Local view for "http://purl.org/linkedpolitics/eu/plenary/2011-10-25-Speech-2-485-000"
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"en.20111025.29.2-485-000"2
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"Mr President, the Commission expresses its concern regarding the social and economic consequences that the closure of ArcelorMittal and Nokia will bring. Some 600 direct job losses, as well as indirect job losses at suppliers, are concerned. In the case of Nokia, at least 3 000 jobs may be affected.
Having said all this, of course, what matters is not just what we say in Brussels: at the end of the day, what matters is what the Member States do, what governments do and what firms do. In order to be successful in improving labour markets, we need to build, and to make use of, the right partnerships in Member States, with the social partners and the private sector.
The Commission has proposed a road map for stability and growth to resolve the current crisis. Furthermore, our next Annual Growth Survey will present further proposals focusing on how to promote a growth-enhancing agenda that helps to create and maintain jobs in Europe.
In spite of extremely adverse market and financial situations, companies and their workforces throughout Europe have, by and large, engaged creatively in restructuring processes that were constructive, effective and instrumental in limiting job losses. The Commission wants to encourage permanent business adaptation to swiftly changing economic circumstances while maintaining a high degree of employment and social protection. Measures supporting the reallocation of resources across firms and sectors are strongly needed. They include employment protection legislation and business practices related to corporate restructuring which do not hinder the reallocation of resources, across sectors, towards higher-value-added and faster-growth activities.
In recent years, the EU has put a substantial amount of energy and effort into promoting adaptation to change and restructuring. As announced in the Communication on ‘Industrial Policy’, in the Single Market Act and in the ‘New Skills and Jobs’ Flagship Initiative, the Commission wishes to put adaptation to change and restructuring on the agenda of public authorities, the social partners and other concerned stakeholders by means of a new consultation exercise.
Its objective will be to disseminate and apply the good practice across Europe in the field of anticipation, preparation and socially responsible management of restructuring. The Commission will be using the knowledge and experience acquired over the past few years, including through the Restructuring Forums, studies and seminars. However, we must recognise that this
is still largely unknown to economic and social players. Furthermore, the Commission considers that it needs to be reviewed in the light of the economic crisis.
The EGF currently works with two possible intervention criteria: an application can be made either on trade-related grounds or on the basis of the global financial and economic crisis. This second criterion is time limited and runs out for applications presented after the end of 2011.
As the unemployment situation in the EU is still far from recovering, the Commission has proposed – with the clear support of Parliament but without, so far, having achieved a qualified majority in the Council – an extension of this so-called ‘crisis’ derogation.
The Commission is doing all it can to ensure that the crisis remains an intervention criterion for the EGF after the end of the current year and until the end of 2013, when the new EGF Regulation, proposed as part of the Cohesion Package on 6 October 2011, should enter into effect.
A company’s decision to close down production plants is for the company itself to make. However, the European Union can play a role, and the company needs to follow specific rules. As a very minimum, the Commission expects ArcelorMittal and Nokia to observe strictly the EU directives on information and consultation, collective redundancies and European Works Councils. The Commission also expects ArcelorMittal to comply with the agreements it concluded and the commitments it entered into with employees and local authorities.
The EU can also provide specific support. The European Social Fund offers retraining of workers, including various forms of assistance such as counselling, help towards self-employment, and so on. If it is not possible to keep the jobs, and the workers are made redundant, Belgium or Romania, in this case, could apply for support from the European Globalisation Adjustment Fund (EGF) if the Fund’s criteria are met. First contacts between the Belgian and Romanian authorities and the EGF services of the Commission have already been made.
More generally, I would like to highlight the main challenges that we face. First, it is becoming increasingly clear that growth is at risk in the EU. Indeed, recent projections showed that growth in many countries across the globe – especially in developed countries – is strongly decelerating. The EU economy is no exception to this trend. The sovereign debt crisis is making things even worse for several euro area countries by pushing up interest rates and further affecting confidence.
Second, employment is a major concern. In the second quarter of 2011, employment growth measured over four quarters was a meagre 0.3%, and in August, the EU unemployment rate was still stuck at 9.5%, the same level as at the start of the year. In contrast to our assessment in the spring, when the prospect was one of job-loss recovery, we now have to fear an employment crisis in the EU with a number of negative features: high youth unemployment, which is twice as high as the average unemployment rates; high structural unemployment with high budgetary and human costs; long-term unemployment, which has already risen from its earlier level of under three per cent of the active population pre-crisis to just over four per cent in the middle of this year; and rising levels of precariousness. The recent recovery in employment stems mainly from an increase in temporary jobs, as the number of workers on a permanent contract has risen only moderately over the past four quarters.
Finally, there is increasing social unrest as a result of the deterioration in employment, the implementation of severe austerity measures and wage cuts in the context of persisting inequality. Indeed, there is an increasing perception among Europeans that the cost of the crisis is not equally shared, with the poor suffering the most – and, as we have seen, this is a potentially explosive situation.
In the short term, it is important that EU policy makers provide a clear, coherent and comprehensive response in order to calm financial markets and bring back confidence. This plan should address structural flaws in the Economic and Monetary Union and concerns about Greece and other countries, but should also revive the growth potential of the individual Member States.
The state of our public finances is very weak and we face lower growth expectations in the near future. This means that labour market recovery cannot rely on public stimulus measures and it cannot rely on GDP growth pulling the huge numbers of jobseekers back into the labour market. What we need to do is improve the functioning of Europe’s labour markets. Existing labour supply and labour demand will need to come together sooner; job matching should be more efficient; and existing jobs will need to last longer and be more productive.
With precisely this in mind, the Commission issued country-specific recommendations just before the summer break. These recommendations provide specific guidance on labour market functioning, tailored to each Member State’s situation and covering a wide range of labour market reforms including payroll taxes, child care, education systems, wage-setting mechanisms and retirement patterns."@en1
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