The Economy

Top Ten Concerns of European CFOs

Rising salaries and skills shortages result in a cocktail of workforce worries.
Janet KersnarFebruary 4, 2008

Politicians and policymakers across Europe are thinking hard about how to make their countries more attractive to migrants with sought-after skills. They’ve got their priorities right, according to our latest poll of senior finance executives conducted in conjunction with Tilburg University in the Netherlands and Duke University in the US. The cost of labour tops the list of concerns of Europe’s CFOs. A shortage of skilled labour, meanwhile, comes in at second place. Will proposals to loosen immigration policies, including the EU’s “blue card” programme unveiled in the autumn, help ease CFO worries?

It is certainly welcome news for sectors such as construction and IT. The EU reckons that for these sectors to be competitive internationally, 20m skilled workers will be needed over the next 20 years. The blue card programme, fashioned along the lines of the US’s green card scheme, will make it easier for engineers and the like from outside Europe to get work permits in the EU, proponents claim.

It’s “a good initiative,” says Marcel Berges Fox, secretary-general of Acieroid, a €200m Spanish construction subsidiary of France’s Bouygues conglomerate. The construction industry suffers from serious labour shortages, from manual workers all the way up to engineers, he says, and don’t even ask about attracting quality finance staff as the subprime crisis batters the industry.

However, in the hands of EU bureaucrats, the programme could take several years to get off the ground. Moreover, previous attempts to introduce national green cards don’t inspire confidence. A visa programme launched in Germany in 2000, which intended to attract some 20,000 IT technicians from India and Poland, failed to generate much interest and was scrapped in 2005. But the shortage still needs to be addressed. According to the German Institute for Economic Research, the shortage of skilled labour is costing the country €18.5 billion (around 1% of GDP) a year.

Yet CFOs shouldn’t rely solely on relaxed regulation, asserts Martin Bergler, CFO of S&T, a €500m Vienna-based IT services firm. S&T, for example, is focusing more on training and education in response to the “war for talent.” But, he adds, S&T is “a people business and our know-how needs to be able to follow demand.”

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