| Author (Person) | Banks, Martin |
|---|---|
| Series Title | European Voice |
| Series Details | Vol.9, No.40, 27.11.03, p26, 28 |
| Publication Date | 27/11/2003 |
| Content Type | News |
|
By Martin Banks Date: 27/11/03 EUROPEAN Union leaders need to act now if they are to stand any chance of achieving their target of creating 22 million additional jobs in an EU of 25 member states. That was the verdict of Employment and Social Affairs Commissioner Anna Diamantopoulou, following the publication yesterday (26 November) of the final report by the EU's employment task force, headed by Dutch former premier Wim Kok. The 80-page report warns that both the EU-15 and the ten countries set to join the Union next May are failing to carry out the reforms necessary to create a more flexible labour market. Unless they implement changes now, the target of a 70% employment rate in 2010, agreed by EU leaders at the Lisbon summit three years ago, will remain a pipe dream. Kok's report has been described by an official in Diamantopoulou's cabinet as "electric shock therapy", designed to prod the 25 current and future members states into immediate action. The task force's findings were broadly welcomed by the Greek commissioner. "Its task was enormous, especially as it decided to include the ten new member states in its analysis. The result is very useful and should act as a catalyst for reform," she said. "It is sufficiently balanced to reflect the complexity of national situations and detailed enough to provide concrete suggestions." But she acknowledged that the 25 states have an uphill task. "They are faced with the twin challenge of addressing the current slowdown and paving the way for higher economic and employment growth. "The report rightly recognizes this. But it is important to recognize that, to achieve this, labour market reforms alone will not be sufficient. We need to act on both employment and productivity growth." Diamantopoulou identified two major measures required now to kick-start the EU's ailing labour markets. "First, the EU needs to relaunch employment growth towards our objective of full employment. "More than 22 million jobs still need to be created in the EU-25 by 2010 to reach our target of a 70% employment rate. With globalization and an ageing workforce, increasing the supply of skilled and adaptable labour and improving the working of the labour market are crucial. "Secondly, we need more people, working more productively: the EU must reverse the long-term decline in productivity growth. "This holds true for the new member states as well." Kok's task force was set up by the European Commission following the Brussels summit in March. The EU's big three, Germany, the UK and France, were at the vanguard of those calling for its creation. The team, consisting of the Dutch former prime minister and seven labour market experts, focused its work on four key areas where it considered reforms would have the strongest impact: adaptability of workers; the need to increase labour supply; investment in human capital and better governance. The aim of the taskforce was to take stock of the present situation in the EU labour market and analyse the main reasons why the Union is at serious risk of not meeting some, and possibly all, of its employment targets. The report paints a largely bleak picture, stating, for example, that the employment picture for older workers gives "major cause for concern". Only four member states - Sweden, Denmark, Portugal and the UK - currently exceed the 50% target for employment of 55-64-year-olds. At the other end of the scale, Belgium Italy, France, Luxembourg and Austria have employment rates for this group of less than 33%. The new member states lag "far behind" even these figures. Kok says: "The EU will miss its 50% target unless it can increase the number of older workers in work by 7 million over the next seven years." He warns that progress is also needed if the Union is to meet an employment rate of more than 60% for women (it currently stands at 55.6%). He also calls on the EU to tackle labour market "barriers" experienced by the long-term jobless, the disabled, the low skilled and, in particular, non-EU nationals. There is a "striking gap" between the employment rates of non-EU nationals and EU nationals - on average 53% compared with 66%. "Too many people drift into long-term unemployment and inactivity," he says. That all adds up to Europe facing a "significant" job creation shortfall. "Since 1997, total EU employment rose by 11.5 million. The average annual rate of employment increase, therefore, during what was a period of economic growth, was 1.3%. "To reach an employment rate of 70% (the rate at which a country may be assumed to have full employment) by 2010, employment must increase by a further 15 million in the EU-15. "This implies an average increase in employment of 1.5% - greater than that seen between 1997 and 2002 - is needed at a time when the economic climate is less favourable," says Kok. The report recommends a series of reforms including:
