A4-0287/95

Resolution on the Commission's annual report, 'Employment in Europe - 1995' (COM(95)0396 - C4-0384/95)

The European Parliament,

- having regard to the Treaty establishing the European Community, particularly Articles 2, 3, 3a, 103 and 118 thereof,

- having regard to the Commission White Paper on Growth, Competitiveness and Employment (COM(93)0700 - C3-0509/93),

- having regard to the Commission White Paper on a European Social Policy - A way forward for the Union (COM(94)0333 - C4-0087/94), and the Commission's social action programme,

- having regard to the decisions of the European Council at its meetings at Edinburgh, Copenhagen, Brussels, Corfu, Essen and Cannes,

- having regard to the communication from the Commission to the Council on the Follow-up to the Essen European Council on Employment (COM(95)0074 - C4- 0114/95),

- having regard to the recommendation from the Commission on the Broad Guidelines of the Economic Policies of the Member States (COM(95)0228 - C4- 0210/95),

- having regard to Council recommendation 95/326/EC on the Broad Guidelines of the Economic Policies of the Member States and the Community ((OJ L 191, 12.8.1995, p. 24.)),

- having regard to the Communication from the Commission and proposal for a Council decision on the Commission's activities of analysis, research, cooperation and action in the field of employment (Essen) (COM(95)0250 - C4-0385/95) ((OJ C 235, 9.9.1995, p. 8.)),

- having regard to the joint opinion drawn up by the Macroeconomic Group of the Social Dialogue on 'The Social Partners' Guidelines for Turning Recovery into a Sustainable and Job-Creating Growth Process' of 16 May 1995, signed by the European Trade Unions Confederation (ETUC), the Union of Industrial and Employers' Confederation of Europe (UNICE) and the Centre of Enterprises with Public Participation (ECPE),

- having regard to its resolutions of 9 March 1994 on the Commission White Paper on Growth, Competitiveness and Employment ((OJ C 91, 28.3.1994, p. 124.)), of 10 March 1994 on the social policy implications of the EMU process ((OJ C 91, 28.3.1994, p. 206.)), of 19 January 1995 on the White Paper on European Social Policy ((OJ C 43, 20.2.1995, p. 63.)), of 2 March 1995 on the European Union's priorities for the World Summit for Social Development ((OJ C 68, 20.3.1995, p. 49.)), of 7 April 1995 on the Annual Economic Report for 1995 ((OJ C 106, 2.5.1995, p. 273.)), of 13 July 1995 on a coherent employment strategy for the European Union ((OJ C 249, 25.9.1995, p. 143.)), of 14 July 1995 on the Commission's recommendation for the Broad Guidelines of the Economic Policies of the Member States ((OJ C 249, 25.9.1995, p. 213.)) and the Commission's Annual Report on Employment in Europe - 1994 ((OJ C 249, 25.9.1995, p. 208.)),

- having regard to the communication from the Commission on a European Strategy for Encouraging Local Development and Employment Initiatives (COM(95)0273 - C4-0289/95),

- having regard to the annual report from the Commission on Employment in Europe - 1995 (COM(95)0396 - C4-0384/95),

- having regard to the 'interim report of the chairman of the Reflection Group on the 1996 IGC', particularly its conclusions regarding employment,

- having regard to the Commission Communication entitled 'European Employment Strategy: Recent Progress and Prospects for the Future' (COM(95)0465 - C4- 0461/95),

- having regard to the report of the Committee on Social Affairs and Employment and the opinion of the Committee on Economic and Monetary Affairs and Industrial Policy (A4-0287/95),

A. whereas economic and social development constitute the hallmark of the European Union, which has committed itself to economic and social cohesion,

B. whereas the goal of creating 15 million jobs by the turn of the century, set forth in the White Paper on Growth, Competitiveness and Employment, will not be achieved by the expected increase in the rate of economic growth alone, although it will still be necessary to maintain a sustained rate of economic growth,

C. whereas the Union faces a critical challenge relating to its ability to curb unemployment, 18 million people being officially registered as unemployed; whereas this represents, furthermore, an important factor in exclusion,

D. whereas the globalization of the world economy, caused by the liberalization of trade, capital movements and financial services and accompanied by deregulation of markets, places enormous pressure on all Member States which cannot be addressed in isolation; hence the need for the adoption of a common strategy to promote sustainable growth, employment and a high level of social protection combining the most effective measures at the appropriate level,

E. whereas such a common strategy requires proper policy actions together with coordination, cooperation and monitoring procedures at EU level, which need to include acceptable economic and social indicators to secure a balanced distribution of the benefits of economic growth among productivity, capital gains, wages and job creation, in order to achieve a high level of economic and social cohesion,

F. whereas an efficient employment strategy for the European Union presupposes a combination of macro-economic and structural labour market policies, which should mutually reinforce each other, both at national level and at Union level; whereas the development of such a common employment strategy requires intensive interinstitutional cooperation amongst the European Commission, the European Parliament, the Social Affairs Council, the Ecofin Council and social partners, requires employment to be placed at the centre of labour and economic policy and calls for active cooperation between the EU Member States and institutions,

