volume. On average, the working population is working almost 14 days less than 10 years ago, Müller said. "To counter the shortage of skilled workers, we need to increase the volume of work instead of thinking about further reductions. Especially mini-staff positions below 40 percent need to be addressed." Second, he said, work must become more rewarding again, including through tax incentives. The "marriage penalty", i.e. the unequal tax treatment of married couples compared to individuals, should be abolished and individual taxation introduced, continued Roland A. Müller. And thirdly, Müller calls for investment in childcare so that it is also easier for mothers or fathers to increase their workloads if they so wish.

Source: Swiss Employers' Association