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Labour market: innovation and skills development

    • Milan
    • 4 November 2019

          The global economy is undergoing deep and rapid changes that are revolutionizing how production is organized. The very concept of the “job market” seems outdated in a world where skills are increasingly becoming the real currency. If the most innovative firms’ main demand is for talent, however, it is impossible to imagine a future without policies tailored to the transition that the majority of workers are going to have to face as they adapt to the continuing changes imposed by digitalization.

          These broad changes call for new and more adequate social welfare instruments, especially in a country like Italy that still concentrates its social spending on forms of protection, and mainly pensions. The revolution under way obliges that energies and resources be spent in social investments that prepare people ahead of time for market changes instead of exclusively ensuring their right to compensation after they have lost their jobs. Moreover, the Italian welfare system would benefit from the greater involvement of private and tertiary sector actors in order to increase its capacity for social intervention and efficiency.

          The main instrument available to companies and workers preparing for the revolution is continuous training. This involves traditional academic institutions that, on the one hand, are being forced to review their 20th-century approach and begin to dialogue with the more innovative world of production and, on the other, must begin again from the ground up to offer young people a learning method that will be useful to them in their active working lives. A system centered more on learning than on teaching will be able to elevate that vocational component that has already been shown to make the difference in various European countries, especially when combined with a more frequent and fertile interface between school and work. These are important steps in addressing the supply/demand skills “mismatch” that often penalizes both companies and workers in Italy.

          All these challenges call for neither short-term nor medium term planning. In order to seize the opportunities offered by a digitalization currently driven by non-European companies and research centers it is going to be necessary to contemplate a broader horizon and begin to work immediately on implementing the steps necessary to reach it. Italy is especially penalized in this respect not only by a lack of political stability, but also by the miniature scale of its entrepreneurial fabric, which together slow innovative processes. A change in cultural gear that leads to growth and internationalization (evolving from family-run to management-based businesses) is the prerequisite for confronting the challenges of the future.

          For this to happen there has to be a cultural leap that starts from the corporate boardroom and involves human resources managers. Indeed, the digital revolution cannot be viewed as simply a collection of technicalities but as the obligation to enact deep changes that modify people’s work, daily lives and even mind sets. Understanding how deep that goes is the first and fundamental step in confronting and controlling the changes that are certain to affect the world of production and labor in the coming years.

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