Brussels, March 2002
European Union countries could achieve a dramatic increase in employment rates within just three years if they coordinate their policies more closely and implement a number of social and economic reforms, according to a new research report.
These reforms could stimulate the creation of four million jobs in Europe by 2005 - and the number could rise to 11 million by 2010, the report by a Danish think tank claims. This would correspond to an increase in the rate of employment by approximately four percentage points.
A mixture of pro-market and social-friendly policies are put forward by the researchers as the means to achieve this ambitious goal. On the one hand, there should be more flexible labour markets and a strengthened business policy focused on increased competition and innovation, liberalisation and easier access to capital.
On the other hand, the report recommends an increase in spending on education from the current EU average of 4.8 per cent to 5.5 percent of GDP. Although an increase in the student population would create a short-term labour shortage, the researchers argue that there would be a long-term gain as a better educated population leads to better quality jobs for more people.
The report also recommends an increase in the participation of women and older people in the workforce. Better public services for childcare and care of the elderly - with a 1.5 million increase in the number of carers by 2010 - would allow more women to take up jobs.
According to the researchers, however, a decisive increase in the EU employment rate is only possible if all Member States agree on coordinated implementation of the reform package throughout Europe. The report states: 'If only a minority of Member States implement the package, the effect in the individual countries will be correspondingly lower. The reason for this is that Europe is an economic entity. Investments in employment in one European country will therefore also have a positive influence on employment in other European countries'.
The research was carried out by Denmark's Economic council of the labour movement, a think-tank with links to the Danish Socialist Party, trade unions and cooperatives. Socialist party leader and former Danish Prime Minister, Poul Rasmussen, commissioned the report to help clarify the ongoing Lisbon process of social and economic reform.
For further information on the report, entitled 'Co-operation pays', please consult the following web address: http://www.pes.org/upload/Publications/ 49ENRasmussen.pdf