COVID-19 and the Demand for Labor and Skills in Europe: Early Evidence and Implications for Migration Policy

The European Union and several of its Member States have in recent years launched policies designed to increase the demand for and supply of skilled workers in Europe. This includes educating or attracting non-EU workers with in-demand digital skills and those with the expertise needed to further other policy aims, such as the European Union’s Green Deal. These were already ambitious goals before the COVID-19 pandemic hit, heralding an economic recession and high levels of unemployment.

Weathering this crisis and setting the stage for a speedy recovery are now top priorities for policymakers across Europe. Yet longer-term labor market trends linked to technological developments and demographic shifts in some countries—as residents age and older workers leave the workforce—remain important, even as pandemic-related labor market disruptions and constrained national budgets may make pursuing policies to adapt to these changes more difficult.

This MPI Europe issue brief explores how the pandemic is shaping the demand for workers and skills in the European Union, and how policymakers can respond to these trends. It also considers how leaders can keep one eye on Europe’s longer-term skills needs. Among its recommendations are investments in education and training systems; in measures that ensure migrants living in Europe are able to successfully integrate into the labor market and apply their skills; and in data-driven, transparent mechanisms to detect where resident workers are unable to meet labor demands and migration from beyond the European Union may be needed.