Net-Zero Goals, Skilled Hands: Meeting Europe's Labour Challenge

As Europe advances towards a greener future, a plethora of qualified professionals will be essential to driving this change. It is not only engineers and visionary manufacturers that are required; electrical and mechanical contractors, responsible for handling electrical and mechanical installations are equally crucial. Consider, for instance, your local electrician or plumber. These professions encompass millions of workers, many of whom operate within small companies or as independent contractors, although there are also a few major players. Their roles are evolving rapidly as they integrate advanced technologies such as solar panels, heat pumps, and electric vehicle chargers, all the while adapting to the widespread electrification of society. However, a pressing issue remains: how will these professions find enough qualified workers to meet the rapidly growing demand for buildings and infrastructure fit for the energy transition? This worrying yet exciting question is dealt with together at European level by their respective associations EuropeOn (representing electrical contractors) and GCP Europe (representing HVAC and plumbing contractors).

Solar Impulse : Nowadays, numerous sectors across the economy are experiencing worker shortages. Why, then, should we be particularly concerned about the electrical and mechanical installation professions?

EuropeOn : We all know that Europe has committed to follow the path of a green and digital energy transition, and this was confirmed with Commission President Ursula Von der Leyen’s recent re-election. Also, enabling Europeans to live in a comfortable, affordable, and safe manner is essential. But this change cannot emerge if nobody makes it happen concretely. Unlike many other activities, electrical and mechanical installations are directly responsible for deploying the advanced technologies that will reduce carbon emissions and improve energy efficiency. Our members operate at the very end of the value chain, bringing these clean technologies into homes, offices, public administrations, leisure facilities, and infrastructures. Whether installing solar panels on roofs or implementing efficient heating solutions, competent professionals are a must.

It means that the shortage of skilled workers in our professions poses a significant risk to achieving industrial and environmental targets and hampers the overall progress towards a sustainable and competitive economy.

Another compelling reason to cast a light on the workforce shortages we report is that we have remarkable career opportunities to offer. The energy transition is a long-term process, making our jobs not only fast-evolving, but also secure in the long run. There will always be demand for electrical and mechanical professionals, who often secure a job even before graduating. New technologies make these professions dynamic and highly qualified. Our field should appeal to students who wish to make a tangible contribution to combating climate change and/or possess an entrepreneurial spirit. For instance, one can start a business to equip homes with heat pumps connected to solar PV systems.

Finally, our jobs are not relocatable: we provide essential services in buildings and infrastructures across European territories, in both urban and rural areas.

This all seems like great arguments to join such trades, so why is it not happening?

GCP Europe: It IS happening. Electrical and mechanical contractors are actively engaged in the green and digital transition and their market keeps growing. The solutions offered to end-users are also already following the path of technological evolution. New businesses are emerging and new workers are getting trained and up or re-skilled. But this change is too slow.

Three major issues are impeding the needed acceleration: cultural, educational and economic issues.

On the cultural side, electrical, mechanical and HVAC jobs lack the needed attractiveness to recruit enough new motivated workers. This can be observed across the whole of Europe and is linked to the deeply engrained belief that technical studies and jobs are “relegation paths” in professional development. This belief pushes many parents (and teachers!) to direct young people away from our professions and has lasting damaging effects.

On the educational side, this belief is strengthened and materialised: technical schools and programmes are often obsolete, drop-out rates are high, teachers get lower pays than in academia.

On the economic side, the services our professions provide are of essential nature for individuals and businesses. Consequently, the demand from end-users is naturally very strong. Due to the other issues mentioned above, a structural gap has already been created with a too low supply under normal market conditions. As more and more end-users are willing to surf the transition wave, this gap keeps getting bigger. This gap is set to widen even further if demand aligns with the ambitious climate and energy targets adopted at EU level.

What (if anything) can policymakers do to improve this situation?

EuropeOn : The most important is that policymakers start to acknowledge the gravity of the situation and make the resolution of this issue THEIR priority. Both the status quo and policies leading to marginally improved market conditions (through the wishful involvement of other market players) will not allow them to meet the climate and energy goals that they have committed to. Furthermore, they should see this challenge as an opportunity to create long-term, essential jobs.

Then, they need to address the cultural, educational and the economic causes that we presented.

The needed cultural change requires a change of mindset from students, parents and teachers, which means it is a long-term endeavour that needs to be started now. Making electrical, mechanical and HVAC jobs more appealing to potential workers would mean repeatedly conveying new positive messages on our career paths (possibly linking them to aspirations of becoming champions of the green and digital transition) across all the layers of the education system (from kindergarten to higher studies) and the job-seeking system. This would require the collaboration of policymakers at all levels. This task could be supported by a clear shift in the public communication carried out by authorities, highlighting the genuine importance of our professions and granting financial support to set up or scale up relevant promotional campaigns.

Technical education must become a real alternative to academia with updated curricula and financial means to provide state-of-the-art equipment and better paid teachers that will train students on the latest innovations.

On the economic side, policymakers can trigger quicker results. For that to happen, they must not only consider the demand side but also, equally, the supply side. For too long, policymakers have hoped that stimulating the demand (for instance, though financially supporting end-users) would naturally boost the supply. Unfortunately, as explained above, the supply has only grown more slowly and now the gap between supply and demand has tremendously increased. 

OK, so how could policymakers support the supply side then?

GCP Europe : First, by initiating or supporting a quantified assessment of the workforce needs to comply with the legally established climate and energy targets, country by country. This exercise will be instrumental to reform education and training. Such an endeavour is already foreseen in the revised Energy Efficiency Directive[1], but must be mainstreamed to all relevant areas for an effective implementation of the Green Deal objectives.

Second, by improving our professions’ business environment, making certain reporting obligations less time-consuming and less costly, especially to our smaller companies. For instance, well-designed digitalisation policies can help our companies fulfil their ESG reporting obligations more efficiently and inform end-users on the performance of their installations more accurately. Such policies would accompany, rather than undermine, the productivity of our companies.

Finally and most importantly, policymakers need to build their financial support mechanisms towards the supply side. This could be done in various ways but should aim at incentivising installation companies to provide the services the most in line with the achievement of the climate and energy targets. Nowadays, our companies’ order books are full a year in advance, so they have little time and imperative to up-skill.

Support must be well directed. A common flaw that we increasingly witness it the  promotion of a myriad of new training schemes going in all directions. On the one hand, they often produce highly specialised profiles (“quick fixes”) that are not very attractive, are easily disposable, and sometimes lead to situations where people are not competent enough, with huge safety and reputational risks. On the other hand, as already highlighted, smaller companies do not have time nor means to up-skill their workforce and would need some sort of financial compensation to incentivise them.

For the optimal design of “supply-centered” supportive policies, we generally recommend that policymakers enter in dialogue with European and national sectoral associations.