Brussels, 16 July 2012
Employment: Commission proposes €4.3 million from Globalisation Fund to help former AstraZeneca workers in Sweden
Brussels, 16 July 2012 - The European Commission has today proposed to provide Sweden with €4.3 million from the European Globalisation Adjustment Fund (EGF) to help 700 workers made redundant by the pharmaceutical firm AstraZeneca back to employment. The proposal now goes to the European Parliament and the EU's Council of Ministers for their approval.
EU Commissioner for Employment, Social Affairs and Inclusion László Andor said: "The pharmaceutical industry is currently undergoing significant changes in order to retain its competitiveness in a tough environment, and it is therefore increasingly seeking synergies to hold down the rising costs of R&D activities. I am confident that this proposal for 4.3 million euros from Europe's Globalisation Fund would help to make the workers' transition to new jobs easier and faster."
Sweden applied for support from the EGF concerning 987 redundancies from AstraZeneca following the closures of the R&D sites in the municipalities of Lund and Umeå and limiting operations in Mölndal and Södertälje. Of the total 987 redundant workers, 700 with the most difficulties to get new jobs are targeted for support from the EGF. The package aims to help the workers by offering them occupational guidance and job-search assistance, as well as vocational training and retraining, and aid for self-employment.
The total estimated cost of the package is approximately €6.6 million, to which the EGF would provide €4.3 million.
As the pharmaceutical industry is increasingly seeking synergies to hold down the rising costs of R&D activities and retain its competitiveness, many companies are in a state of transition which results in reorganisations, consolidations, mergers and acquisitions. Global investments and biotechnological research are on the increase and new competitors are increasing in strength in China, Brazil and India.
Many non-European countries are designing strategies for biosciences and industry in areas of pharmaceuticals, biotechnology and medical technology. AstraZeneca, which had three R&D centres in Sweden, followed the trend and adopted a new R&D strategy in 2010. This included the necessity to focus on fewer disease areas, closures of sites (including those in Lund and Umeå) and significantly greater utilisation of external resources through outsourcing.
The majority of the workers were made redundant in Lund in southern Sweden, but the redundancies also affect Umeå in northern Sweden, Södertälje in the metropolitan area and to a lesser extent Mölndal in western Sweden. Unemployment increased in all affected municipalities from January 2009 to November 2011.
There have been 101 applications to the EGF since the start of its operations in 2007. Some €435.3 million has been requested to help about 90,481 workers. EGF applications are being presented to help a growing number of sectors, and by an increasing number of Member States.
More open trade with the rest of the world leads to overall benefits for growth and employment, but it can also cost some jobs, particularly in vulnerable sectors and affecting lower-skilled workers. This is why Commission President Barroso first proposed setting up a fund to help those adjusting to the consequences of globalisation. The EGF was established at the end of 2006 and was designed to demonstrate solidarity from the many who benefit from openness to the few who face the sudden shock of losing their jobs. In June 2009, the EGF rules were revised to strengthen the role of the EGF as an early intervention instrument forming part of Europe's response to the financial and economic crisis. The revised EGF Regulation entered into force on 2 July 2009 and applied to all applications received from 1 May 2009 to 30 December 2011.
Building on the experience acquired with the EGF since 2007 and its value added for the assisted workers and affected regions, the Commission has proposed to maintain the Fund also during the 2014-2020 multiannual financial framework, while further improving its functioning.
László Andor's website: http://ec.europa.eu/commission_2010-2014/andor/
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