By Stanislas De Joussineau Jul 31, 2020
Technology has transformed the modern world, accelerating the disruption of global industries and changing the way we live, work and communicate, leaving many European businesses under pressure to quickly adapt. Unfortunately, as industries across the region harness technology to meet this new reality, we are concurrently moving towards a future where many Europeans will be left without the skills to thrive in this new digital era.
No event has put this more into focus than the COVID-19 pandemic, which has forced both companies and workforces across Europe to get online - or risk falling behind. Before the crisis, approximately 30% of jobs globally were going to be impacted by technology by 20301, and would require reskilling. Europe, in particular, faces a concerning skills gap in the types of vocational and digital qualifications needed to be competitive in today’s job market. At the start of the year, many Europeans were already at risk of being left behind: approximately 40% of employers struggled to fill their job vacancies, largely due to a lack of necessary skills across the continent2.
Closing the continent’s skills gap is critical and COVID-19 has accelerated the risk. The response must be urgent and broad to ensure we protect the future of the European economy and the welfare of its citizens.
At the heart of this response are solutions driven by public-private partnerships where strategic investments, scaled charitable initiatives, and the combination of complementary resources and skills all have a role to play. These efforts must be efficient, effective and outcome-driven to ensure the work has a real impact on people’s lives. At KKR, we are supporting these solutions in two ways.
First, we’re working with businesses on the frontlines of reskilling and upskilling Europe’s workforce. We’ve recently invested in MasterD, a vocational training company that provides over 280 courses to 50,000 people across Spain and Portugal each year. Spain faces a particular upskilling challenge: Spain has a structurally high unemployment rate, which is twice the EU average. This is in part due to the fact that the share of Spaniards with low qualifications is almost double the European average: nearly 40% of 15 to 64-year-olds have not completed secondary education3 and Spain has the highest EU school drop out rate at 18%.
On the other end of the spectrum, however, Spain has the highest share of university degrees in the EU. This leaves a big gap in the middle of what employers need and what the labour market can provide4.
In an effort to upskill those without a university degree, MasterD offers continuing education courses for those who may not otherwise be able to afford it. These courses – which combine personalised online coaching and in-person learning - cover vocational training and professional certifications to equip participants for jobs across a range of disciplines in a virtual learning environment.
MasterD helps learners at all stages of their professional and educational development that want to improve their job or career prospects. They also help address a critical societal challenge in improving skills and therefore employability. Their mission aligns strongly with the reasons we created KKR’s Global Impact strategy. We are pleased to support MasterD on the next stage of its growth by providing financial and operational expertise, enabling it to reach even more people with its programming. We’re particularly excited about the prospect of pairing MasterD up with another KKR portfolio company, Burning Glass, a major labour market analytics provider. Their insights will help align MasterD’s course offering with real time market demand to maximise outcomes.
Second, while we are firm believers in the transformative power of technology, we are cognizant there is a big gender divide and feel strongly that diverse perspectives make us and our portfolio companies better. These are just a few reasons why we’ve supported Code First Girls, an organisation that has provided free coding courses to 17,000 women worldwide since 2015. Not only is their work closing the gender gap in the tech industry, but it also is providing girls worldwide with the skills they need to succeed in the digital economy. We’ve been proud to not only support Code First Girls financially, but also provide them with access to our global resources and network to help them grow.
But there is always more we can do. The graduate today will have 10 to 15 different jobs during their professional career. This will require continued learning, training, and upskilling.
We are hopeful, however, that KKR’s investment in MasterD and our work with Code First Girls will have a meaningful impact in closing the skills gap and providing a foundation for lifelong learning. We will continue to seek out opportunities to help propel the continent forward into the digital future.
1. McKinsey, Jobs lost, jobs gained: Workforce transitions in the time of automation
2. Deloitte, Expected skills needs for the future of work
3. EuroStat, Population by educational attainment level, sex and age (%), http://appsso.eurostat.ec.europa.eu/nui/show.do?dataset=edat_lfse_03&lang=en]
4. Spanish Ministry of Education, Eurostat