BPIE’s Climate Conversations series shares a diverse range of perspectives on buildings and climate policies from a wide variety of experts. We seek to explore solutions and illuminate blind spots related to reducing the climate impact of buildings – and pushing for a just transition that leaves no one behind.

Upskilling and growing the workforce in renovation and construction is fundamental to scaling up renovation rates that will help the EU achieve its climate goals. At the same time, skills and education are foundational to strengthening the social fabric and ensuring a fair and just transition. You can’t do one without the other.

Anđelka Toto Ormuž represents Rockwool Adriatic, a stonewall producer, and the HUPFAS Association, a Croatian industry association for 18 companies specialising in buildings’ facades. The association’s goal is to raise awareness about the need for energy efficiency in the construction sector, and  to contribute our technical knowledge where needed. HUPFAS seeks to help legislators in their decision-making, but also all other relevant stakeholders in the process of energy renovations of buildings.

In this discussion with Anđelka, we consider how the skills shortage has affected Croatia’s National Recovery and Resilience Plan, and discuss why educational systems are lagging behind the market demand for skilled construction workers. We also reflect on the lessons learned from the 2020 Croatian earthquake about the new skills required to make buildings both energy-efficient and resilient.

BPIE: Anđelka, can you tell us about how the skills shortage is affecting the rollout of building renovation in your country, Croatia?

Anđelka Toto Ormuž: I recently spoke to some people from the relevant Croatian ministries for the construction sector, and we remarked that Croatia has never had so much money earmarked for renovation. In the next three years alone, we will have more than €2 billion from the National Recovery and Resilience Plan. Of course, we are pleased that buildings’ renovation has been recognised as a key element in achieving our climate and energy goals. On the other hand, we are concerned because we don’t know where we will find the workforce to deliver these projects.

After Croatia joined the EU in 2013, there was an exodus of workers towards Western European countries. The majority of these workers had vocational occupations, many in the construction sector. So when we got all this funding to renovate our buildings, the biggest bottleneck was the lack of labour, particularly a qualified labour workforce. And then, especially in the past two to three years, we’ve witnessed a massive movement of workers from Asian countries to Croatia to work in the construction sector. This brings a language barrier challenge, and these workers are also coming from countries with a completely different construction sector and different technology landscape.

But the root problem is that our educational system does not follow the market reality. Study programmes at universities and colleges don’t equip students with the competencies and skills they will need when they enter the workforce. The situation now is that when they enter the market with these diplomas in architecture, civil engineering, computer science, or mechanical engineering, they still need additional training while working. This is a cost for the employer and requires input from existing employees as well.

Our educational system does not follow the market reality. Study programmes at universities and colleges don’t equip students with the competencies and skills they will need when they enter the workforce.

Education and training to match political commitments

BPIE: There’s a big political push to increase renovation under the EU Green Deal and the Renovation Wave – do you see any evidence of increased efforts to boost education and training to match these political commitments? Has there been any progress in that area?

Anđelka: HUPFAS was one of the partners in the EU- funded project called Build Up Skills – this was called Cross Skills in Croatia and is now in a second phase called Cross Skills Upload. In the first part of the project, our association brought together companies with extensive knowledge of building facades’ installation. We published guides for vocational education trainers of installers, roofers, carpenters, electricians, and other trades. We also participated in a nationwide schools roadshow, and equipped some classrooms with materials. The project also trained the trainers, and taught them technical tips and tricks. It demonstrated that the industry has the willingness and capacity to help.

BPIE: Is there sufficient demand from young people for jobs in renovation and construction? If not, how can this be addressed?

Anđelka: This is a problem across Europe because young people see jobs in renovation and construction as physically intense and underpaid. The industry is not attractive to them. But the sector is changing. Being an installer today is a very different job to what it was 10 or 20 years ago. The technologies have improved and helped make these jobs less physically intense.  

