Micro- and nanotechnology companies to raise staff numbers again - Skills shortage particularly concerns German companies

The latest economic data survey of the IVAM Microtechnology Network confirms how well the microtechnology, nanotechnology and materials industry in Europe has recovered from the economic and financial crisis. The companies want to hire more employees again, their sales have risen strongly, they are aiming for new overseas markets and looking out on the new business year with confidence. However, skills shortage and a persistent difficulty to raise capital may eventually restrict the industry’s growth.

According to the survey conducted in January 2011, 60% of the mostly small and medium-sized companies intend to hire new staff during the year 2011. This means that the positive post-crisis trend, which has made itself felt in 2010 already and which can be observed in other industries as well, will continue in 2011. While in 2009 only 26% of companies reported an increase in the number of employees, no less than 44% have hired new staff in 2010.

Turnover jumps – export remains stable

Almost half of the companies (47%) increased their turnover by more than 10% as compared to the previous year. The positive trend in sales is to continue in 2011, according to industry forecasts, though not quite as strongly as it did in 2010.

The industry’s export quota has remained more or less stable in 2010 compared to the previous year. A quarter of the companies have gained more than 75% of their turnover from exports. Half of the export transactions take place within Europe. Germany continues to be the most important export market for the companies in other European countries, followed by the U.S. and China. German high-tech companies export mainly to the United States, China and Switzerland.

Prospects on 2011 are fine

Good prospects for the new fiscal year: nearly two-thirds of the European micro- and nanotechnology companies expect that their business will continue to improve during 2011.  Especially orders, production and sales figures are supposed to rise explicitly. But the companies also want to surpass last year’s export and investment figures.

Industry addresses skills shortage by itself

It seems that the shortage of skilled workers has not made itself fully felt in the microtechnology, nanotechnology and advanced materials industry, yet. Almost 40% of the companies in Europe say that the skills shortage is no pressing issue for them now, nor do they expect to be affected by the shortage during the next five years. In general, the companies in Germany are more sensitive to the issue of skills shortage than those in most European neighbour countries. In Germany, 64% of companies expect that they will be affected by the shortage by 2015. Those companies who feel the skills shortage are particularly short of specialists with academic and technical skills for product development and R&D.

For the time being, it is up to the companies to find appropriate solutions, as any measures discussed by political bodies – like facilitating migration, raising the retirement age, expanding child care or enhancing the quality in education – will not be effective in the short term. A little more than 60% of the affected companies have already taken measures to counteract the skills shortage. These measures include increasing the number of training and graduate positions, conducting appraisals or satisfaction surveys, or granting specific and individual on-the-job training attuned to the needs of the company.

Funding gaps remain

Although the financial crisis has been officially declared to be overcome, it remains difficult for the European high-tech companies to get sufficient financial means to invest in their own business and new developments and ultimately to boost the economic growth. Financing has become more difficult in the past two years for about 40% of companies. Bank loans, in particular, are hard to come by, as many banks have increased the barriers to lending and are taking longer to process requests. But funding opportunities have gone down in the last two years, too. Again, the companies complain about higher obstacles for application and the fact that programs were terminated.

However, it seems that the funding gaps do not curtail the possibilities and willingness of companies to invest in new developments too much. The R&D investments have gone up in nearly 40% of companies in 2010. In 2011, 43% of companies want to spend more on R&D than in the previous year.