European companies, especially smaller ones, are suffering from labour and skill shortages, more than their British and American counterparts, a recent survey has shown.

But while they are more likely to hire from abroad than American and Canadian companies, the proportion of those seeking foreign workers remain small.

A Eurobarometer survey carried out among small and medium-sized enterprises (SMEs) has found that in most European countries finding staff with the right skills is the biggest problem, more important than bureaucracy, unfair competition or access to finance.

The European Commission says the problem has grown over the years and affects all sectors of the economy. The harder-to-fill roles are those requiring vocational training qualifications, while it is less difficult to find staff for jobs requiring bachelor’s and master’s degrees. SMEs struggle in particular to find technically trained staff such as lab-workers and mechanics.

In the past two years, 61 percent of micro companies (with less than 10 employees) and 80 percent of medium-sized one (between 50 and 250 staff) experienced difficulties hiring staff with the right skills. In Denmark and Sweden micro companies seem to have less problems, as 45 percent and 37 percent respectively said they struggled. On the other hand, almost all medium-sized enterprises in France and Switzerland (96 percent and 95 percent) had difficulties, while the proportion was 85 percent and 84 percent respectively in Spain and Sweden, and much lower in Italy (59 percent).

The survey involved some 19,350 SMEs including also non-EU countries such as Norway, Switzerland, the UK, the US and Canada.

When looking at ways to plug staff shortages, 30 percent of European SMEs looked to recruit abroad. The proportion was higher for the UK (33%), but lower for the US (15%) and Canada (11%).

Some 14 percent of European SMEs reported hiring staff from other EU countries, a proportion that reached 40 percent in Austria and 22 percent in Denmark, but was as low as 7 percent in France. On average, 16 percent of SMEs reported hiring from outside the EU, with proportions ranging from 11 percent in Sweden, 12 percent in France and Denmark, 13 percent in Spain, 17 percent in Germany and 21 percent in Italy.

While recruitment within the EU is easier thanks to free movement rules, only 50 percent of SMEs reported not having had problems in this regard. Otherwise, languages and to a lesser extent administration were identified as the main obstacles to recruit staff across the EU.

In a recent analysis, BusinessEurope, the confederation of industry associations in Europe, said that labour and skills shortages are due to “demographic change; high rates of inactivity; and relatively low levels of intra-EU mobility”.

The European Commission has recently proposed to make the recognition of professional qualification easier and to create an EU Talent Pool, a scheme to match European companies with non-EU jobseekers.

The EU is currently also reviewing rules to make it easier for third country nationals residing in the EU long-term to move within the bloc in the attempt to make the EU a more appealing work destination.

BusinessEurope Director General Markus J. Beyrer said commenting on the Talent Pool: “It is high time that the EU acknowledges the role of economic migration in helping to address Europe’s labour and skills needs”.

“The proposed Talent Pool can be a game changer in making Europe a more attractive destination for the needed skilled workers from third countries around the world. Helping to match skilled third-country nationals with the most pressing shortage occupations is an important approach.”

A survey among BusinessEurope members has shown that 78 percent of companies view mobility and migration favourably to resolve labour and skills shortages.

More information on each country’s situation is available here.