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Public employment services’ missing link

How working with employers may improve labour market outcomes and contribute to their economic success.

Overview

There is a gap in public employment services (PES) that must be bridged. Better collaboration and interaction among PES/human services agencies and employers is the missing link to improve labour market outcomes. When employer needs are met through more customised, relevant services, employers will be more adequately equipped to grow their business and contribute to their country’s economy.

Background

The global skills gap crisis persists and will only become more acute as digitalisation continues to change the labour supply and demand landscape. Workers must develop new skills or upskill to remain relevant and employable in the digital world. Unemployment has reached an all-time high of nearly 200 million individuals and 1.7 billion people—or 46 percent of total employment—are in vulnerable employment situations.1

Simultaneously, the European Commission warns that Europe could be facing a shortage of up to 825,000 ICT professionals by 2020 2. The tides must shift or global economies will perpetually be weakened by skills gaps and mismatches.

1 International Labour Organization, “World Employment Social Outlook: Trends 2016;” page 9, online at http://www.ilo.org/global/research/global-reports/weso/2016/WCMS_443480/lang--en/index.htm

2 European Commission; “Grand Coalition for Digital Jobs,” June 7, 2016, online at https://ec.europa.eu/digital-single-market/en/grand-coalition-digital-jobs

Key Findings

Public employment services (PES) and human services agencies play a lead role in initiating change, yet their focus has historically been one-sided—focused on serving the needs of citizens and finding them jobs. However, many agencies lack a strategy for collaboration with employers to serve their needs as well as help maximise business outcomes.

Analysis

By not putting enough emphasis on employers—a critical player in the ecosystem—agencies are missing opportunities to save costs, grow the economy and realise value through reduced benefit payments, reduced skills gap and lower risk of social tensions. It is time to evolve the mission from predominantly being a safety net to being a partner that helps employers maximise the growth of talent and contribute to the country's economy. Agencies should support employers in maintaining a talent pipeline that meets future business needs and ensuring an engaged and motivated workforce.

Recommendations



PES and human services agencies around the world are modernising their strategies and making progress to improve collaboration with employers, however, no single country is focusing on all four factors.

  1. Understand that citizens aren’t the only customer

    Currently, only 40 percent of PES agencies have contact with a limited number of employers in their country. This reflects the need to fundamentally shift the strategy by expanding the reach of services beyond citizens to cover the needs of employers.

  1. Share, rather than sit on, information

    Information sharing is already improving labour market ecosystem collaboration in a few leading countries. For agencies that adopted a “give and get” mentality and make their useful data available to employers, other government agencies and labour market actors, several improvements would happen.

  1. Segment for success

    Just as citizens have unique needs, so do employers. Segmenting employers by for example size, region or industry, enables human services and PES agencies to tailor services accordingly and thereby improve service quality and customer satisfaction.

  1. From reactive to proactive

    Rather than a reactive “catch you when you fall” approach, human services and PES agencies can reach out proactively and support employers holistically to maximise potential early on.

Authors
Lena Carlstrøm
Lena Carlstrøm
Senior Manager
Accenture Management Consulting
Mail to Lena Carlstrøm. This opens a new window. LinkedIn
Karen Klakegg
Karen Klakegg
Consultant
Accenture Management Consulting
Mail to Karen Klakegg. This opens a new window. LinkedIn

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