To invest in labour markets means to invest in people

Most of the time, what stands in peoples’ way of finding a job is neither a lack of will nor a lack of skills. Rather, it is insufficient information about options or sheer hopelessness. To invest in labour markets means to invest in people, which in turn requires to focus on their needs.

Low-qualified adults (those who have not completed upper secondary education) are much more likely to be unemployed than their more educated counterparts. According to Eurostat data, in 2022 the unemployment rate was 12.2% for this group, while for those with tertiary education it was 3.8%.

What do low-qualified people need to gain better access to the labour market? Is it enough to invest in their skills?

“Investments in skills alone are insufficient for reintegrating low-qualified individuals into education or the labour market. In essence: Skills are necessary but not enough for success, particularly among students from disadvantaged backgrounds”, says Jani Erola, Professor of Sociology at the University of Turku.

“Skills alone have a very little impact on the prospects of the low qualified. Activation policies are key to bring them to education or the labour market”, says Heike Solga, Professor of Sociology at the Free University of Berlin and Director of the department “Skill Formation and Labor Markets” at the Berlin Social Science Center (WZB).

Activation policies means to encourage people to step up their job search, enhancing their motivation and providing incentives to seek employment. This can include training, job rotation and job sharing, employment incentives, supported employment and rehabilitation, direct job creation, or start-up incentives.

This Policy Brief offers recommendations which go beyond the narrow scope of “skills”. All recommendations are based on rigorous research from sociology and population studies. Beyond Education and Training – How Can We Adapt to Future Needs of Local Labour Markets? is part of the project Mapping Inequalities Through the Life Course, funded by the European Union.