‘New Collar’ worker shortage threatens to stall next industrial revolution
The next industrial revolution, driven by Artificial Intelligence and data, could be held back by a shortage of skilled workers and growing competition for locations with the right infrastructure and technology, according to a new report commissioned by SEGRO
• New SEGRO report finds up to half of vacancies in critical technical roles are unfilled, while only 10% of Europe's current blue-collar workforce has the next-generation industrial skills
• Analysis of more than 400,000 role specifications across 13,000 companies highlights growing competition for workers with practical, technical and digital skills
• Traditional Blue and White Collar roles are being challenged by growing prominence of ‘New Collar’ professionals, with a skills and technology-first focus
The next industrial revolution, driven by Artificial Intelligence and data, could be held back by a shortage of skilled workers and growing competition for locations with the right infrastructure and technology, according to a new report commissioned by SEGRO.
The research analysed more than 400,000 job advertisements across approximately 13,000 companies in eight European countries. It found that between just under a quarter and almost a half of vacancies in critical emerging roles remain unfilled, with some of the greatest pressure in the practical and technical jobs needed to deploy, operate and maintain new technologies.
The report describes these roles as the "new collar" workforce, which are defined as people in frontline, operational and technician-level jobs that combine practical experience with automation, digital, engineering or data skills. They include roles ranging from mechatronics and automation technicians to data centre electrical technicians and digitally enabled logistics workers.
The findings suggest that the next phase of industrial growth will depend on businesses having access to the right people and infrastructure, as well as the technology itself. This matters particularly for industries such as advanced manufacturing, logistics, life sciences and data centres, where many of the most sought-after roles have to be performed close to the machinery, systems and physical environments they support.
Across six sector comparisons, around 40% of vacancies for site-dependent roles were unfilled, compared with around 13% for more location-flexible roles, making the practical roles tied to factories, warehouses, laboratories and other physical assets around three times harder to fill on average.
The sectors examined in the report correlate with the five global innovation clusters identified in UK Prime Minister Andy Burnham’s reindustrialisation plan for the country, which could be undermined by the shortage of skills and physical infrastructure highlighted in this report.
The finding adds skills to the factors businesses need to consider when deciding where to invest. Access to land, power, connectivity and transport infrastructure remains critical, but businesses also need sufficiently deep pools of skilled labour within reach of their sites. As competition for that workforce increases, the accessibility and attractiveness of workplaces will become increasingly important too.
Paul Dunne, Managing Director, Operations, Digital and Customer at SEGRO, said:
"The next industrial revolution will create enormous opportunities, but technology on its own won't deliver them. Businesses need people with the skills to install, operate and maintain increasingly sophisticated systems, and they need the buildings and infrastructure where that work can happen.
"For businesses making long-term investment decisions, access to skills is becoming an important part of the location equation alongside land, power and connectivity. The places best equipped for future growth will be those that can bring the workforce, infrastructure and innovation together."
The research suggests that much of the potential new collar workforce already exists. Electricians, mechanics, maintenance technicians, warehouse operatives and other workers in adjacent occupations often have practical experience that can provide a foundation for more specialised technical roles. Yet less than 10% of Europe's current blue-collar workforce has the next-generation industrial skills identified by the research.
The jobs are there and so are the people. The missing ingredient is skills. Rather than relying on recruitment alone, the report calls for clearer routes to help existing workers build on the skills they already have and move into emerging occupations.
Competition for these skills also extends across sectors, with industries increasingly reliant on the same pool of technical capabilities and workers. The report warns that employers cannot solve the problem simply by competing harder for the same limited pool of people.
Smaller businesses face a particular challenge. Large companies are much better placed to invest in specialist training, equipment and internal academies, while many smaller businesses lack the resources to do so. As an indicator, 72% of employees in large companies received training in emerging technologies, versus 17% of SMEs. Because SMEs underpin industrial supply chains, the report argues that improving their access to training and workforce infrastructure will be important to the ability of larger businesses to grow and adopt new technology.
The UK starts from a relatively strong position, with around 588,000 manufacturing workers and significant workforce and infrastructure concentrations around London and the Thames Gateway, the Midlands and Manchester, alongside the innovation strengths of the Oxford-Cambridge corridor. However, the report argues that these locations cannot be treated as a single national talent pool, particularly for roles that need to be performed close to physical assets.
