The Need for Increased Focus on ICT Skills to Drive Innovation in Europe

Sergio Giacoletto highlighted both the contribution of information and communications technologies (ICT) to Europe’s economy, and the shortage in IT skills that could impact the region’s growth and competitiveness. He suggested some ways that Europe can boost its 21st century skills base and increase levels of innovation in the region.

EU countries can do more to boost 21st-century skills and encourage innovation, according to Sergio Giacoletto, executive vice president of Oracle Europe, Middle East and Africa.

Speaking on a panel of industry and education-sector leaders at the Sixth European Business Summit in Brussels, Mr. Giacoletto firstly paid credit to the contribution of IT to the European economy, particularly in terms of providing employment. Delegates learned that Europe's IT sector currently employs almost 8 million people and is still in growth mode, with analysts expecting it to generate 1.5 million new jobs over the next five years. There are numerous highly-skilled ICT professionals across the region; a good example being Romania, where Oracle has chosen to base a major worldwide support centre, and Poland, where Oracle has created a centre of excellence dedicated to developing next-generation software applications for mobile handsets. Nonetheless, demand for qualified ICT professionals outstrips supply.

With skills like these available in the region, ‘near-shoring' skilled IT work within Europe is an eminently viable alternative to ‘off-shoring' to the India and the Far East. Oracle itself has recently opened an international near-shoring centre in Malagain Spain, which provides IT consultancy and support services to European businesses, and other IT vendors are undertaking similar initiatives.

However, Mr Giacoletto reminded attendees that Europe needs a large pool of advanced information-working skills in order to remain competitive. The EU's statistical office Eurostat had recently estimated that as many as 37% of Europeans lack even the most basic computer skills and are therefore unable to play a full participatory role in the information society. The shortage is costing some countries dear: the German Economics Ministry, for example, estimates that the country loses out on €20bn a year, or some 1% of GDP, through its lack of 21st century skills.

If the ICT skills shortage is not addressed, the long-term consequences for Europe could affect productivity and competitiveness. The strength of the region's skills pool is under further pressure from shrinking birth rates, meaning that there are fewer skilled school-leavers and graduates entering the workforce. The resulting decline in relevant skills combined with the rising costs of investing in Europe may oblige companies to look elsewhere for talent; notably the emerging economies of China, India and Latin America. Today's workers are increasingly mobile, and are likely to go where the lucrative jobs are. For this reason, Europe should also undertake measures to attract increasingly mobile qualified ICT professionals from third countries to the EU. Recent EU proposals in this regard deserve industry support.

To help develop IT skills in students, many IT companies have educational programs such as Oracle Academy and several companies have come together under the eSkills Industry Leadership Board, founded in June 2007 to promote eSkills and Digital Literacy. But Mr Giacoletto said that the IT industry on its own cannot rectify the skills and innovation gap. Close collaboration between governments, educational institutions and research organizations, and industry across the region will help create an advanced 21st century skills pool and a fertile environment for innovation. Although Europe's track record on innovation is often impressive – especially in the Nordic countries and Switzerland – its ability to commercialize those innovations to fuel economic growth and competitiveness currently lags behind that of the United States and Japan. This can be addressed, ideally by encouraging universities to take a more business-oriented approach to the important technological and scientific developments being generated within their walls.

Mr Giacoletto concluded by welcoming the EU's renewed commitment to increasing ICT skills, set out in an action plan that aims to endow future generations with the necessary 21st century skills to create and maintain a large pool of technical and scientific talent across the region.

Further Resources

Video: Oracle's Sergio Giacoletto talks to Euractiv about the changing relationship between universities and industry in Europe