Download Adaptability in the EES

1st EU-Brazil civil society Round
Table 7-8 July 2009
Brussels
Egbert Holthuis
European Commission,
DG Employment, Social Affairs and Equal Opportunities
Commission européenne
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Economic crisis: Labour markets deteriorating
Sharp rise in EU
unemployment since
March 2008
 UR ↑ 1.8 pps in
1 year to 8.6%
(i.e. by 4.7 million to
∼21 million overall)
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• For all MS* UR is
higher than a year ago
• particular rise in Baltic
states, Spain and
Ireland (12.5 - 5.9 pps)
• Men are more effected,
especially young ones
• unemployment in the
EU less affected than in
US (↑ 1.8 vs. 3.9 pps)
+
Declining numbers of
job vacancies
Firms’ employment
expectations remain
negative
*Where recent data is available
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Outlook remains bleak
Chart 20: Forecast employment growth
Commission forecasts:
•
•
•
•
•
•
EU GDP ↓ 4% in 2009
to stabilise in 2010
Employment ↓ 2.6% in
09 and ↓ 1.4% in 2010
So 8½ ml jobs lost,
vs. net job creation
9½ ml 06-08
UR ↑ to 9.4 (09), 10.9
(10)
Baltics, Ireland and
Spain (more than
20%) hit hardest
In line with other
international forecasts
(IMF, OECD…)
Chart 21: Forecast unemployment rates
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Policy response to the crisis
• Stimulate public demand to avoid downward spiral
• EU Economic Recovery Plan (December 2008): MS
fiscal stimulus packages (target of 1.5% of Union's
GDP) including automatic stabilisers/ income support
estimated 3.3% GDP
• Invest in future competitiveness - infrastructure,
broadband, green jobs and upskilling of workers
• Reinforced financial supervision
• Focus on respecting internal market and state aid
regulation
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Measures taken by Member States
(MS) to increase labour demand
• Reduce non-wage labour costs/ soc. sec.
contributions
• Preserve existing jobs
– Short time working arrangements
– Support to badly hit sectors
• Investments infrastructure
• VAT cuts
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MS actions to support income
•
•
•
•
Expanding eligibility rules
Increase social benefit levels
Fiscal help for low earners
Support for education and vocational
training
• Targeting household over-indebtedness
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Active labour market policies
• Use integrated policy approach
• Increase efficiency (better targeting): focus on
matching and selected groups like the young
• Support transitions education/work,
inactivity/work, job/job
• Avoid long term unempl, make work pay
• Support mobility of workers and job seekers
• Develop and monitor policies with
stakeholders especially social partners
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Role of the EU
• EU economic recovery plan 12.08
• Reinforce financial supervision (G20)
• Respect state aid regulation + Internal
market
• Frontloading European social funds
• Key role EU social partners
• Focus on selected priority themes
• Mutual learning with and between MS
Commission européenne
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Structural challenges
• Importance knowledge and education gap with
US
• Dual labour markets in EU and (regional)
inequalities
• Crisis risks to increase segmentation and
(permanent) exclusion
• Mitigation climate change costly
• Ageing: dependency rate, retirement
provisions, health and long term care
Commission européenne
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Structural challenges
• Importance knowledge and education gap with
US
• Dual labour markets in EU and (regional)
inequalities
• Crisis risks to increase segmentation and
(permanent) exclusion
• Mitigation climate change costly
• Ageing: dependency rate, retirement
provisions, health and long term care
Commission européenne
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Issues for the debate
• How to best reinforce role civil society in designing
recovery measures
• How to best maintain people in employment while at
the same time foster adaptation capacity of companies
• How to combine activation and adequate income
support (rights and duties)
• How to maintain investing in training and skills
upgrading despite reduction government budgets
• How to maintain migration/free movement channels
How to best tackle youth unemployment
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Thank you very much for your
attention
More information:
http://ec.europa.eu/social/
Commission européenne
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