Leap of faith
In the IT sector we are not particularly waiting for projects to come along. It’s the qualified people with the necessary relevant experience to implement these projects that we need. That’s not really news. But the impact of this is getting bigger and bigger now that the fourth industrial revolution is gaining momentum. Lack of people is putting a firm brake on the growth of the sector. Companies as well as the government are missing out on a lot of added value.
We are now looking towards education, all eyes focused on the famous STEM directions. And thanks to initiatives like Coderdojo or Ghent CodeFever, our children may be able to program before they are out of their diapers. But unless we revise our vision towards child labor, it will take a while for all those people to become recruitable. Until then, we must make do with what we have.
More and more companies are taking a leap of faith. They start hiring people who do not necessarily have the right diploma, but show the right attitude. At the coffee machine of IT companies, I’ve met philosophers and even chatted with a novelist. Not necessarily the profiles you would expect, but no less driven and competent.
The government has understood this very well. Do you know the individual company training or IBO? It’s a project from the public employment service of Flanders, VDAB, that encourages training on the job. Often for bottleneck professions. In return, the participating companies pay only a part of the wage instead of any RSZ contribution. The VDAB adds financial support with the help of the Flemish and European government. The people involved usually end up working for the company that trained them. It is a nice initiative that is being used by a growing number of companies.
Codit is again hiring people through IBO contracts. We are in a niche sector. The knowledge and experience needed here is not taught in school. We invest heavily in the training of our people, ensuring that they can participate within a short period of time. Therefore, I can only welcome initiatives like IBO.
The government as a pacesetter? I’m not complaining. Even though we should remain watchful. I learned at school that you need to be very careful with subsidies. Government support should at most be a temporary stimulus, because an economy based on subsidies will not work in the long run. It should never be a structural solution, as this would have upsetting effect on the market. Or worse: it creates a market where there may not be any.
There is a simpler way to get companies to take more risks and to invest: by finally reducing corporate taxes. Why do we continue to delay this?
Perhaps because the government benefits the most from all these subsidies and support measures. And I don’t necessarily mean the amount that is flowing back to the treasury in a second phase, but the amount that is not being spent in the first place.
Ultimately, it costs the government a lot less to grant subsidies to individual companies, for example, than to immediately lower corporate tax for all. To get subsidized, of course, you need to spend time and effort on the paperwork. And be well informed. It can be hard to see the forest for the trees. Many companies — and especially SMEs — do not even bother, causing the government to spend relatively little. However, a corporate tax reduction is a measure that benefits all without any trouble to them, while having a major impact on the income side of the government balance. At least in a first phase, before it’s going to bring returns.
Because in the longer term, another picture emerges: by lowering corporate tax, investments will go up. I do not believe that the savings will end up in the pockets of shareholders. Companies that invest wisely will use the available money towards hiring more people, training existing employees, innovating, and so on. In short, towards the profitability of their organization. And such investments will give a serious boost to the Belgian economy.