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Mr. László ANDOR
EU Commissioner responsible for Employment, Social Affairs and Inclusion
"Getting people into jobs"
Brussels, 30 May 2012
There are more country specific recommendations on employment, education and exclusion this year than last year.
The objective of these recommendations is to ensure that Europe makes the most of its human capital. Europe's people, with their skills and creative capacities, are our greatest asset, but also our most under-used asset.
We have to get as many people as possible into jobs and make their work as productive as possible.
As we underlined in the April Employment Package, employment is a driver of growth, not a by-product of growth.
Smart fiscal consolidation, financial reform and combating tax avoidance are all important elements in Europe's efforts to get out of the crisis. But we will not get growth and stability without bringing more people into more productive work.
There are six main areas where we have made recommendations to Member States.
Firstly, Member States must pursue efforts to improve the functioning of their labour markets. In particular, some Member States must make it easier to recruit young people, older people and women by adjusting their legislation on employment protection. In the same vein, some Member States should further review wage indexation and wage-setting systems to allow alignment with productivity developments so as not to hamper emerging economic activity. On the other hand, where productivity increases, wages should increase. This is the case of Germany for example. The economy will not pick up unless people are able to buy goods and services from one another. In this context it is also important to pay attention to in-work poverty and low-wage traps. Minimum wages can be a useful instrument in this context, as we said in the Employment Package.
Secondly, Member States have to take measures to bring down unacceptably high levels of youth unemployment and to facilitate the transition from school to work. Examples include special incentives for companies to hire young people, increasing the availability of apprenticeships and work-based learning and reducing drop-out rates. For example, such reforms are crucial in Spain and Portugal.
Thirdly, Member States must reinforce their efforts to increase job creation and work incentives through continued measures to shift the tax burden away from labour, especially for low and medium-income earnersand on to the environment. Some Member States also have to make their public employment services more efficient and effective and to improve access to training and life-long learning. This is the case, for example, for a number of countries in Central Europe.
Fourthly, many Member States must do more to extend working lives. They need to reform pension systems so that pensionable age is linked to life expectancy and early retirement rates are reduced. But that's not enough. Member States must also make it easier to employ older workers, by investing in lifelong learning, and adapting workplaces and the organisation of work.
Fifthly, Member States must do more to foster women's participation in the labour market. This is crucial for boosting growth as well as to for meeting the challenges of the ageing population. Examples of measures include provision of full time care facilities for dependents, reducing tax disincentives for second earners and ensuring flexible working arrangements.
Finally, it is vital to protect the vulnerable against the damage resulting from the continued economic crisis - otherwise we are putting social cohesion at risk for years to come. Member States need to act to improve the adequacy and coverage of social protection systems, ensure access to quality social services and better target social assistance.
The ball is now in the Member States' court. I sincerely hope that they will recognise the value of these recommendations and act upon them urgently