Economic woes may derail jobs market

Date: 06/09/01

By John Shelley

Commissioner Anna Diamantopoulou will warn in her annual employment package next week that the EU's success in creating new jobs could be derailed by a global economic downturn.

In a report due to be released next Wednesday (12 September), she will tell member states that the Union will reach its ambitious target of full employment by 2010 only if they redouble their efforts to expand the jobs market. "It is absolutely undeniable that there is a cloud on the horizon," said one Commission insider. "Looked at in isolation, labour market reforms are moving on apace but in the context of economic downturn and no prospect of a quick upturn it's all the more important that we accelerate our reform efforts."

Although the EU created three million jobs last year, bringing unemployment down to an average 8.3% across the bloc, Diamantopoulou is concerned that not everyone has shared in the successes of the past two years. In particular, young people aged between 15 and 24 and the over-55s are being left out in the cold.

She will also urge member states to ensure that progress in the employment rate for women - currently growing faster than that for men - is stepped up further.

While admitting that the employment situation across Europe is uneven, the Greek Commissioner will congratulate member states for making the most of the average 3.1% economic growth they enjoyed last year to create as many jobs as possible.

Workers' productivity also increased 1.6% in 1999. "We are now getting more people into work for the same amount of economic growth," said a Commission source.

But the employment and social affairs chief will attack member states for continuing to drag their feet on liberalisation of energy and transport markets and financial services, especially as growth rates are set to fall below 3% this year.

EU leaders pledged at the Lisbon summit in March 2000 to bring the overall employment rate across the bloc up to 70% by 2010. Last year it rose by just over 1% to 63.3%.

But they have also promised to get 50% of 55 to 64-year-olds into work. In 2000 the figure was still woefully low at 37.7%.

Diamantopoulou's annual jobs package will also contain a country-by-country breakdown including specific recommendations, often taken as criticisms, for each EU government.

Insiders say that the recommendations will not change greatly this year from last.

Denmark, Sweden, the Netherlands and the UK continue to be the star performers overall with employment rates already surpassing 70%.

The Commissioner's own country, Greece, and Italy still occupy the back marker positions with rates around 55%.

Commissioner Anna Diamantopoulou will warn in her annual employment package in September 2001 that the EU's success in creating new jobs could be derailed by a global economic downturn.