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This report provides updated evidence on the persistence of labour shortages amid declining levels of labour market slack in the EU and at Member State level. This serves as a background to the main focus of the report, which is on organisational policies aimed at attracting workers to occupations in which shortages are common. Case studies were conducted across sectors and Member States to gain an insight into how organisations deal with recruitment and retention challenges in a tight labour market. The report offers lessons on steps employers can take to fill vacancies, whether acting alone or in partnership with other organisations. It builds on previous Eurofound research that developed a taxonomy of actions employers adopt aimed at addressing labour shortages.

As economies begin to recover from the COVID-19 pandemic, labour shortages are becoming increasingly evident despite the impact of the war in Ukraine on energy and commodity prices. These include shortages exacerbated by the crisis in some sectors and professions where they had been endemic for some time. This report looks at measures implemented at national level to tackle labour shortages in the health, care, and information and communication technology sectors, as well as those arising from the twin green and digital transition. It assesses what measures are effective and explores the contextual factors supporting or hindering effective policy implementation and outcomes.

While unemployment is still a huge challenge in Europe, some countries, sectors and occupations are experiencing labour shortages. This report explores various approaches to identifying labour shortages and maps national policy debates around the issue. It documents public and social partner interventions to tackle labour shortages, such as measures fostering geographical or occupational mobility, addressing skills shortages and underinvestment in skills, improving working and employment conditions, and providing better matching procedures.

This report is based on the fourth edition of the European Company Survey (ECS), which was carried out jointly by Eurofound and Cedefop in 2019. It describes a wide range of practices and strategies implemented by European companies in terms of work organisation, human resource management, skills use and skills development, and employee voice. The report shows how these practices are combined and how the resulting ‘bundles of practices’ are associated with two outcomes beneficial to employees and employers: workplace well-being and establishment performance.

The analysis finds that the establishments that are most likely to generate this win–win outcome are those that combine a high degree of worker autonomy, a balanced motivational strategy, a comprehensive training and learning strategy, and high levels of direct employee involvement in decision-making, as well as offering managerial support for these practices. To boost the adoption of employee-oriented practices – particularly in relation to autonomy, skills and employee involvement – managers should be offered appropriate support, as they play a key role in the decision to initiate workplace change. They are also crucial to its success, as they must continuously support the workplace practices implemented.