Accelerated investments in digital and sustainability could add up to 5.7 million new jobs across Europe by 2030, according to a new research report from Accenture conducted in collaboration with BusinessEurope.
The report, “Europe’s new dawn – Reinventing industry for future competitiveness,” shows that although Europe was keeping pace with other regions from a growth and market share standpoint pre-pandemic, the trajectory has since diverged. European businesses now expect their recovery from the pandemic to take at least six months longer than companies in Asia-Pacific and North America expect their own recoveries to take.
However, the report notes that Europe is well-positioned to leverage future growth opportunities due to its strength in key industries. This strength, coupled with investment in digitalization and sustainability, could boost employment and create millions of jobs in the region by 2030.
The accelerated investment in both digitalization and sustainability — which the report refers to as the “Twin Transformation” — could boost net job creation by up to 5.7 million by 2030 across the region compared to the number that would be created if digital and sustainability investments were not accelerated. Top industries for net job creation include industrial equipment, high tech, software, utilities, automotive, life sciences, and communications/media.
To create these jobs, Europe will need to reinforce its global leadership position in the automotive, consumer goods and services, utilities and chemicals industries and build on the potential of industries in which European businesses are already well-positioned, such as aerospace & defense, life sciences, and communications/media. Opportunities also exist in other industries, including industrial equipment, technology and software, but they will need to further invest in innovation and accelerate both their digital and sustainability transformation.
“We are witnessing the emergence of a new paradigm for growth and competitiveness globally, which European companies are well placed to leverage,” said Jean-Marc Ollagnier, CEO of Accenture in Europe. “Although the comparatively slow vaccine rollout in Europe may be tempering businesses’ hopes of a speedy recovery, the region’s leading position on sustainability — coupled with investment in the most promising technologies and in emerging cross-industry ecosystems such as mobility — could increase its competitiveness, enable the emergence of global leaders, and open up millions of new jobs across the region in the long term.”
For European industries to maintain their position or emerge as global leaders, they will need to invest in certain technologies and high-growth areas.
According to the report, which includes a survey conducted with 700 C-level executives across Europe, technology investment should be focused on artificial intelligence, mentioned by 66% of the respondents, 5G and 6G (58%), cloud (52%) and next generation-batteries (34%). When asked to identify high-growth areas, “smart manufacturing” was cited by more European business leaders (55%) than any other areas, followed by “digital health” (50%), “smart mobility” (46%) and “energy transition” (33%).
European businesses accelerating investment in technology, sustainability and their workforces
Nine out of 10 European companies (88%) plan to increase their investments in digital transformation and sustainability practices this year, whereas only 58% increased their investments in those areas in 2020.
European businesses are also placing a heavy emphasis on reskilling their workforces. More than three-quarters (86%) of European companies plan to upskill/reskill up to 25% of their workers in the next three years to keep pace with their company’s need. Overall, approximately seven million workers in the region could benefit from upskilling/reskilling initiatives.
“Although the COVID-19 crisis is not yet behind us, there is an urgent need for businesses not only to prepare for the rebound, but also to reinvent themselves to remain or become global leaders,” Ollagnier said. “There is a unique opportunity for Europe to lead in the post-pandemic economy but achieving this will require making investments today in the right technologies and ecosystems — and, most importantly, in people. This is how future growth and jobs will be created.”
European Governments and the EU Institutions also have a critical role to play to facilitate the emergence of global leaders in Europe
For European industries to emerge as global leaders and to support the employment creation opportunity in the region, European governments and the EU Institutions are expected to play a key role.
The report has identified five areas for actions that European businesses expect governments and EU institutions to undertake. These include:
- Build the next generation workforce: this includes upgrading education and training systems by promoting key incubators of talent and ensuring alignment with the most needed skills while facilitating digital literacy, life-long learning and vocational education.
- Enable digital transformation and the transition to a sustainable economy: this includes planning and rolling out a common technology infrastructure (5G, Cloud, IoT, AI) and supporting decarbonization efforts. Also, the creation of an investment and innovation-friendly regulatory framework is expected, for instance by reducing legal fragmentation and red tape and further developing innovation “sandboxes” to test emerging technologies.
- Support the development of high-potential industries: in particular through investment in disruptive and breakthrough research and innovation, adoption of policies to support the development of innovative industrial ecosystems, and the creation of public-private partnerships.