G. supporting the Report's 're-employment strategy', which is supposed to give content to the five key areas of policy agreed on at the Essen European Council, but noting that the Report offers no specific guidelines except tentative suggestions,

H. whereas the 1996 IGC provides an opportunity to reconcile the Union's economic, social and environmental goals with the commitment to price stability and sound public finance laid down in the provisions concerning Economic and Monetary Union, by inserting full employment as an explicit objective of the European Union,

I. Employment situation in the EU

1. Is concerned at the fact that, according to the annual report on employment in Europe 1995, the following changes occurred between 1991 and 1994:

a. 6 million jobs were lost, with the result that 18 million people, or nearly 11% of the work force, are now unemployed;

b. the level of employment fell below 60%;

c. long-term unemployment currently accounts for 48% of unemployment, and half of the unemployed have been unemployed for more than two years;

2. Stresses the economic importance and social impact of the reserve of manpower, which is estimated by the Commission to comprise 18 million unemployed, 9 million newcomers and 4 million part-time workers who wish to have full-time jobs;

3. Welcomes the prospects held out in the Commission report, which states that:

a. full implementation of the macro-economic section of the economic guidelines could result in investment-led growth of 3 to 3.5% in the period 1995-2000, which could reduce unemployment to 7.5% by the year 2000;

b. consistent implementation of the structural labour-market measures agreed at Essen could reduce unemployment by a further 2.5%, so that the White Paper's objective of halving unemployment by the year 2000 remains within reach;

4. Stresses that this scenario will not be fulfilled automatically but requires simultaneous and coordinated mobilization of macro-economic policy and structural labour market policy to promote employment;

5. Is also concerned at the sensitivity of the estimates by the Commission concerning the correlation between growth and unemployment rates; the Overview Report states that 'an annual GDP growth rate which is only a quarter of a point lower than that projected over the period 1996-2000 would put the unemployment rate in 2000 at 9 per cent instead of 7.5 per cent in the optimum scenario';

6. Notes, however, that if no budgetary consolidation is achieved coupled with uncoordinated policies, implying a strict monetary policy, the Commission's scenario suggests that GDP growth would remain stuck in the 2 to 2.5%, resulting in a temporary fall in unemployment to about 9.75% in 1997 but then rising to 11% in 2000;

II. Employment policy in the Union

7. Observes that the Member States have adopted measures with regard to the five priorities established at Essen; regrets the delay on the part of some Member States in drawing up multiannual plans and the very slow and fragmentary manner in which labour market policy is being revised; calls on the Council, therefore, to intensify and accelerate its efforts;

8. Notes that determined measures to combat unemployment are fundamental to reducing ancillary wage costs and that every new job helps to combat both unemployment and the risk of poverty and, in addition, reduces demographic- related burdens on social security systems; notes also the potential for creating additional jobs by reducing non-wage labour costs can be increased by targeting reductions in labour costs selectively at the relatively unskilled and that the social insurance costs and therefore ancillary wage costs can be reduced by shifting non-social insurance benefits to other sources of financing; advocates in this context that the reduction of labour costs be clearly linked to demonstrable net job creation measures in cooperation with the social partners;

9. Calls on the Commission to study carefully the experiences of Member States in reducing labour costs by shifting charges and contributions to other revenue sources and to propose at Union level possible alternative sources of revenue, such as the proposed tax on CO2 emissions and an energy tax;

10. Stresses the importance of informing, consulting and involving workers where decision-making is concerned, particularly in the case of transition to more flexible production methods; considers that such involvement by employees at local, regional, national and Community level should be an integral part of the new social and economic development models to be drawn up in order to develop sustainability and increase the competitiveness of the Union economy; stresses in this connection the importance, from the point of view of method and substance, of the document of 16 May 1995 drawn up by the social interlocutors on the guidelines for transforming recovery into a process for ensuring long-term growth and job creation;

11. Calls on the Member States to use their labour market expenditure and instruments more actively to help job-seekers find employment, without however calling into question social protection; reiterates the importance attached to quantitative and qualitative improvement of investment in training and education and to life-long learning, especially for low-skilled and for SME-workers as a means for achieving a better equilibrium between supply and demand and improving the employment prospects of high-risk groups; stresses that converting unemployment benefits into job subsidies or permitting these benefits to be drawn during training or when a job is found for the claimant, can help members of high-risk groups to re-enter employment; emphasizes that an active labour market policy implemented by a variety of bodies, including public employment agencies, must be supported using all available resources and tailored primarily to preventing long-term unemployment; calls on Member States, the EU and the social partners to improve and increase their efforts in this field;

12. Welcomes the fact that, in its Communication on a European Strategy for Encouraging Local Development and Employment Initiatives, the Commission has identified 17 fields in which up to 400 000 jobs per annum could be created, particularly for high-risk groups in the labour market; welcomes the view put forward by the European Council in Cannes stressing the great importance it attaches to the development of local employment initiatives and pointing to the need to ensure that experience gained at national level is shared with other countries; calls on the Council to adopt at the Madrid European Council a Community framework which not only encourages exchanges of ideas and practices in the Member States but also provides European support for local employment initiatives within the framework of the Structural Funds and includes Community measures to create conditions favourable to the development of local employment initiatives;

