Europe’s Vanishing Talent: Is the Old Continent Losing Its Strategic Edge?

Benoit Lison is Managing Partner of Amrop Belgium. Below he shares his perspectives on the structural risks facing the European economy due to accelerating geopolitical shifts and the decentralization of once predominantly Western European leadership pipelines.

Once a key competitive advantage, Europe's talent base is eroding due to offshoring and decentralization of strategic roles to offshore and nearshore locations.

Rodion Kutsaiev Ij25m7fxqtk Unsplash

Growing Anxiety

“In recent discussions with CEO’s and CHROs across several internationally active organizations, one theme which has surfaced consistently is the growing anxiety around the structural risks facing the European economy in the face of accelerating geopolitical shifts,” shares Lison. “While much has been said about energy security and industrial policy, an equally pressing - yet underexamined - issue is emerging which is the erosion of Western Europe’s talent base.”

Initially, concern centered on industrial competitiveness. The offshoring of manufacturing activities to low-cost regions, driven by short-term financial optimization, has hollowed out Europe’s production capacity. The consequences are now clear: diminished infrastructure, overregulation at home, and an increased dependency on external supply chains and capabilities. 

“However, today, the conversation is no longer limited to factories and physical goods,” Lison continues. “A growing number of leaders are sounding the alarm over Talent Risk - a quiet yet powerful downward shift where strategic knowledge, leadership, and innovation capabilities are not being developed and retained.”

Talent: Once Europe's Unrivaled Asset 

For decades talent was considered one of Western Europe's most valuable assets - a defining competitive advantage in a globalized world. But this assumption is now being challenged. 

“More than twenty-five years ago, companies began embracing offshoring and nearshoring strategies,” Lison explains. “Initially, these moves aimed to relieve Western operations of non-core support functions such as software development, procurement, and accounting. Asian and Central European countries became key locations for these tasks, supported by well-educated, ambitious young workforces.”

These structures were initially probably not meant to replace Western operations, however, as the activities of these off- and nearshore centers expanded and more complex tasks were assigned to them over the years, the local talent was given the opportunity to develop significantly - often supported by the presence of strong educational institutions and universities, allowing them to start climbing in the career ladders. In parallel, major companies  started to create offshore Talent Hubs and entire companies began relocating outside of Western Europe, further accelerating the diffusion of strategic roles. 

“Today, what began as a support structure has evolved into a steering mechanism,” Lison is convinced. “We can start to discover that Talented professionals who started their careers in near- and offshore locations more and more got the opportunity to grow in the ranks and evolved into more strategic positions. Leadership pipelines that once flowed through Western Europe are now increasingly centered elsewhere.”

In parallel with industrial decline 

“The comparison to Europe’s industrial decline is striking - and cautionary,” Lison suggests. “The initial logic of outsourcing was sound in financial terms, but over time, the cumulative effect was the loss of critical competencies, manufacturing know-how, and innovation infrastructure. As the global geopolitical environment shifts, Europe finds itself struggling to "reshore" its industrial base, a task far more complex and costly than originally anticipated.”

Could the same happen with talent? 

“If geopolitical tensions lead to reduced global mobility, or if regions close themselves off due to strategic decoupling, Western Europe might no longer  have access to the human capital it once considered abundant,” Lison concludes. “More importantly, it remains an open question whether it will able to rebuild it quickly enough to remain competitive. The early signals suggest a sobering reality: rebuilding talent ecosystems is just as difficult - if not more so - than restoring industrial capacity.”

Key Takeaways

Western Europe's talent base, once a key competitive advantage, is eroding due to offshoring and decentralization of strategic roles to offshore and nearshore locations.

Geopolitical shifts and increased global mobility restrictions threaten Western Europe’s access to strategic human capital, raising concerns about future competitiveness.

The evolution of talent development mirrors Europe's industrial decline, highlighting the loss of critical skills, innovation infrastructure, and leadership pipelines.

Rebuilding European talent ecosystems is likely to be more challenging and time-consuming than restoring industrial capacity, posing significant risks to economic resilience.

The Meaning of Work: An Amrop Global Study

Read the full report

Further Reading: The Meaning of Work

Amrop's latest global survey, The Meaning of Work, explores attitudes towards work around the world, revealing apparent shifts in the ambition for leadership, particularly among Western European professionals. In countries like Germany and the UK, young executives placed half as much importance on managing a company in the future as their counterparts in the Global South countries of Brazil, India and China.

What has changed in western ambition? And what does it mean for the future of leadership, and for the future of talent?