Skills Shortage Delay Green Transition Investments

The 2022 Municipality Survey by the European Investment Bank (EIB), covering 744 municipalities across the European Union, says 69% of municipalities lack experts with environmental and climate assessment skills, posing a serious problem for the implementation of local investment programs, including those in Hungary.

This comprehensive survey provides unique insights into past and planned investments, as well as the challenges municipalities face in their digital and green transitions, and the progress they have made in these domains. Since municipalities account for almost half of public investment in the European Union, these findings are of the utmost importance.

Investment gaps and challenges
A lack of funding, and uncertain and lengthy regulatory processes, continue to deter municipalities from planning crucial investments. Moreover, when it comes to implementation, a shortage of skilled labour and supply chain bottlenecks are significant constraints.

Skills shortage
The survey highlights the critical importance of providing necessary training to the current and future labour force. Municipalities report difficulties in securing experts with environmental and climate skills, as well as technical and engineering expertise. Addressing these challenges is essential for the successful execution of investment plans.

Focus on green and digital transitions
Climate change mitigation, adaptation, and digital infrastructure play a central role in municipalities' investment plans for the next three years. However, more than 60% of municipalities express dissatisfaction with their past investments in climate mitigation and adaptation, while 40% report dissatisfaction with their investments in digital infrastructure.

Regional disparity
European municipalities have come further with the digital transformation than they have with the green transition. While higher-income regions show a higher proportion of municipalities actively investing in both transitions, less developed regions face challenges in making similar progress.