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Member of the European Commission responsible for Education, Culture, Multilingualism and Youth

The Economic Crisis, Education and the Labour Market

Conference at the Economic and Social Committee: "The Economic Crisis, Education and the Labour Market"

Brussels, 24 January 2012

Mr President,

Ladies and gentlemen,

I would like to thank Mr Nilsson for inviting me to address this conference.

I was very happy to accept because your organisation plays a central role in support of our common objectives for sustainable growth and job creation. Just as importantly, we also share a broad consensus on the means to achieve those goals: investing in education and training.

The European Economic and Social Committee has made its position clear – in particular in the Opinion drafted by Mr Soares on the economic crisis, education and the labour market, which lends its name to this conference.

The European Commission for its part has repeatedly underlined the essential role of education and training for Europe's future prosperity. It is the message that comes out clearly from this year's Annual Growth Survey, where the Commission highlights that education and training can make a major contribution to overcoming the crisis and to emerging stronger from it. And it is for this reason that we call on Member States to give priority to growth-enhancing measures, such as education, when consolidating their public finances.

So, my message today is that we have to keep investing in education and training – not in spite of the crisis but because of it.

Sacrificing investment in education and training would be worse than short-sighted. It would not help our productivity or competitiveness in the short term, and it would seriously undermine our future growth prospects and innovation potential.

Indeed, the consequences might be even worse than that. We are all well aware of the disastrous effects of structural youth unemployment and of the risk of ending up with a "lost generation" in many Member States. This is a serious threat to any prospects of sustained economic growth, and an even greater threat to the sustainability of Europe's social model.

Let me remind you that, beginning from this year, the European workforce is estimated to start shrinking in absolute numbers. At the same time, projections tell us that by the year 2020 more than one third of all jobs in the EU will require high-level skills.

But today, one in seven students still drops out of school with no qualifications. These youngsters have few employment prospects; they are making the worst possible start in life. Raising skills is therefore going to be the challenge for the European Union in the coming years.

I believe we all agree on the analysis. Therefore, today, I do not want to discuss so much why we need education and training – we all know why – but rather what needs to be done, now and in the mid-term, to make sure that Europe develops the education and training systems that its people deserve, and that the economy demands.

As you know, the responsibility for education and training lies with national governments – but the Commission is determined to do its part to support the Member States.

Last year we proposed a comprehensive agenda for reform.

We came forward with strategies for tackling early school-leaving and improving early childhood education, as priority areas which will yield major returns on the investment. With Member States we agreed an agenda for adult learning – just in time for the new European Year of Active Ageing. Last September I presented a strategy for reforming higher education. And now we are working on a new strategic initiative on skills.

Let me say just a few words about this forthcoming initiative. The rationale for investing in skills is clear: to equip people with the skills they need to find a good job, or set up a business, and build a successful career. However, in a rapidly changing world, those skills are constantly evolving.

Therefore we must challenge conventional wisdom about the "right" skills – and we must be able to anticipate future skills needs and ensure that our education and training systems are able to respond to new trends. In other words, we need to "re-think skills". I intend to present a Communication on our approach to rethinking skills later this year.

But we are also proposing that the EU should lead by example. And for this we have designed the new education and training programme, 'Erasmus for All', which will start work in 2014. If we have proposed an increase in funding of around 70%, within a global EU budget that is virtually frozen, it is because we wanted to demonstrate the Commission's commitment to education as the main driver of our future prosperity and well-being.

This new, integrated programme represents a real change in gear; a real and welcome change in the Commission's priorities. 'Erasmus for All' builds on the strengths and achievements of its predecessors, but introduces significant novelties.

It is a programme with a simple and coherent structure, which will make it more focussed, efficient and cost-effective. And if we manage to keep operating costs low, then we free up more money for more actions.

Rather than a patchwork of different activities, 'Erasmus for All' proposes a long-term strategy which focuses spending in those areas where European funding has already shown its capacity to add value – supporting learning mobility, partnerships for innovation among stakeholders, and support to key policy agendas.

These include 'Europe 2020' and the Bologna and Copenhagen processes, but also the Modernisation Agenda for Higher Education, the Agenda for Schools of the 21st Century, the European Agenda for Adult Learning and the structured dialogue with young people.

Learning mobility will be at the heart of the programme. We expect by 2020 to be supporting mobility for up to one million learners per year. This will mean more opportunities for students, in higher education and in vocational education, but also for teachers and other staff members. The quality of teachers is a decisive factor for improving the quality of education.

We will expand the opportunities for internships. Internships put students in touch with the world of work and help them to make the transition from education to professional life. And for employers, they are a great opportunity to discover new talent and widen the pool of potential recruits.

Another important change is the Knowledge and Sector Skills Alliances.

Knowledge Alliances will support structured partnerships between higher education institutions and businesses for delivering new curricula and qualifications, and fostering creativity, innovation and entrepreneurship.

Skills Alliances are partnerships between education and training providers and businesses that will promote employability by forming new sector-specific curricula and innovative forms of vocational teaching and training.

As you can see, these new cooperation activities will encourage more education establishments and youth organisations to develop closer links with enterprises. Your support will therefore be very important.

A completely new and innovative initiative is a guarantee facility for student loans. This will allow more Masters degree students to complete their studies abroad. Masters students play a crucial role in improving skills and furthering innovation – they can make a vital contribution to our economy.

Together with the European Investment Bank Group, the Commission will guarantee the loans made by selected financial institutions in the Member States, on terms that are more favourable than those the market would provide. This should produce an important "multiplier" effect, with public money unlocking private funds.

I would now like to say a few words about cooperation with third countries. We live in an open world economy, and Europe needs to strengthen its position as a world player when it comes to higher education.

Today, the EU runs five different programmes for cooperation with third countries. We propose to streamline this work into the new programme, 'Erasmus for All', again with a strong emphasis on mobility.

We will strengthen cooperation with our neighbourhood countries, supporting the capacity building of institutions and the modernisation of higher education, and closely link these activities to student and staff mobility. We will expand the number of high-quality joint degrees and scholarships that we support worldwide, and our funding will reflect the thematic and geographical priorities of the external policy of the EU.

Ladies and gentlemen,

I would like to conclude with our plans that specifically target Europe's youth.

I believe that our youth and education policies, joined together in a genuine strategy, will make a stronger contribution to 'Europe 2020' than they would do standing alone. 'Erasmus for All' will build bridges between non-formal learning and formal education.

Youth exchanges, the European Voluntary Service, training and networking for youth workers, and our structured dialogue with youth organisations will all continue, but with more resources and new ideas.

Through these non-formal learning experiences, young people develop a range of personal, social and professional competences. They improve their chances of finding rewarding work and become more active citizens. 75 per cent of those who participated in the European Voluntary Service said that their career prospects had improved thanks to this experience.

To achieve all these objectives, the cooperation between Member States and with the social partners will be decisive. I look forward to further cooperation with this Committee during the negotiations with Council and Parliament on 'Erasmus for All'.

I believe we share the same goals, and I hope very much that I will be able to count on your support.

Thank you.

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