I see a significant role for government because they need to completely change the educational system to make vocational education more attractive. There’s also a big role for industry, for example in companies investing more in scholarships, which would reduce the financial burden for students, especially for those studying away from home or studying abroad. We can all participate and contribute to making education more attractive, and ensure that students are appreciated, and can see that they are really contributing to the bigger goals that we all have.

Government needs to make vocational education more attractive. And companies should invest more in scholarships, which would reduce the financial burden for students.

Legacy of the European Year of Skills

BPIE: We are now coming to the end of the European Commission’s European Year of Skills. What do you think the biggest impact of this effort has been?

Anđelka: The Year of Skills is an important initiative. The first step to solving a problem is to be aware of it. Everybody needs to be aware of this problem, to understand the reasons for the problem, and to then focus on finding solutions. We all know that the EU has set really ambitious goals for the building sector which are legally binding. It’s not optional – each Member State must accomplish this Green Deal and these climate goals. I believe this year dedicated to the question of skills  has significantly contributed to raising awareness and making links between the importance of skills and training on the one hand, and our climate goals on the other. Think tanks like BPIE are talking about it and asking questions – so we are moving in the right direction.

But the question of skills is not only about the climate and CO₂ and decarbonisation. It’s about people, and we need to make these links and continue to stress the urgency of taking action where there are gaps, beyond the Commission’s Year of Skills. We all live in buildings and spend the majority of our time inside. It really matters what kind of buildings we live and work in, and in which we heal or teach our kids. We will not be able to improve the quality of our buildings without people who are skilled. Energy poverty is also a huge problem. And we will not be able to lower the number of people who struggle with their energy bills every month without skilled people. With the right level of skills, we will solve or diminish the many layers of these complex challenges.

BPIE: What’s the link between skills and training, and ensuring that we meet our climate objectives? And what are the consequences if we don’t invest in these skills?

Anđelka: There is no doubt that without energy-efficient buildings we will not be able to achieve our climate goals. And without skilled people, we will not be able to renovate buildings in the appropriate way. This takes us back to the education system. There needs to be a dramatic improvement. Faculties and courses need to be adapted and focus on the skills and trades required for the renovation of buildings or new construction.

I recently participated in a workshop organised by Advantage Austria, the official representative of the Austrian Ministry of Economy in Croatia. It brought together people from the Austrian and Croatian construction sectors, and it was amazing to see how much more we still have to learn – and not just those of us in the construction industry! For example, people at the local authority level are investors. They are investors when they decide to renovate a local hospital or a school. But they don’t always understand the legal requirements and how these legal requirements can and need to be achieved. And then there are commercial banks – they will need a deep understanding of what’s in a project, whether it contributes to decarbonisation, the lifecycle assessment, all these things. There is so much that we need to learn.

A lot of NGOs here in Croatia contribute to knowledge-sharing and training of different professions. They present new trends on technical and legal aspects of the industry. Skills, lifelong learning and a reformed education system are necessary. Without raising awareness, we won’t achieve an understanding of what these climate goals are about and what is involved in reaching them.

Lifelong learning and reskilling

BPIE: Regarding lifelong learning, are there other resources there now for the kind of upskilling or reskilling of people who have already been in the workforce for ten, even twenty years? Is there a lot of work to be done, or is there some progress?

Anđelka: I see a lot of progress here in Croatia. For example, the Croatian Green Building Council has set up a training program for building professionals. It is a platform of competent people from industry and academia, and it organises education for people returning to education. There are also a lot of initiatives coming from the employers‘ association, and the Croatian Chamber of Commerce. So, I do see progress, and that’s a very positive thing.

BPIE: Are there aspects of lifelong learning and reskilling that the Croatian government is not focusing on? What are the blind spots?

