La demographic crisis in Italy it is influencing the labor market. Since 2014, the country has been experiencing a constant reduction of the population, accompanied by a progressive ageing. 2022 marked a record for Italy, as for the first time in over 150 years less than 400 children born. These demographic changes are generating significant challenges for the economy, both now and in the future. This is what emerges from a CDP document (Cassa Depositi e Prestiti) which has analyzed demographic trends taking place in the country and the possible effects on the future availability of the workforce.
Mismatch between labor supply and demand
Currently, Italy is facing employment and activity rates at historic highs, which amount respectively to 60,8% and 66,1% at the end of 2022. This is due both to the acceleration of demand in the construction sector and to the impetus given by the National Recovery and Resilience Plan (PNRR), and to the retirement of the so-called “baby boomers”.
However, in this context, themeeting between the demand and the supply of labour it is becoming more and more complex. In the 2022, the 41% of hires in Italy it has encountered difficulties in finding suitable candidates, both for highly specialized figures and for less qualified profiles. This situation is the result of several factors. First, the decrease of young people entering the labor market it is limiting the renewal of skills. The absence of an adequate flow of young workers prevents the updating and evolution of the skills required by companies and institutions. The second factor comes from retirement of low-educated workers. These workers, who often occupy less skilled positions, cannot easily be replaced by the youth workforce, which is on average more skilled. This creates a vacuum in the workforce and requires additional efforts to train and adapt new workers to market needs.
In Italy, the mismatch between labor supply and demand occurs in a context characterized by high percentages of people of working age is they do not participate in the labor market. In our country, the percentage of residents of working age who do not work is the highest in the European Union, equal to 35,5%, as is the percentage of young people aged between 15 and 29 who neither study nor work (23,2, 10%). The latter value exceeds the European average by 9 percentage points and is well above the 2030% target set for XNUMX.
Future prospects
Demographic dynamics and the increase in the average level of education will have a significant impact on the composition of the workforce in Italy in the future. According to internal projections, by 2030 one could occur contraction between 2,0 and 2,4 million low-skilled workers, mainly between the ages of 35 and 54 and mainly in the regions of the South and North-West. At the same time, a growth between 1,1 and 1,6 million more skilled workers, especially for individuals over 50 and in the regions of Northern Italy.
Two great challenges for the Italian labor market
So they are profiled two big challenges for the Italian labor market.
First, it will be necessary address the large need for less skilled workers. This will require the implementation of two main policy options in the short to medium term. The first option is to use automation to increase efficiency and reduce reliance on human labor. The second option is to strengthen labor supply in labour-intensive sectors, such as agriculture, construction, tourism and domestic-family services. This can be achieved through specific policies aimed at the integration and training of new residents entering these work sectors.
The second challenge is toalign profile skills highly educated at needs of companies and institutions. It is essential to adopt lifelong learning, reskilling and upskilling measures for workers over 50. For young people, it is essential to move towards the professions required by the market, especially in the STEM disciplines (Science, Technology, Engineering and Mathematics).
