The Best and Worst Places to Hire in Europe

News Release
For more information:
hmiskin@tcb.org  

The Best and Worst Places to Hire in Europe–Agility Beats Scale as Major Economies Falter

Brussels, January 12 2026…Europe’s largest economies are failing to convert talent into jobs, according to the inaugural Where to Hire Index from The Conference Board. Germany, the UK, France, Italy and Spain all risk losing out in the race for jobs, as aging populations, slow digitalization, and high costs cause major employers to consider more agile, innovative-driven alternatives.

Talent remains Europe’s greatest asset, according to the Index, a comparative analysis across thirty-one countries of what C-Suite executives believe drives investment decisions. But Europe’s biggest economies are unable to turn their deep pool of skilled labor into jobs and growth because political inertia and regulatory friction are blunting their competitive edge. Smaller countries in the Nordics and Western Europe offer the most competitive labor environments. But even the leaders–Denmark, Switzerland and Ireland–face challenges, with competition from a rising cohort of Central and Eastern European reformers.

“The Index is an alarm call to European leaders about how political paralysis and poor regulation is upending Europe’s competitiveness,” said Jean-Marc Verbist, Human Capital Center Leader Europe, The Conference Board. “Europe’s largest labor markets are hitting a structural breaking point. They have the skills, but not the competitiveness to match them. For workers, this means something tangible: job creation increasingly flows to markets offering speed, simplicity, and digital readiness. Artificial intelligence will accelerate this shift. AI-focused businesses will favor countries that quickly adapt education, regulation, and corporate practices. Those that cannot will see a widening gap between the skills they produce and the jobs they can attract.”

SMALL COUNTRIES DOMINATE: TALENT OUTWEIGHS COST

Multinationals will pay for talent when the operating environment is right. Employers in Denmark, Switzerland, Ireland, Sweden, and Finland pay more, but benefit from highly skilled, reliable, and efficient workforces.

• Denmark (Rank 1): Exceptional skills, efficiency, and institutional strength deliver Europe’s most competitive labor market–but an aging workforce raises long-term concerns.
• Switzerland (Rank 2): World-leading talent and trusted institutions sustain exceptional productivity, despite high costs and tight labor supply.
• Ireland (Rank 3): Globally oriented talent and a flexible labor market attract major investment, though rising costs and infrastructure pressures limit scalability.
• Sweden & Finland (Ranks 4 & 5): High skills, strong institutions, and advanced digitalization drive competitiveness, but shrinking labor-market slack may curb future agility.

SKILLS VS. COMPETITIVENESS: EUROPE’S STAGNANT GIANTS

Talent is not Europe’s problem; competitiveness is. Germany, the UK, France, Italy, and Spain all possess large talent pools, sophisticated institutions, and strong industrial or services bases, yet falter turning these into agility and productivity-led growth:

• Germany (Rank 10): World-class technical talent is offset by weak productivity momentum as aging demographics and slow digital adoption blunt historic strengths.
• UK (Rank 12): A flexible labor market and solid skills base are overshadowed by persistent productivity stagnation and post-Brexit uncertainty.
• France (Rank 17): Strong public investment in talent is undermined by rigid labor rules and high taxation, widening the gap between capability and competitiveness.
• Italy (Rank 20): A respectable skills base is overtaken by deep structural hurdles: low productivity, weak governance, and one of Europe’s most stagnant labor markets.
• Spain (Rank 22): A dynamic services economy is constrained by structural barriers, with competitiveness and high youth unemployment limiting labor potential.

CENTRAL AND EASTERN EUROPE: REFORM DRIVES INNOVATION

A rising cohort of Central and Eastern European reformers is gaining ground.

• Lithuania, Estonia, Latvia, and Czechia (Ranks 13, 14, 16 & 17): Rising education standards, digital capability, and EU integration position them as efficient expansion hubs for multinationals.

A STRATEGIC TOOL FOR EUROPE’S LARGEST EMPLOYERS

The Where to Hire Index™ consolidates 100 indicators from multiple sources, offering a comprehensive view of structural conditions shaping Europe’s workforce competitiveness.

• The ranking reflects assessments by CHROs and senior HR leaders from twenty-four multinationals across ten drivers of labor attractiveness.
• Collectively, these executives oversee about 2.15 million workers, generating over €880 billion in annual revenue.

“Employee-employer relationships have significantly changed over the past five years, and employers are expected to offer more flexible conditions, including remote or multi-location work,” said Guergana Andreeva, Senior Vice President, People & Culture and Corporate Security, JTI. “Current European policies do not fully support such flexibility. This affects companies’ ability to attract talent with limited mobility across Europe. It is one reason we are moving closer to where the talent is, and the ‘Where to Hire: Europe 2026 Index’ helps us better understand the marketplace.”

About The Conference Board

The Conference Board is the member-driven think tank that delivers Trusted Insights for What’s Ahead^®®. Founded in 1916, we are a non-partisan, not-for-profit entity holding 501 (c) (3) tax-exempt status in the United States. TCB.org