Italy has warned that severe labor shortages are hampering the country’s ability to implement multibillion-euro projects under the EU’s post-pandemic recovery programme.
In a report submitted to parliament, the Italian government has warned that a shortage of skilled workers in construction, IT and engineering – and a lack of skilled administrators – is causing delays and “may jeopardize the full implementation of the plan to take”. Italy is the largest beneficiary of the bloc’s €800 billion program and is expected to receive grants and loans worth up to €191.5 billion in 2026.
The report comes as Rome has been waiting for several months for Brussels to release its next tranche of funds, worth €19 billion. It is also an acknowledgment that Rome is likely to experience more delays in the disbursement of further funds.
The recovery plan is seen as a one-time opportunity to revive Italy’s chronically underperforming economy and boost long-term growth by funding infrastructure investments such as rail lines, water systems, childcare facilities and health clinics.
But Rome says at least 20 percent of projects due to be completed by 2026 face constraints such as higher raw material costs, bureaucratic delays, lack of business interest or technological shortcomings.
The government is now in talks with Brussels about a thorough revision to make the plan more realistic. Changes to the program may include extending deadlines or scrapping projects, requiring those projects deemed to be of strategic importance to be funded from resources not tied to such a strict timetable.
“It is inevitable,” said the government report, while reaffirming Rome’s commitment to achieving the “qualitative and quantitative objectives” of the program.
The Bank of Italy had estimated that the ambitious investment package in 2024 would create 375,000 additional jobs in Italy in a program to be completed by 2026. impact” on its progress.
With a rapidly aging population, Italy suffers from a pervasive labor shortage, with employers complaining of a struggle to fill around 40 percent of vacancies due to a lack of qualified candidates.
The situation is expected to worsen over the next three years, when Eurostat estimates that Italy’s labor force will shrink by around 630,000 as the number of people reaching retirement age exceeds the number of new entrants to the labor market.
The Bank of Italy has urged the government to create a “priority channel” to attract skilled workers from abroad to quickly boost the recovery plan.
But Giorgia Meloni’s right-wing coalition is ambivalent about allowing non-European migrant workers to fill gaps in the labor market, instead cutting social security programs to urge people it considers “employable” to get a job. to assume.
Italy is issuing just 82,750 work permits this year for migrants from outside the EU from its annual lottery system, though employers have applied for more than 240,000 permits this year to meet their labor needs.
Cities and towns that need to receive money for infrastructure upgrades also lack experienced administrators to oversee the work.
“In the public administration, we don’t have people to take care of the projects,” said Francesca Benciolini, a Padova city councilor. Her city will receive 238 million euros from the EU Covid-19 fund for a new tram line
“In all technical jobs like architects and engineers,” Benciolini added, “we don’t find people. It’s a national problem.”
