Engineering education has been available at TalTech for over a century, but the engineer shortage is becoming an increasingly serious issue.

Engineers and skilled workers in the industrial sector dominated the list of Estonia's most in-demand job positions at the recent Industry 5.0 conference. Currently, Estonian university graduates meet only one-third of the demand for managers and specialists in manufacturing.

The Engineering Academy

The Engineering Academy, which was established at the end of last year with support from European Union structural funds, aims to provide additional support for the promotion of engineering education and curriculum renewal. Over the next five years, this measure will provide 37.5 million euros to Estonia's higher and vocational education. The goal is to increase the number of engineering students and vocational trainees, lower dropout rates and improve curriculum alignment with labour market needs. The next five years are expected to significantly improve the quality of education and increase the number of specialists that companies are currently actively seeking or competing to hire from one another.

The root causes of why we have so few engineers lie within the entire education system. These issues begin in basic school and upper secondary school and continue into vocational and higher education. Engineering has not been as popular among university students as medicine, information technology, law or business management. Unfortunately, some startups and parts of the IT sector have recently contributed to shaping a negative attitude towards higher education in the media, promoting entrepreneurship and risk-taking over knowledge and a longer academic path.

Apart from artificial intelligence, the most significant changes today are taking place in the industrial sector. Companies facing challenges from the green transition and automation are developing new business models, areas of activity, materials and collaborations with other sectors to address societal challenges. In a world with an increasing population and limited resources, new production possibilities and operational models are required, which IT development alone cannot provide.

The voices of Estonian industrialists who advocate for purposeful economic policy is growing stronger. The future needs to bring with it the creation of new jobs, reorienting industry towards more export-oriented sectors and establishing priorities regarding which industrial sectors should be prioritised in Estonia.

Universities and applied (professional) higher education institutions, in partnership with the vocational education system, are ready to contribute to this effort. Heads of the curriculum are paying close attention to the needs of the industry and providing opportunities for students to engage in more problem-solving and challenge-based learning.

Students today have more opportunities to study and gain modern knowledge in fields not yet taught in Estonia owing to the collaboration between Tallinn University of Technology and the largest universities in Europe that offer technology and economics education through the EuroTeQ network. Moreover, microdegrees and future microqualifications provide opportunities for quick, need-based retraining.

In the field of energetics and green energetics, the university would need to establish its own research group focused on energy storage technologies and energy process modelling.

However, in order to make a greater leap, the Engineering Academy must not be an end in itself and greater endeavours must continue beyond the support period. According to Tallinn University of Technology's calculations, the Engineering Academy contributes an additional 2.2 million euros per year to improve the quality of engineering education at the university, accounting for less than 2% of the total budget. This allows for promotional activities, helping students cope with their studies and curriculum adjustments to better meet the needs of the job market, but nothing more.

This additional funding does not allow for the establishment of educational activities in completely new engineering fields, which have become necessary as a result of rapid global development over the last decade and are also needed by Estonian industry.

In the field of energetics and green energetics, the university would need to establish its own research group focused on energy storage technologies and energy process modelling. It is also necessary to establish a research group that will focus on issues and opportunities related to the reliability and energy efficiency of the electrical system. With the growing adoption of environmentally friendly cooling technologies, a refrigeration and thermal engineering research group specialising in heat and mass transfer will be required in the near future. This kind of group would support the wider implementation of district cooling, as well as river and marine water cooling technologies.

To automate industrial and manufacturing processes and design more energy-efficient buildings, industrial and building automation and electronics research groups should be created as soon as possible. The construction sector expects TalTech to strengthen the critically diminished fields of structural engineering, road and bridge construction and construction and composite materials and add more staff professorships in them.

Employers urgently require partners in all of the aforementioned fields to revive economic growth. The university must make bold decisions to prioritise the development of these areas while also establishing new priorities among academic fields. This includes significantly increasing the proportion of funding for engineering at the university.

We estimate that in order to develop the aforementioned and several other research and academic fields that are critical for economic development, the university would need to invest at least 500,000 euros per field for at least five consecutive years If the goal is to establish ten new research groups, an annual investment of five million euros is required.

Private funding is also needed

In addition to the aforementioned funding, private funding through targeted donations is both possible and required to create and reopen necessary engineering curricula. The Aalto University endowment fund contributes 13% of the university's budget on average each year and the funds are solely dedicated to developing and supporting economic study programmes. The endowment fund's creation and growth have been greatly aided not only by corporate contributions, but also by a supportive national strategy that multiplies the fund's private capital collection. This strategy could also be implemented in Estonia.

According to a recent report by the Foresight Centre, Estonian businesses only use a small portion of the tax-free donation allowances available to them. In 2022, organisations on the list of income tax-exempt entities received a total of 27.8 million euros in donations. There are 109,324 businesses that could donate more than 950 million euros. As such, the potential is substantial.

In addition to awarding named scholarships on behalf of companies, the TalTech Development Fund intends to strengthen the fund by creating sector-specific endowments to fund curricula, professorships and research groups. The ambition of the Development Fund is supported by data from the aforementioned report and the willingness of companies in need of engineers to contribute and direct funds towards teaching in-demand specialisations.

The TalTech Development Fund's endowment for engineering education, which will be established by the end of this year, aims to raise at least 10 million euros through targeted donations over the next few years. Assuming an annual return of 8-10%, this endowment alone could cover the costs of two academic fields per year.

Currently, up to two-thirds of engineers are absent from many key industries in Estonia. It is possible to address the skilled labour shortage in ten years by making strategic decisions in engineering education and improving the use of both public and private funds. As a result, the university's research capabilities will improve, the number of full-time contributing professors will rise and engineering education will expand into fields of increased interest to employers.

Many European countries are increasing funding for universities of technology in light of the current economic uncertainty. Graduates from these universities add value to the labour market, increase the country's export capacity and allow the State Treasury to provide significantly more services to society. Our university funding model should increasingly be based on how much they contribute to the real economy, higher wages and national competitiveness.