European Skills Intelligence Observatory

This policy brief by the European Skills Intelligence Observatory (ESIO) highlights critical skills challenges facing the EU. Different sources of evidence point towards skills mismatches that are particularly acute in ICT, engineering, health and care, and skilled trades. These shortages diverge across countries, and tackling them requires different levels of education and training. Evidence shows that the supply side is not keeping up due to issues such as the decline in basic skills, teacher shortages, and a large untapped potential of working-age adults who remain outside the labour force or are unemployed or underemployed. In particular, STEM enrolment, which is instrumental for EU competitiveness, is not increasing in line with demand. This gap will widen unless the talent pipeline is broadened, especially for women. The brief also emphasises that AI adoption is reshaping demand for digital and transversal skills and tends to widen the skills gap, calling for effective lifelong learning policies in addition to adapted formal training programmes. The brief underscores the need for improved skills intelligence to address mismatches and future-proof Europe’s workforce.