Strategic and ESG skills: the answer to the talent shortage

The Urgency of Strategic Skills

The talent shortage phenomenon is not just an isolated challenge for the world of human resources: it is a strategic issue rooted in a rapidly evolving geopolitical context. International tensions and changes in global supply chains, accelerated by events such as the COVID-19 pandemic, the war in Ukraine, and disputes between China and Taiwan, have pushed companies to drastically rethink their strategy for managing skills. Dependence on long-range suppliers and resources, often governed by just-in-time production systems, has proven unstable, pushing organizations to seek to build and strengthen internal capabilities with a more sustainable and forward-looking approach. Let us examine how the current context and labor market trends are influencing the search for and development of talent.

The Need for Strategically Sustainable Internal Skills

Global production chains have become increasingly fragile in the face of international-scale events. The 2021 Suez Canal incident, which blocked the transit of goods for days, is a significant example of the risks connected to an overly globalized supply chain management model dependent on punctuality. When the Ever Given blocked the canal, the impact on European and international supply chains was immediate, demonstrating how even a single incident can compromise entire supply chains (Jones, Supply Chain Management Review).

The COVID-19 pandemic amplified awareness of the vulnerability of supply chains, while the Ukraine-Russia crisis created difficulties in the procurement of crucial raw materials.

In this context, companies must develop internal capabilities that reduce dependence on international supply chains. As highlighted by Peter Cappelli in Why Good People Can’t Get Jobs, strategic skills must be built and maintained internally, not only to cope with the current geopolitical context, but also to respond to the demands of a market that increasingly rewards flexibility and adaptability.

The Importance of “Cross-Pollination” of Skills from Different Sectors

In the short and medium term, hiring professionals with skills from different sectors can help fill the gaps. However, this strategy is often temporary and does not guarantee long-term sustainability. In fact, it is crucial that skills be integrated into a continuous development strategy, so that talent can grow together with the company rather than remain isolated from it. This “cross-pollination” of skills, while valuable, works best when it accompanies well-structured internal development. Kaplan and Norton, authors of The Balanced Scorecard, emphasize how attracting talent from diversified sectors can accelerate innovation, but only if the organization has an internal growth system capable of enhancing and adapting these skills to its own needs.

Attention to ESG: New Generations and Talent Sensitive to Sustainability

The new generations of workers, particularly Millennials and Generation Z, are strongly attracted to companies with a solid approach to environmental and social sustainability (ESG). Recent Deloitte studies show that 64% of young workers consider social and environmental responsibility a determining factor in choosing an employer (Deloitte Global Millennial Survey). Having a strong ESG strategy not only helps attract talent, but also contributes to maintaining a positive corporate image in the market.

In addition, many companies reduced investment in training during COVID-19, leaving a gap in the preparation of new resources. To address this challenge, organizations need to strengthen internal training programs, as Carol Dweck suggests in her book Mindset, which illustrates the importance of a growth mindset. Continuous training is in fact essential to develop technical and soft skills that remain relevant over time and to motivate talent to stay with the company.

The NEET Phenomenon: An Untapped Potential Resource

Alongside the talent shortage, another phenomenon emerges that could offer a resource not yet fully utilized: NEETs. This term refers to young people who are not actively engaged in either education or work and who often remain on the margins of the labor market for prolonged periods. According to the Organisation for Economic Co-operation and Development (OECD), this category represents a growing issue in Europe and other industrialized countries, with serious social implications and a significant economic impact.

The OpenPolis Foundation, in a 2022 report, highlights that in Italy over 20% of young people between the ages of 15 and 29 are NEETs, one of the highest percentages in the European Union. The lack of access to the labor market and the absence of targeted educational opportunities risk marginalizing a generation potentially rich in talent, which could otherwise help bridge the skills gap in key sectors.

A study by Brown et al. suggests that re-engaging these young people through mentorship programs and targeted training, with a focus on technical and digital skills, could mitigate the talent shortage. Investing in customized pathways for NEETs, tailored to the needs of specific productive sectors, would represent an opportunity for both companies and workers, with positive effects on social integration and economic productivity.

Sustainability and ESG Values as Drivers of Attraction

Another aspect that companies must consider in the competition for talent is workers’ growing attention to values linked to environmental and social sustainability. According to Mercer’s 2023 Global Workforce Trends report, new workers, especially younger generations, consider ESG (Environmental, Social, Governance) policies a fundamental requirement when choosing an employer. Investing in ESG policies, in addition to being ethically relevant, therefore becomes a crucial lever for attracting talent, especially in a period of intense competition.

Demographic Decline and Future Challenges

Demographic decline in many regions, including Europe, represents a further obstacle to the supply of qualified talent. With fewer young people entering the labor market, companies are forced to deal with a shrinking workforce and a reversal in the demand for qualified skills (McKinsey Global Institute, The Future of Work in Europe). This means that companies will have to invest even more in training existing employees and in building an attractive working environment to retain talent.

Supply Chains and Just-in-Time Models: The Limits of a System Dependent on Geopolitical Stability

The just-in-time approach, which involves sourcing materials and products exactly when needed, has proven effective in reducing costs and waste, but now appears particularly vulnerable to international crises. Dependence on China and other Asian areas for the supply of essential components, such as semiconductors, has shown its limits during the pandemic and following tensions between the United States and China over the Taiwan issue. The recent “reshoring” and “nearshoring” strategy, which involves bringing production back to areas closer to the end market, has become a priority choice for many European companies (Boston Consulting Group, The Reshoring Imperative).

The return to more localized production, however, requires the hiring and training of qualified personnel who can guarantee a level of productivity and expertise equal to that achieved in other parts of the world. This process entails an initial cost, but allows for the building of a stronger base that is less dependent on geopolitical events.

Conclusions

The current talent shortage requires a proactive and strategic approach, in which critical skills are developed internally through continuous training, and in which the company demonstrates sensitivity to the needs of new generations and to changes in the international context. Addressing these challenges means preparing for a more stable and resilient future, in which growth does not depend exclusively on supply chainse delle nuove generazioni e ai cambiamenti del contesto internazionale. Affrontare queste sfide significa prepararsi per un futuro più stabile e resiliente, in cui la crescita non dipenda esclusivamente da supply chain internazionali e dalla volatilità del contesto geopolitico, ma da una solida base di competenze interne che possano sostenere l’azienda nel lungo termine.