European Focus on Labour Market

The EU labour market in 2011 was marked by a sudden interruption of the timid recovery in employment. Employment started falling in the mid of 2011 amid a reduction of job finding rates and a new process of job shedding concerning most of the EU, with job separations surging in a few countries, notably Greece and Portugal. The current weakening of the labour market is mostly the result of worsening economic activity linked to the aggravation of the sovereign crisis. About 40% of the growth in unemployment for the overall EU since 2008 is due to the massive increase in Spanish unemployment. After four years with the beginning of the financial crisis, finding job rates remain low in most member counties. Youth unemployment rates increased dramatically in Greece, Portugal, Spain. Since the start of the crisis, most EU countries have taken an active reform stance, and managed in some cases to pass ambitious reform plans. Some countries have high unemployment and large external imbalances for this reason they try to improve their responsibility and labour market adjustment by reforming their job protection. Unemployment is becoming a very serious issue in a number of EU countries, with increasingly visible economic, social and political implications. The rate of the unemployment should be decreased that’s why the countries should create new conditions for the build up trust and to keep it labour demand on the stable basis. In several countries, these reforms usually politically were recently carried out within the framework of structural adjustment programmes. For examples Greece, Spain, Italy, and Portugal, took measures. Also in this countries by taking new tax reforms, could create the conditions for better mobilising labour supply and demand. In the countries should concerned by high youth unemployment policies and also focus on easing the school-work transition, including by an effective use of apprenticeship systems.On the basis of increasing poverty and social exclusion, increasing unemployment and reduced income lies.After the increase of the sovereign debt crisis in the euro area, investments and consumption decisions have influenced. Unemployment in the EU as a whole grew, in contrast with other world regions.The unemployment rate in the euro area is currently at the highest level and unemployment performance at unprecedented levels. The number of unemployed in April 2012 was 17.4 million for the euro area, almost 25 million in the EU. The number of job losses since 2008 amounts to about 5 million for the EU; 3 million for the euro area.


In 2011, the euro area was the world region with the highest unemployment rate. Since second half of 2011, unemployment developments in industrialised countries have started to diverge, mainly as a consequence of a more sustained recovery in the US and Canada compared with the EU and Japan.In Japan, GDP growth turned out negative following weak external demand and the supply chain disruptions related with the earthquake and flooding in Thailand. Conversely, in many other industrialised countries, most notably Canada, Australia, and New Zealand, unemployment remains above the pre-crisis average in spite of the recovery.In the United States, relatively stable real wages were associated with sluggish job creation amid strong recovery of productivity growth. In Japan, the limited adjustment in head-count employment during the 2011 contraction coincided with a substantial increase in real wages, mostly attributable to price deflation

The European employment strategy seeks to create more and better jobs throughout the EU. It takes its inspiration from the Europe 2020 growth strategy. In response to the high level of unemployment in Europe, the European Commission launched in April 2012 a set of measures to boost jobs, the so called “Employment package”.

  1. 1. Support job creation
  2. 2. Restore the dynamics of labour markets
  3. 3. Strengthen the governance of employment policies

Flexicurity is an integrated strategy for enhancing, at the same time, flexibility and security in the labour market.

Working with national governments, social partners and academics the EU has found acommon flexicurity principles and has explored how countries can implement them through four components:Flexible and reliable contractual arrangements,Comprehensive lifelong learning strategies,Effective active labour market policies,Modern social security systems

Integrated flexicurity policies play a key role in modernising labour markets and contributing to the achievement of the 75% employment rate target set by the Europe 2020 Strategy.



Written by Latife Cansu Bayar, Eyüp Dönderalp, Lucija Kacin and Lenka Filova



3 thoughts on “European Focus on Labour Market

  1. The European Labour Market has brought big benefits to the men and women of Europe. However, in a time of economic crisis (or rather fundamental change), EU must focus on both protecting workers rights and improving competition. These two developments create a strategic opportunity to link trade liberalisation with labour standards and hence to both reap gains and avoid harm.

  2. The European Labour Market should give people the right incentives to invest in training, upgrading their skills in line with labour market needs. Also, ensure the right labour market conditions in job creation such as less administrative burdens or lowering the taxes on labour and mobility. It is important for workers, both men and women to have decent working conditions.Better quality of employment legislation will definitly change bad job finding rates.

  3. In a labour market comprising some 220 million people in employment, these statistics may
    not seem unduly negative but it needs to be seen in context. Between 1998 and 2007, the EU labour markets intended to add, on average, around two million new jobs every year. As well as lost growth, the crisis may have cost as many as 15 million jobs in the EU so far, and the macroeconomic situation is not favourable towards job creation. All this said, the European labour market is large and diverse, and there are distinct categories of employment that are growing.


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s