Eight years after the advent of the Global Financial Crisis, much of Europe's economy continues to be sluggish, with uneven rates of jobs and business growth across the EU. There are, of course, bright spots on the map, but overall the picture remains disappointing.
As ever, the coming battle focuses on cities, where most businesses and jobs are concentrated. In those economies that remain weak, it is our cities which display the highest rates of joblessness. Equally, it is in our dynamic urban areas where hopes for business and jobs growth are highest.
The EU has consistently identified the key role cities occupy in relation to the skills and jobs agenda. A long history of macro policy statements and policy directives confirms this. The most recent of these is the launch of the Jobs and Skills Partnership within the Urban Agenda for the European Union. Another is the New Skills Agenda for Europe, which proposes a 10 point plan to boost EU citizens’ skills, particularly at the basic level.
But what does this mean in practice? This article will explore the challenges and opportunities facing cities in relation to the jobs and skills agenda. It will pay particular attention to assumptions about future growth – itself increasingly challenged as a beneficial concept. In doing so the article will touch upon the concept of the Next Economy, and what Jeremy Rifkin has described as the Third Industrial Revolution (TIR). Under this scenario, we will need a radical rethink of the way we prepare citizens for what is ahead.
We will explore what the Jobs and Skills Partnership can do to support cities' adjustment to this anticipated step change in the economy. Finally, the article will reflect on the leading work of cities in this area, as well as considering the contribution that the URBACT Programme can make.
As ever, there is good news and bad news. The good news – according to Rifkin and others - is that the convergence of Internet technology and renewable energy has the potential to transform the economic model which has been prevalent for over 100 years. This shift encompasses the transition from fossil to renewable fuels, transforming buildings into generators of clean fuel, with dramatic drops in energy charges. Importantly, it also includes the potential of the Internet of Things to enable all devices to communicate with one another.
Together these have enormous potential for transformative change, for example in the logistics and mobility sectors. The establishment of a new energy regime provides the framework for this revolution. In this, energy is loaded by buildings, partially stored in the form of hydrogen, distributed via a green electricity Internet, and connected to a plug-in, zero-emission transport network. Households are morphed into energy producers with earning potential through feed-in tariffs. Citizens are new prosumers of energy. The prospects is breathtaking – and potentially gamechanging.
Alongside this, Rifkin and others have identified the growth of the Commons movement as the social lubricant for this new economic paradigm. Facilitated by the Internet and by the principles of the open source movement (and harking back to pre-capitalist transactional models) the Commons structure has been reimagined. Digital and social media tools are helping reshape collaboration models and catalyzing the shift towards horizontal networks. The social economy, for so long a Cinderella sector, may finally be coming of age, particularly as Millenials prioritise quality of life issues over financial rewards.
So far so good. However, in some parts of Europe these elaborate descriptions may read like science fiction. In fact, even in our most advanced cities, significant proportions of our citizens remain unprepared for what is ahead – and what is actually happening now. That goes for our education systems, which have struggled to adapt since the onset of the Internet and the unleashing of the digital economy. Our children can acquire more knowledge on their tablets for one hour than they can do in a routine school day.
At the other end of the demographic scale we have growing numbers of older people within our labour market. On the plus side this is driven by improved health levels. On the down side, inadequate pensions mean older people have no choice but to work longer. Alongside this, we have new arrivals coming to Europe’s cities looking for a future. Arriving with hope, energy and resilience, the challenge is to find ways of enabling them to make an active contribution to our economies.
In a nutshell, this is what we face. On the one hand, an exciting new age of opportunity. On the other, the reality of a Europe where significant proportions of citizens have such low skills that their future prospects are curtailed. According to the EU’s latest data, 1 in 5 adults have low literacy levels, almost 1 in 4 low numeracy levels and 2 in 5 (41%) have no basic digital skills. At the same time, this data indicates that 2 out of every 5 employers have difficulties finding staff with the right skills.