The report makes four recommendations for businesses and policymakers:
• Create clearer pathways for existing workers to move into emerging new collar occupations, recognising the relevant skills they already possess.
• Improve understanding of new collar careers and give young people clearer routes into them through vocational education, apprenticeships and workplace experience.
• Plan for technical skills across sectors and local labour markets, recognising that businesses in different industries are often competing for the same people.
• Give SMEs better access to specialist training, equipment and facilities through shared academies and workforce infrastructure.
Paul Dunne concluded:
"Businesses already have many of the people who could make this transition, but they need to give them a route to do it. That also means looking beyond individual companies. Large employers depend on skilled supply chains, and industrial locations depend on strong local labour markets.
"Without the skills, innovation remains an idea and logistics has nothing to move. Getting people, infrastructure and innovation working together will be fundamental to turning investment into economic growth."
Notes to editors:
About The New Collar Workforce
The New Collar Workforce: Competing for the talent to deliver the next industrial revolution was commissioned by SEGRO and informed by workforce research and analysis undertaken by Randstad Advisory.
The research was undertaken with Randstad Enterprise, the world's leading partner for talent. It analysed more than 400,000 job advertisements across approximately 13,000 companies in eight European markets: Czech Republic, France, Germany, Italy, Netherlands, Poland, Spain, UK.
The analysis focused on 60 emerging "new collar" roles across manufacturing, transportation and logistics, defence, life sciences, data centres, retail and construction.
New collar workers are defined in the report as people in frontline, operational and technician-level roles that combine practical sector knowledge with increasingly important automation, digital, engineering or data skills.
Selected findings
• Between 21% and 46% of vacancies in the critical emerging roles analysed remain unfilled.
• Across six sector comparisons, around 40% of site-dependent vacancies were unfilled compared with approximately 13% of location-flexible roles.
• Only 9% of Europe's existing blue-collar workforce currently has the next-generation industrial skills identified in the research.
• Only 22% of the 60 new-collar roles analysed offer a direct entry pathway, illustrating the importance of vocational education, apprenticeships and workplace experience for young people.
• The research identifies routes for workers in existing occupations including electricians, mechanics, maintenance technicians and warehouse operatives to move into emerging new collar roles.
• The research finds that industries including manufacturing, logistics, defence, life sciences, data centres, retail and construction increasingly compete for capabilities including automation, electrical systems, controls, robotics and predictive maintenance.
• The research combines Randstad Advisory's workforce analysis with SEGRO's assessment of logistics infrastructure and regional innovation to identify European locations where the ingredients for future industrial growth are already coming together. These include London and the South East, Munich and Southern Germany, Paris and Île-de-France, Rhine-Ruhr, the Dutch industrial and logistics corridor, Northern Italy and Prague.
Examples of new-collar career pathways
The report identifies transferable skills that could help people move from existing occupations into emerging roles, including:
• Electrician → high-voltage/data-centre electrical roles
• Maintenance mechanic → mechatronics/automation technician
• Diesel mechanic → electric-vehicle fleet technician
• Warehouse operative → digitally enabled logistics/inventory roles
About SEGRO
SEGRO is a Listed Real Estate Investment Company (REIT) of the United Kingdom, listed on the London Stock Exchange and Euronext Paris.
It owns, operates and develops modern warehouses, industrial properties and data centres across the UK and seven other European countries, with a portfolio of 10.9 million square metres of space.
Founded in 1920, SEGRO has created, thanks to an active approach to asset management and a rigorous capital allocation strategy, a portfolio of sustainable and high-quality buildings located in some of Europe's largest cities and major transport and digital infrastructure hubs.
From department store logistics to urban warehouses and data centres, SEGRO creates spaces that enable extraordinary things to be accomplished. It provides the infrastructure on which modern economies and everyday life are built, enabling efficient and low-carbon supply chains, as well as digital connectivity across Europe, contributing to economic growth and the creation of new jobs. These spaces support a diverse clientele that includes retailers, manufacturers, logistics service providers and technology companies.
SEGRO is committed to being a force for good for society and the environment, with three priorities at its core: Supporting low-carbon growth, investing in the environment and local communities, and nurturing talent.
Learn more about www.SEGRO.com