Kok says the EU's objective of becoming the most competitive and dynamic knowledge-based economy in the world by the end of the decade looks a tall order. "These objectives were challenging when they were set in 2000 at a time when the EU was enjoying strong GDP growth and falling unemployment. "Since then, the economic outlook has shifted and the objectives seem even more daunting. "Unless member states step up their efforts, it is looking increasingly unlikely that the overarching goal for 2010, and the employment objectives, will be attainable." The task force believes that the EU's success or failure in meeting the employment targets hinges on the Union's response to the challenges of economic transformation and demographic ageing. "These issues demand that both existing and new member states review the way they use and develop their human resources. "They must ensure that short-term responses to the economic slowdown are compatible with policies to address the underlying and more important structural changes," Kok concludes. The report will be debated by EU employment ministers in Brussels on Monday (1 December) and the EU "Social Summit" on 11 December. Kok's main findings on the EU-25 are as follows: AUSTRIA Rates in line with 2010 targets, although employment of older workers is "particularly" low. Also needs to increase number of women in work. BELGIUM Employment rate remains markedly below EU average and "far from" the Lisbon targets. The employment rate for older workers is among the lowest in the EU-25, and for non-nationals is "strikingly" low. CYPRUS Employment rate well above average and share of foreign workers has increased "significantly" over recent years. CZECH REPUBLIC Unemployment has been slowly increasing since the mid-1990s to reach around 7.8%, and employment rate for older workers is low. Raising number of women and older workers is a priority. DENMARK The country's employment rates are well above the Lisbon targets and the country "stands out" as one of the world's best performers in innovation. A priority is to ensure adequate labour supply in the longer term. ESTONIA Unemployment rate of 8%, much of it long term. Estonia is estimated to be the country that will be most affected by the decline in the working age population resulting from demographic change. FINLAND Exceeds overall employment rate target set for 2005 but lags behind the target for older workers. Youth unemployment is "particularly high". FRANCE Employment rate for older workers (55-64) one of lowest in the EU, while unemployment is among the highest. Report recommends that France reduces use of early retirement and simplifies its regulatory environment for business, especially SMEs. GERMANY Overall employment rates and for women above EU average, but Germany still lags behind other member states on employment of older workers. Employment disparities between eastern and western parts of the country remain large. Urged to find ways of encouraging people to stay in work longer and remove tax dis-incentives for women. GREECE Has one of lowest employment rates in EU for women, and overall high unemployment. Undeclared work is "substantial" and labour productivity remains low. HUNGARY There are major labour-market imbalances between the central and western regions, where the "modern economy" is concentrated. The health of workers is also an issue of concern, states the report. IRELAND One of EU's best performers. Employment rate since 1997 rose from 57.5% to 65.7%, while long-term joblessness fell from 6.1% to 1.3%. But action still needed to foster a stronger regional balance in employment. ITALY Near the bottom of the class. Regional gaps remain "substantial", with unemployment at 5% in the centre-north, compared with 18% in the south. Task force says it has to transform "significant" volume of undeclared work into regular employment and raise attractiveness of part-time work. LATVIA Unemployment remains high (12.4%) and net emigration is taking place. At the same time, labour and skill shortages exist in the capital, Riga. LITHUANIA The unemployment rate has fallen significantly to around 12.3% this year. Low share of employment in services remains a challenge. LUXEMBOURG Employment rate healthy, though still below 70% target, with long-term unemployment one of lowest in EU. Economic dependency on jobs in financial services "particularly high". MALTA Employment rate of women lowest in the EU-25 with only a third of those of working age in jobs. Employment of older workers also very low. NETHERLANDS Labour market characterized by an "exceptionally" high level of part-time work (44% of workforce) and employment rate of older workers exceeds EU average. More required to improve low employment rate of non-nationals and minorities. POLAND Particularly low employment rates for women, older workers, young people and the low-skilled, says task force. Calls on biggest accession state to reduce labour costs, review its tax-benefit system and develop coherent lifelong learning strategy. PORTUGAL Already slightly exceeds EU employment targets for women and older workers, but low levels of productivity remain a "matter of concern". SLOVENIA Unemployment rate has been decreasing since 1998 and now ranks among lowest of the new members. Raising employment of people over 55 is a "clear" priority. SLOVAKIA Employment rate of women - young, old and low-skilled - is described as "particularly" low. Report states that increasing attractiveness of part-time work would help create more jobs. SPAIN In 1997-2002, Spain achieved the highest rise in employment rates in the EU. But joblessness remains well above Union average. Needs to provide greater access to labour market for young and immigrants. SWEDEN One of EU's "star" pupils, scoring well when it comes to employing women and older workers. But report says efforts "should be maintained" to avoid labour- supply constraints. UK As befits the world's fourth-largest economy, employment rates have remained stable despite global economic downturn. Unemployment levels "well below" EU average but productivity levels - especially as expressed per hour worked - remain comparatively low. Major article looks at the challenges facing the EU to meet its target of creating 22m additional jobs in an EU of 25 by 2010 in the context of the publication of its final report, 26 November 2003 of the European Employment Taskforce (President: Wim Kok) |
|
| Related Links |
|
| Subject Categories | Employment and Social Affairs |
