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Employment - Social affairs - Health

1. Background


  • Maintaining competitiveness in the global economy
  • Employment, social initiatives and health as extensions of the Lisbon Strategy
  • Restructuring of the labour market

The European Union has the largest economy in the world. The EU’s focus on economic growth throughout the 1980s and 1990s gave way in the new millennium to a wider set of goals aimed at providing sustainable growth, social equality, and improved health and welfare to its citizens. Through policy-making and initiatives, the EU seeks the right balance between remaining competitive in the global economy and respecting the need for decent working and living conditions for its citizens. However, each member state has its own, internal policies for employment and social affairs, thus the principle of ‘subsidiarity’, as enshrined in the Maastricht Treaty, ties the European Union’s hands on certain issues of importance to member states. In principle, social affairs and health policy are the responsibility of the member states at a national level.

As such, the EU plays more of a coordinating role to help its member states achieve common goals, including equality, improvements in working conditions, occupational health and safety issues and the creation of networks to encourage employment mobility. While certain high-profile food health scares gave added impetus to joint action in recent years, the Union’s role is still limited to co-ordination, communication and support for research. The EU’s achievements include the expansion of the European Medicines Agency (EMEA) to include new member states and candidate countries, as well as extensive efforts to promote better communication between scientists, the media and the public.

Most current initiatives in employment, social affairs and health are extensions of the revised Lisbon Strategy for economic, social and environmental rejuvenation. The Lisbon Strategy set out to make the EU “the most dynamic and competitive knowledge-based economy in world capable of sustainable economic growth with more and better jobs and greater social cohesion, and respect for the environment by 2010.”

In 2004, former Dutch Prime Minister, Wim Kok, was mandated by the Commission to head a committee to review the Lisbon Strategy. The Committee found that little progress had been made towards the Lisbon Strategy goals, and that the Union was experiencing economic stagnation. It was recommended that greater focus be placed on economic growth and employment.

The Commission’s Partnership for Growth and Jobs strategy initiative addressed the problems listed in the Kok report. As to employment, the target for 2010 is an overall employment rate of 70%. Key areas include boosting innovation, more and better jobs, adaptable workforce, better education and skills, investing in R&D, improving European infrastructure, effective Internal Market and better regulation.

The Commission's Joint Employment Report of February 2007 stated that unemployment fell from 9.1% in 2004 to 8.8% in 2005 and employment rose by 0.8% in 2005. The report also said that 22 million jobs had to be created to reach the 2010 goals. Accompanying the Employment Report was the Joint Report on Social Protection and Social Inclusion, which stressed the “need for progress in the areas of child poverty, active inclusion, the modernisation of pension provision and access to healthcare.” The Social Report stated that, in 2004, 16% of EU citizens lived at the poverty level, defined as 60% or less of average national income.

The new impetus given to Growth and Jobs shows signs of working: in 2006, employment in the European Union grew by 1.4%.

Restructuring of the Labour Market is the consequence of global competition and the shift of certain working sectors, technology that changes the face of the job market and many other factors. In order to weather these changes, the EU must restructure the labour market in order to promote enterprise and competition. The various policies that affect restructuring are organized under a Restructuring Task Force and the launch of a Restructuring Forum. The policies include:

  • Legislation to ensure integration with the global economy, including corporate restructuring and the implementation of social dialogue, and an Industrial and Enterprise Policy to affect economic and technological development and anticipate change
  • An effective Employment Policy to improve the labour market and increase worker adaptability and the investment in human capital
  • EU Funding
  • Competition Policy, including control of state aid and Merger Regulation
  • External Policy between the EU and its partners and with international organisations

The two cornerstones of EU’s employment and social policies are the European Employment Strategy on job creation and labour market reform strategies and a Social Agenda designed to ensure that the benefits of the EU’s growth benefit everyone in society and every region in the European Union.

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