Friday, April 27, 2012


ETUC protesters, Brussels February 2010

How should the economic crisis in Europe be addressed? The classical or conservative road is taken by German prime  minister Merkel.  She insists on a rigorous governmental financial policy with a strict budget control. The budget should not have a deficit bigger than 3%. Government debt should be limited to 60% of the GNP. These strict rules are signed by all EU Governments and laid down in EU legislation. Until now this policy has been fully supported by the Frech president Sakozy and countries like the Netherlands, Finland and Austria. Ireland, Portugal, Spain and Italy are working on it.

But there are also many opponents of this policy, mainly trade unions and leftist political parties. They believe that such a strict budget control destroys the economy resulting in massive unemployment and poverty. The European Trade Union Confederation repeatedly has stressed this point of view. The French socialist and presidential candidate Hollande supports this position of ETUC (the second round between the actual president Sarkozy and Hollande will be on May 6). If Hollande will be elected tensions on future European policy will increase again.

In the meantime the European Commission responded to this criticism  with the publication of a report called “Towards a job-rich recovery”. The report says that “Job creation is one of the EU’s most pressing concerns as it struggles to emerge from the economic crisis. Unemployment has risen to record highs – about 24.5 million people are unemployed, over 10% of the workforce.”

ETUC protesters, Brussels February 2012
The recommendations aim to provide jobseekers with more training and more job opportunities. Those in work would get help acquiring the skills they need to stay up-to-date with changing job requirements. Employers creating new jobs would also receive support. General recommendations include:
-   1. Encouraging job creation through support for businesses, entrepreneurs and self-employed persons, including decent and sustainable wages.
-   2. Targeting key industries where jobs are being generated: the green economy, health and social care sector, digital economy, etc.
-   3. Using existing EU programmes to fund job creation.
-   4. Reforming labour markets to meet future demand
-   5. Developing programmes to encourage lifelong learning and providing young people with training to advance their careers.
-   6. Investing in skills training, anticipating future job requirements removing obstacles to finding a job in another EU country.
-   7. Fine-tuning schemes – including the EURES jobs database – that match jobseekers with jobs across Europe.
-   8. Improving coordination of employment policies across Europe.
-   9. Increasing the involvement of employers' and workers' groups in employment policy making.

However, the ETUC stays very sceptical on these proposals as we can read in the press release of April 18The Commission’s proposals will do nothing to help create quality jobs, if the European Union and its member states continue to implement rigid fiscal austerity rules. On the contrary, cutting deficits in the midst of a recession will produce a deeper recession and even higher unemployment rates. Labour market policies cannot compensate for failing macro-economic policies. “

The ETUC believes even less in the proposals for labor market reforms like for example “flexicurity” : “Whilst the model has worked in some Nordic countries, in other parts of Europe it has resulted in increased insecurity for workers.” The ETUC asks for more positive proposals: “strengthening the involvement of social partners in the elaboration of macroeconomic and labour market policy, the role of decent wages in securing job quality and domestic demand, increasing minimum wages to help prevent growing in-work poverty, action to support youth employment and to tackle undeclared work. To replace the ‘governance of austerity’ with the ‘governance of growth and good jobs’, the ETUC urges all European policy makers to advance on these proposals.”

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