Brussels, 29 October 2010
€1.5 million from EU Globalisation Fund to help 1 154 workers in the Spanish retail sector
The European Commission has approved an application from Spain for assistance from the EU Globalisation Adjustment Fund (EGF). The € 1 560 000 requested by the Spanish authorities will help 1 154 redundant workers find new jobs. The workers lost their jobs after the Spanish retail sector was heavily hit by the economic slowdown. The application will now go to the European Parliament and the Member States (the EU's Budgetary Authorities) for approval.
"We must use all the tools we have to limit the impact of the crisis on people and their livelihoods," said László Andor EU Commissioner for Employment, Social Affairs and Inclusion. He added: "I am confident that the EGF will help redundant workers update their skills, supporting them in their efforts to find a new job".
The Spanish application relates to 1 154 redundancies in 593 small and medium sized enterprises operating in the retail sector. The dismissals were a consequence of the global financial and economic crisis. The decline in the volume of retail sales during the recession followed a similar pattern as other economic activities, falling for seven successive quarters from the peak recorded in the first quarter of 2008. However, in Spain the volume of retail sales fell more sharply than the EU27 average.
Rising unemployment – which in Spain is close to 20 %, i.e. double the EU-27 or the Euro zone– and reductions in working hours (no overtime, reduced working week, temporary closures etc), coupled with the scarcity of credit and concerns over possible further contractions in the labour market, explain the downturn in retail sales.
The territory concerned by the redundancies is the autonomous community of Aragón. Most of the territory of the region has a population density between 3 and 54 inhabitants per km2 while the EU average is 112 inhabitants per km2. Due to the low population density and the risk of depopulation, layoffs have a highly negative impact on this region and might jeopardize the efforts made to encourage the population to remain in the territory.
The package of EGF assistance will help the 1 154 former workers of the retail sector by offering them guidance, counselling and job search; training and re-training; intensive job-search assistance; incentives and tutoring after reintegration into work. The total estimated cost of the package is almost € 2.4 million, of which the European Union has been asked to provide EGF assistance of € 1 560 000.
There have been 65 applications to the EGF since the start of its operations in January 2007, for a total amount of about €373.6 million, helping more than 70,000 workers. EGF applications relate to the following sectors: automotive (France, Spain, Portugal, Austria, Germany, Sweden); textiles (Italy, Malta, Lithuania, Portugal, Spain and Belgium); mobile phones (Finland and Germany); domestic appliances (Italy); computers and electronic products (Ireland and Portugal); mechanical/electronic (Denmark and Germany); repair and maintenance of aircraft and spacecraft (Ireland); crystal glass (Ireland); ceramics and natural stone (Spain); construction (Netherlands, Ireland and Lithuania); carpentry and joinery (Spain); electrical equipment (Lithuania) publishing and printing industry (Netherlands), furniture (Lithuania), retail trade (Czech Republic and Spain) and wholesale trade (Netherlands). Final reports from the earlier cases supported by the EGF show strong results in helping workers stay in the labour market and find new jobs.
The EGF, an initiative first proposed by President Barroso to provide help for people who lose their jobs due to the impact of globalisation, was established by the European Parliament and the Council at the end of 2006. In June 2009, the EGF rules were revised to strengthen the role of the EGF as an early intervention instrument. It forms part of Europe's response to the financial and economic crisis. The revised EGF Regulation entered into force on 2 July 2009 and applies to all applications received from 1 May 2009 onwards.
EGF website : http://ec.europa.eu/egf
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