Head of Badenoch & Clark
In 1847 the Swiss military briefly fought a small civil war. It lasted less than a month and fewer than 100 lives were lost. This was Switzerland's last proper military conflict. Since then the country has largely enjoyed peace. Yet, there is one battle Switzerland continues to fight – the war to secure talent.
Switzerland you see, has long had a skills shortage. This means there are more vacancies than jobseekers. Of course, it depends where you look across the country and for which professions. There will be greater demand for certain positions in different regions, which reflects the economy of that local area. Yet there will also be some skills that are in constant demand, regardless of where you are in the country, such as engineers, fiduciary professionals, technicians, pharmaceutical workers, IT specialists and technical draughtmen.
To complicate matters, we are now in the middle of a pandemic. The rise in unemployment and huge disruption it has caused the recruitment industry, might give the illusion that the talent shortage is over.
In truth, the skills shortage in Switzerland is a complex issue: it cannot be simplified or easily rationalised. So, every year the Adecco Group releases the results of the Swiss Skills Shortage Index, which tracks where shortages or surpluses are occurring in Switzerland at a national and regional level. I thought the findings this year were incredibly interesting.
What we saw was a tale of two worlds
When the lockdown began in March, many companies had to freeze hiring. In many instances, this wasn’t just because the lockdown was hurting business. A lot of companies still needed to hire talent as part of their long-term business goals.
The problem they faced was that the pandemic’s impact could not be immediately quantified. The business risk from the coronavirus when it emerged was completely unknown. Businesses, therefore, had no choice but to reduce risk, stop hiring and protect their cashflows. The result was a 17% decline in job listings in Switzerland in comparison to2019.
Initially, this meant there were more candidates competing for jobs as unemployment rose in Switzerland from 2.5% in February to 3.4% in May. This level of unemployment has since persisted and stands at 3.2% as of October.
Ironically, there is still a skills shortage. Rising unemployment and the decline in recruitment isn’t a reflection of a talent surplus. Companies were forced to cutback and once the pandemic has passed, they will need to resume hiring to meet their long-term goals.
Switzerland’s skill shortage persists
There is still a national shortage inengineers, IT and medical workers. Companies in these industries continue to search intensively for specialists in these fields. In some instances, the pandemic actually increased recruitment for some highly specialised roles, such as system quality engineers in the medical technology sector.
Another trend which is developing is that some candidates are less willing to search for new roles, if they are not already unemployed. This has been the case for even those who might be unhappy in their current jobs.
The reason for this lack of mobility is simple. Changing jobs during a period of economic uncertainty poses a risk, especially if you are already established in your current job. If you change roles and it doesn't work out, it can be difficult to find an alternative position quickly.
What does the skills shortage mean for Switzerland's economy?
The skills shortage poses a challenge for Switzerland. The risk of having so many unfilled vacancies is that it can hamper long-term economic growth. Although, this has long been a problem, the risk we face today is complacency on this issue.
This is because the pandemic has diverted attention away from this issue and towards the rise in unemployment. Although this is a problem, it is a trend that will resolve itself once the pandemic has passed. Right now, companies need to think ahead and plan for the great rehiring in 2021. When this starts, competition to secure talent will be fierce.
It is, therefore, time to go on a hiring offensive.