At a time when globalisation, technological progress and demographic change are profoundly altering the types of jobs that are available, as well as how and by whom they are carried out, investing in skills is more important than ever to build resilient and inclusive labour markets that underpin social cohesion and well-being, and promote smart, sustainable and inclusive growth – as emphasised in the Europe 2020 Strategy and the European Semester process.
The present report examines how governments use financial incentives to promote a better alignment between labour market needs, on the one hand, and the supply of skills, on the other. In doing so, it identifies: i) innovative models that countries may be interested in learning from; ii) best practice in the design and use of financial incentives; iii) framework conditions for their effective use; and iv) limitations and risks in the use of financial incentives.
