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The European Commission calls on euro-area members to reduce public deficits and debts, taking advantage of the current robust economic growth. In 2006, the euro-area economy saw its fastest growth rate since 2000. Employment also grew, pushing the overall number of new jobs created since 1999 to 10 million – more than generated in the US in the same period.
"Policy makers must strike while the iron is hot, and step up their efforts to put public finances on a sound footing", said Economic and Financial Affairs Commissioner Joaquín Almunia on 3 May, presenting the Annual Statement as a political statement focusing on the policy challenges faced by the euro area as a whole.
The governments of the 13 countries of the euro area should avoid expenditure overruns and use unexpected extra revenues to reduce government deficit and debt, according to the Statement. Most euro-area members have not yet reached their medium-term budgetary objectives – which are more ambitious than the requirement to remain below the public deficit ceiling of 3% per GDP set by the Stability and Growth Pact.
In addition, governments are called on to take advantage of economic "good times" to further implement structural reforms, especially labour market and pension reforms.
In 2006, the euro area grew by 2.7%, which is well above its long-term average. Employment growth also accelerated, reaching around 1.5%. In absolute terms, close to 2 million new jobs were created in 2006. With this increase, the overall figure of new jobs generated since the introduction of the euro in 1999 reached 10 million – this is more than were created in the USA over the same period, according to the Annual Report on the Euro Area, the analytical report complementing the Statement.
The employment rate of older workers (those aged between 55 and 65) and women increased substantially. Between 2000 and 2005, the number of older workers increased by six percentage points to 40.4%. The employment rate of women went up by four percentage points, with Italy and Spain doing especially well (+ 7 points) and Italy (+ 3.9 points).
Getting more women and older workers into employment was one of the major goals of the Growth and Jobs Initiative, adopted at the Lisbon European Council in 2000, when Heads of State and Government agreed to push the employment rate of women to 60% and that of older workers to 50% within ten years.
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