New StepUp StartUps report: Shaping and strengthening European AI talent

The rapid advancement of AI is redefining the nature of work across Europe. AI talent, whether professionals directly employed in AI-related roles or those using AI skills in other fields, has more than doubled in the EU between 2016 and 2023, now representing 0.41% of the EU workforce.

Despite this progress, the global competition for talent remains fierce. Developing, attracting and retaining AI talent – and increasing AI skills more widely – is a defining challenge for Europe’s long-term competitiveness.

Growing demand and talent supply

Sectors with high exposure to AI such as ICT are already reporting faster economic growth, suggesting that AI adoption is fueling job creation rather than displacement. Nevertheless, by 2030, up to 6.5% of the EU workforce may need to transition to new occupations if AI is adopted at pace. Companies will face growing skill mismatches.

For example, demand for advanced IT skills, data analytics, and scientific research abilities is expected to rise while AI-driven workplaces will increasingly value critical thinking, creativity, adaptability, and entrepreneurship.

The EU already stands out as an AI education hub with 35% of all AI-related Master programmes globally offered by its universities and research centres, with Germany, France, and the Netherlands at the forefront.

Highly skilled graduates, combined with the growing involvement by major industrial companies and numerous smaller businesses and start-ups, are turning several EU Member States such as France, Luxembourg, Finland, and the Netherlands, into AI talent hubs. Germany likewise anchors talent home with the help of national champions. Strong policies, digital infrastructures, and international openness are also fuelling AI talent attraction in Ireland and Estonia.

Challenges ahead

Despite strong foundations, Europe faces several challenges. The gender gap is a concern: women represent less than one-quarter of AI engineers across Europe, and as little as 11% in some cities. Closing this gap will require stronger STEM education pathways, mentorship opportunities, and inclusive workplace cultures.

At the same time, Europe’s AI workforce is unevenly internationalised. While the EU attracts many foreign-trained professionals, most talent inflows concentrate in a handful of countries, notably Germany, which issued nearly 78% of all EU Blue Cards in 2023. This points to untapped potential in other regions to attract skilled workers from third countries.

AI-intensive sectors that are key to the EU’s economy also face sector-specific challenges:

• In healthcare, there is a double challenge of bridging gaps in basic digital skills, while developing advanced AI competencies.
• The energy sector is among the most affected by an ageing workforce, with over half requiring upskilling as 34% of jobs are expected to be reshaped by AI.
• In advanced manufacturing, AI applications depend on local industrial data that is often inaccessible, requiring hybrid AI-industry work profiles.
• The cultural and creative industries sector is integrating AI into content creation, immersive experiences, and data-driven business models, requiring artists and creatives to invest in new skills.

National strategies and European alignment

Many EU countries are already investing heavily in research networks, PhD programmes and cutting-edge computing resources in a bid to grow their AI talent pipelines and strengthen their ecosystems.

France’s €10 billion “France and AI” plan, Germany’s AI Competence Centres, and Portugal’s AI Portugal 2030 initiative, aimed at upskilling 1.3 million workers, are key examples.

The European Commission is also providing support in this area. Building on the ambitious actions of the AI Continent Action Plan, the Apply AI Strategy was launched in October 2025 to support the adoption and integration of AI in key strategic sectors.

The Apply AI strategy also includes initiatives related to the workforce such as support for increasing AI literacy among workers of all sectors and developing sectoral AI experts with multidisciplinary profiles for more digitally intense sectors. In addition, an EU-funded AI Skills Academy will be launched in 2026.

The report calls for further alignment between national and EU-level strategies, ensuring that local initiatives reinforce a shared European vision. Such coordination would strengthen Europe’s collective competitiveness while allowing each region to build on its own strengths.

Download the report here.