Commission européenne The European Employment Strategy within the new Lisbon agenda Boosting Growth and Jobs in Europe Safeguarding the European social model Guido Vanderseypen Employment Strategy Unit, DG Employment, Social Affairs & Equal Opportunities, European Commission CICERO FOUNDATION – PARIS – 24 FEBRUARY 2006

Commission européenne European social model under debate EU provides a platform of fundamental rights and common values Key features of European Social Model(s) : solidarity principle => high public expenditure national diversity => legislation, social dialogue, OMC Financial sustainability threatened by demographic trends, global competitive pressure => need for stronger financial basis (growth and jobs) Need for labour market reforms

Commission européenne The need for reform increasingly recognised Unemployment at a socially unacceptable level EU lagging behind in terms of GDP per capita, employment and productivity Industrial restructuring gathering pace Low innovation record and job creation Workforce will decline (~ 2015)

Commission européenne EU performance (US=100)

Commission européenne R&D expenditure as % of GDP (US:2.8%; target : 3%)

Commission européenne The case for EU policy coordination Single market / EMU synergy between growth and employment (GSP) EU financing (ESF bln) However : Treaty limitations (limited regulatory power) Subsidiarity and diversity of social systems => Europe is only part of the solution

Commission européenne Lisbon Agenda Lisbon objective (2000) : to become the most competitive and dynamic knowledge-based conomy in the world capable of sustainable economic growth with more and better jobs and greater social cohesion => Several new OMCs since 2000

Commission européenne The European Employment Strategy (EES) has coordinated Member States' employment policies since 1997 through: common European guidelines and recommendations annual national action plans for employment monitoring, evaluation at EU level mutual learning / peer review The European Employment Strategy A policy coordination ramework which complements EU action in the field of employment (cf. legislation, social dialogue and the European Social Fund) see

Commission européenne Overview of employment performances ( ) Lower structural rates of unemployment, long-term unemployment and spells of unemployment Growth in employment creation (+6 million jobs ) and employment rates (esp. women) increased «resilience» of employment (even after 2001) Clear shifts in taxation on labour, gender equality New paradigms (quality in work, lifelong learning, segmentation)

Commission européenne Over-arching objectives of the EES since 2003 increasing employment rates by 2010 overall employment rate : 70% female employment rate : 60% employment rate 55+ : 50% increasing productivity and quality of jobs social inclusion and territorial cohesion

Commission européenne Does the EES work ? ( recent evidence > 2002 ) Continued improvement in female employment Decline in employment of 55+ curbed Proved effectiveness of ALMPs under conditions Reversal of unemployment and inactivity traps Visible improvement in LLL performance Widening of productivity gap halted

Commission européenne Employment rates EU

Commission européenne Weaknesses of original Lisbon Strategy (LISBON I) ca. 10 parallel OMC's with parallel reporting ("burocracy") Too many priorities and targets, sometimes conflicting or overlapping Lack of national ownership (EU level targets) and communication about the benefits of reforms Need to establish a new partnership with MS based on a simpler reporting system and greater ownership

Commission européenne The renewed Lisbon Strategy (LISBON II) aimed at better implementation (national and EU partnership) focus on growth and jobs => integration of Treaty based processes (BEPGs and EGs) 3 year stability single reporting (National Reform Programmes) reviewed annually Community Lisbon Programme (20 July 2005), setting out action at EU level (Financial Framework 2007-'013, Innovation Action Plan, better regulation – e.g. state aid -, Services directive)

Commission européenne Broad Economic Policy Guidelines (2005-'08) 16 Guidelines covering inter alia sound public finances (Growth Stab. Pact) sustainable pension and public health services public finances reoriented to employment wages in line with macro economic stability increase R&D investment to 3% of GDP facilitate innovation, and use of ICT reduced administrative burden promotion of entrepreneurship European infrastructure (Internal Market)

Commission européenne The new Employment Guidelines ( ) (17) To implement employment policies aimed at achieving full employment, improving quality and productivity at work, and strengthening social and territorial cohesion ATTRACT AND RETAIN MORE PEOPLE IN EMPLOYMENT, INCREASE LABOUR SUPPLY AND MODERNISE SOCIAL PROTECTION SYSTEMS (18) To promote a lifecycle approach to work (19) To ensure inclusive labour markets for job-seekers and disadvantaged people (20)To improve matching of labour market needs IMPROVE ADAPTABILITY OF WORKERS AND ENTERPRISES (21) To promote flexibility combined with employment security and reduce labour market segmentation (22) To ensure employment-friendly wage and other labour cost developments INCREASE INVESTMENT IN HUMAN CAPITAL THROUGH BETTER EDUCATION AND SKILLS (23) To expand and improve investment in human capital (24) To adapt education and training systems in response to new competence requirements

Commission européenne The EES and Lisbon II The Lisbon Strategy initiated a comprehensive set of structural reforms. The EES is the employment pillar. Macro-economic policy coordination stability and growth pact, monetary policy Micro-economic reforms industrial policy, innovation and R&D, reforms in product, service and financial markets Employment policy coordination attracting more people, adaptability of workers and enterprises, investment in human capital Sustainable Development Strategy Coordination on social protection & social inclusion Lisbon EES

Commission européenne Lisbon Strategy governance National Reform Programmes (NRP) – first presented in Autumn 2005 Annual Progress Report to Spring European Council (23 March 2006) ongoing Open Methods of Coordination feeding in (social protection, education) European Structural Funds programming (2006) NRP updates in Autumn 2006

Commission européenne Results of the first Lisbon "round" Member States have drawn up NRPs with clear priorities and synergies Focus on employment participation and LLL Weaknesses: lack of interest for adaptability Mixed : partnership and budget provision Significant progress on the Community Lisbon programme (financial perspectives, services directive, REACH)

Commission européenne increased investment in higher education (from 1.28% of GDP to 2% in 2010) all MS to set up "one-stop shops" to assist entrepreneurs and efforts to cut red tape by 2007 new energy initiative delivering jobs in the face of globalisation and ageing Follow up actions (1) – « Hampton Court »

Commission européenne every young person to be offered a job, apprenticeship or training within 100 days by 2010 greater effort to meet childcare targets concentrate on training for people over 45 a new agenda on flexicurity (extraordinary social summit) Follow up actions (2) – delivering jobs…