In her 2021 State of the Union address, European Commission’s President Ursula von der Leyen announced that “[the EU] will invest in 5G and fiber. But equally important is the investment in digital skills.” Indeed, the EU Recovery and Resilience Facility, which runs until 2026, has earmarked substantial funds to tackle the digital divide, in acknowledgment of the fact that the EU is not only missing ICT specialists but also that many Europeans do not have sufficient digital skills to thrive in today’s society and labor market. Many observers argue that older workers in particular lack digital skills, suffering more often from computer anxiety and showing lower computer self-efficacy (Czaja et al. 2006). This lack of skills hampers their employability and productivity in a technologically fast-changing world.

We examine how firms adapt their organization when they go public. To conform with the requirements of public capital markets, we expect IPO firms to become more organized, making the firm more accountable and its human capital more easily replaceable. We find that IPO firms transform into a more hierarchical organization with smaller departments. Managerial oversight increases. Organizational functions dedicated to accounting, finance, information and communication, and human resources become much more prominent. Employee turnover is sizeable and directly related to changes in hierarchical layers. New hires are better educated, but younger and less experienced than incumbents, which reflects the staffing needs of a more hierarchical organization. Wage inequality increases as firms become more hierarchical. Overall, going public is associated with a comprehensive transformation of the firm's organization which becomes geared towards efficiently operating a public firm.