Anđelka: I recently read that the Croatian government views the problem of a lack of a qualified labour force in terms of highly educated people such as architects, civil engineers, mechanical engineers, electrical engineers, etc., and that there will be a need for more of these people. But at the same time, the universities have not increased the number of places for students in these programmes. The government can conclude that there is a labour shortage, but if the education system is not aware of this or doesn’t respond with action, then we will continue to have a skills gap.

BPIE: You mentioned that the job of an installer today is very different than it was ten or twenty years ago. How are jobs or skills in this sector changing? What is relatively new that people might not expect in the construction and renovation sector?

Anđelka: As someone coming from a company that produces insulation materials, I can see the progress and how the concept of work has changed. For example, a lot of new technologies have been introduced in the production process to make jobs less labour intensive. And, of course, the digitalization process is also happening in the industry.

Building resilience

BPIE: What are other new aspects, especially in Croatia?

Anđelka: Croatia was hit by two major earthquakes back in 2020, and some 60,000 buildings were severely damaged in Zagreb. We were then faced with another problem: a lot of buildings needed to be renovated to improve their energy performance while also improving their resilience to seismic activity. This created a new skill – how to do it in one shot, how to improve the building’s energy performance and seismic resilience at the same time. Because if you only improve the energy performance of the building and then it collapses in an earthquake, it’s a complete failure. It’s a loss of finance, time, effort, everything. Additionally, the procedures and administration for reconstruction needed to improve, requiring completely new skills and knowledge.

So when we speak of skills, it’s not just people with tools in hand working in the building – it’s also about the administrative skills required to make these projects run smoothly. Otherwise, we have the problem of projects being stuck due to waiting for one document. Who knows what we will face in the future, but we need to be flexible and aware that we don’t know everything.

When we speak of skills, it’s not just people with tools in hand working in the building – it’s also about the administrative skills required to make these projects run smoothly. Otherwise, we have the problem of projects being stuck due to waiting for one document.

BPIE: How is the reconstruction effort going? Did the earthquakes change industry and government policy?

Anđelka: Yes. The earthquakes not only physically shook our part of the globe here – they brought to light many things that were swept under the carpet, things that we had tried to ignore. We were thinking that the problems would solve themselves by some miracle. The earthquakes in Zagreb showed that we had systematically neglected buildings, and many building owners had ignored the obligation to maintain buildings. There is the right to property, but this right also comes with the obligation to maintain it. Since many buildings were not taken care of properly, the damage done to those buildings was much, much greater than to the buildings that were regularly maintained.

It took a lot of trial and error to systematically introduce a system to renovate these buildings. Ministers in charge of construction were replaced, and with each new minister a fresh impetus came, and some processes were improved and changes put in place.

Now we have a minister and team who, based on the legacy of the previous ministers, have achieved some amazing results. They used the EU Solidarity Fund for this reconstruction. There was a serious risk that by June 2024, the deadline for the funds to be used, that the funds would go unspent. But then the authorities sped up and streamlined some procedures. Zagreb is now a huge construction site. A lot of buildings in the centre are undergoing reconstruction. The centre of Zagreb, which was hit heavily, has a dense concentration of cultural heritage buildings which complicates renovation work. I think it will be a big success and a big learning opportunity. The European Commission has recognised and congratulated the Croatian government for being able to achieve all these goals using EU funds.

There is the right to property, but this right also comes with the obligation to maintain it. Since many buildings were not taken care of properly, the damage done to those buildings was much, much greater than to the buildings that were regularly maintained.

BPIE: In terms of ensuring that buildings are more resilient to future earthquakes, has there been a longer-term impact?

Anđelka: Yes, absolutely. I think that the resilience of buildings should be a buzzword for all of us in the construction sector. Because it’s not only about energy and emissions. Due to climate change, we are all exposed to potentially catastrophic floods, storms, heatwaves. Buildings play a really important role for people’s safety. Buildings need to be resilient, in terms of climate, as well as seismic activity and fire safety, among others.

Resilience should be a buzzword for all of us in the construction sector.