Partner of InHunt World in Italy: INplacement
Italy, the home to many of the world’s greatest works of art, architecture, and fashion, is a developed economy with a wealth of potential. Today, Italy is the fourth largest economy in Europe and the 8th largest in the world, with a GDP of 1,859 billion US dollars in 2016. The massive domestic market of 60 million people offers many opportunities for businesses. Italy also represents a strategic gateway to 500 million consumers across Europe and to 270 million in northern Africa. For over 30 years, Italy has been the 2nd largest manufacturing economy.
The Italian workforce is quite skilled and competitive; the average labor costs are well below the EU average. The number of people taking advanced secondary school and university courses is slightly below the OECD average but constantly increasing. Traditions and a sense of history play powerfully on Italian minds, and both of these have heavily influenced the Italian approach to business. For example, management structures are often weak and very hierarchical because of strong family presence in the Italian society. Another consequence to this family-bound society is that Italians are not keen on moving around for jobs and will most likely never move away from the city their family lives in.
The Ease of Doing Business in Italy
World Bank rated Italy 50th on their Ease of Doing Business index. The index is based on 10 subcategories, such as the ease of starting a business, getting electricity and dealing with construction permits. Italy shares the number one rank with 17 other economies for trading across borders. The country is ranked 24th for the second year in a row for registering property and 25th for resolving insolvency, a two-rank drop from 2016. The worst score Italy gets is for paying taxes, ranked 126th out of 190 compared nations. There has been some improvement though; in 2016, Italy was ranked 134th, as the country made paying taxes easier by allowing full cost of labor to be deductible for regional tax productive activities and improving the electronic system for preparing and paying labor taxes.
Politics and economy
The Italian economy is dominated by only a handful of large enterprises while most of the economy prospers thanks to the over 3 million small to medium-sized businesses. The labor market conditions continue to improve slowly, as the share of the population aged 15-74 has almost come back to its pre-crisis level. Still, Italy’s employment rate is one of the lowest among the OECD countries.
Tourism is definitely one of Italy’s strong suits; estimated revenue from this industry is €189.1 billion. Conflicts and trouble in popular tourist areas such as Turkey and Tunisia are pushing tourists to search for safer holiday spots, and Italy is one of those. There are in fact so many visitors in Italy that the government has thought of implementing a tourist cap to reduce overcrowding of the most popular places and trying to offer alternative options.
The Italian government faces pressure from investors and European partners to sustain its efforts to address the country’s structural issues slowing down growth.
What to keep an eye on
The Italian Government’s actions. Persistent problems include slow economic growth, high youth unemployment (especially female), organized crime, corruption, and economic disparities between the northern and southern parts of Italy.
Tourism still on the rise. Will the problem of overcrowding get worse? Millions of Chinese, Indian, and other nationalities with newly found wealth are looking to travel abroad. The number of Chinese traveling overseas hit 125 million in 2015, and is estimated to reach 200 million by 2020, according to the Telegraph.
We had a chance to interview Alessandro La Rosa (CEO, INplacement). We asked Alessandro few questions about the headhunting and recruiting market in Italy:
How do you see the situation at the moment?
Italy has gone through a strong period of political and economical change that is still ongoing.
A good portion of the manufacturing production has been moved to the neighbouring Mediterranean countries where labour costs are more advantageous.
We are (finally) witnessing a strong cultural, social, and economical transformation. The traditional “craftsmanship’ (or profession) have, and are, evolving, in line with the European trend and demand for profiles with a higher technical “expertise”. Positions that haven’t changed, if not for a salary decrease repositioning, are in the areas of Finance ; Engineering ; Sales & Marketing.
It is important to note that also in Italy there is a high influence coming from the Hi-Tech – IT – Digital sectors that bring into the market also aspects related to the Cyber Security topic with an impact on the request for a strategy consultancy on behalf of the companies that desire to invest in Italy.
Are there some industries in Italy which are growing faster than others?
As in all periods of “change” new sectors and related businesses develop; for example the Hi – Tech sector or the Digital Marketing one. Also the IT sector is growing pushed by new emerging sectors related to consultancy services or also by infrastructures that want to be modernized. Other sectors that are always active, and that have gone through strong restructuring phases in the last years pushing further growth are Pharmaceutical, and Health Care (hospital) followed by the FMCG.
What kind of roles and talent are companies looking for?
Companies are looking for technical experts, scientific experts, and blue collar skilled workers.
We must distinguish between multinational and local companies. Multinational companies have high target profiles whilst the local companies aim for lower profiles. The Italian branches of multinational companies follow their “Global standard” guideline.
There is always a request for young and talented profiles in business management, accountants experts in european standards (IAS/IFRS ) with competences in people management. Also in the IT sector there is a high demand due to new system implementations and improvements in order to comply to European standards.
Is there some kind of talent shortage in Italy?
Italy is the homeland of talents, so there isn’t a shortage; it is also true that the talented profiles move abroad where the labour market is more adeaquate and able to absorb the profile. In Italy salary levels are frequently too low for the position in comparison to other countries abroad, and the duration of the internship is still too high. These factors lead to a migration of talents abroad.
Are companies looking mostly for Italian people, or are they also interested in people from abroad?
There aren’t any discriminations for foreign talents as long as they are eligible to work in Italy according to the current legislative rules. The knowledge of Italian is still very important. According to the nature of the company, the second language may be English, French or German. The young people will need to make the difference in order to compete in this new dynamic labour market.
How do you see the development of recruiting and headhunting markets in Italy over the next couple of years?
The new generations and the use of social media must generate a cultural change in recruiting. New communication channels, together with a more personalized approach must be implemented in a faster pace market. There will surely be an increase in the Digital and IT sectors, giving for granted the basic competences that a specific traditional position must have, that must be coupled with progressively stronger high tech skills.