13. Takes the view, having regard to the need not to endanger competitiveness, that employment could also be promoted by examining with the social partners at the appropriate levels the allocation of productivity gains to innovative forms of work such as reorganisation, reduction and new patterns of working time which could improve the quality of work and life; notes the Commission's proposals on 'flexibility of employment and protection of workers' and calls on the two sides of industry to respond positively to these proposals; and considers that greater flexibility of the labour market should not be achieved at the expense of the workers concerned or the quality of jobs, particularly to the disadvantage of women;

14. Is of the opinion that positive flexibility in various aspects of the labour market will have a favourable impact on the growth of employment, and that it will make the labour market more accessible to young people, women and long-term unemployed - the main problem categories - as described in the Delors White Paper, so that flexibility should be taken as a different planning of working life and different forms of organization;

15. Notes the Commission's view that increases in productivity generate more employment only if accompanied by real but moderate increases in wages; notes however that in the recent past wage restraint has merely increased business profits, without always leading to greater investment or more employment; calls on the two sides of industry to enter into satisfactory commitments through collective consultations to share the benefits of increases in productivity equitably between business profits, used to increase productive investment, positive but moderate wage increases, particularly for the lowest paid groups, and binding agreements on additional employment; calls on the Member States and the social interlocutors to take advantage of the growth in productivity primarily in order to create new jobs, in the firm belief that SMEs and, in particular, small businesses have the greatest potential for job creation of all types of business;

16. Calls for the Madrid European Council to take decisions on additional financing for the realization of trans-European networks, environmental investment, research and development policy and the information infrastructure, as provided for in the White Paper and decided upon at the Brussels European Council in December 1993; notes that an important component of an active labour market policy should be a job-creating strategy based on ecological restructuring, by means of which, according to an unpublished preliminary study on the Commission White Paper, over two million jobs could be created; calls on the Commission to submit as soon as possible practical proposals for environmental investment ('Joint Environment Projects');

III. Strategy towards a European Employment Union

17. Stresses to the Council the urgent need to adopt a coherent strategy for employment, implementing and following up progress in the five key areas established by the Essen European Council; calls for the Madrid European Council to establish an analysis and assessment procedure for monitoring and coordinating relevant policies which will allow the European Commission to assess the results; calls on the Council to reconcile the various financial instruments of the Union - particularly the European Investment Bank, an enhanced European Investment Fund and the Structural Funds - with national policies pertaining to employment; proposes, in this connection, that the annual Structural Fund review process should be initiated at the same time as the employment monitoring procedure, with more stringent checks on Member States which are not using ESF funds in accordance with the agreed employment objectives;

18. Calls, therefore, on the Council to apply the employment monitoring procedures to assess the Member States' multiannual programmes on employment, taking into account the views on a monitoring procedure expressed in the report by the Temporary Committee on Employment; calls for the necessary agreements to be reached on the operation of these procedures, compliance with the deadlines and the preparation of appropriate monitoring and coordination instruments; calls on the Council to improve coordination and cooperation between the Ad Hoc Group on Employment and the Committee on Economic Policy, and to place it on an equal footing, leading to the joint preparation of a common report on employment policy for the European Council, taking into account the Commission report on employment and the overview report; calls on the Council to take account more clearly of the results of the monitoring procedure for employment policy in drawing up the economic guidelines;

19. Calls on the Commission to present proposals for the use of comparable socio-economic indicators, monitoring qualitative and quantitative changes in the labour market and the policies of the Member States and ensure that in all the Member States of the Union the criteria for measuring or quantifying the unemployment and employment indicators are homogeneous and hence comparable; takes the view that such indicators are instrumental in the implementation of a monitoring procedure; to that effect stresses also the need for improved statistical data concerning the labour force and monitoring of employment trends; supports the Commission's 'Essen' proposal for Community action and calls on the Council to adopt it;

20. Calls for an interinstitutional agreement to be concluded on the procedure for monitoring employment, in which connection the European Parliament should be able to play a more active role in order to eliminate the democratic deficit in the existing procedure; calls upon the Commission to submit without delay its proposal for the restructuring of the Standing Committee on Employment, so that the two sides of industry can be fully involved in preparing, monitoring and evaluating employment policy;

21. Supports the idea of holding an annual employment conference as a means of exchanging ideas and examples of successful policies between Member States and providing a forum for an open debate on employment policy in the European Union and is in favour of assessing annually the outcome of such a conference;

22. Proposes, in order to improve the employment policy of the Union and of Member States, who, together with both sides of industry, must take the main responsibility for raising the level of employment, the insertion in the Treaty of a new chapter on employment policy ('Employment Union') explicitly describing objectives, procedures, monitoring criteria and the coordination of national measures, in order to achieve the aim of full employment; believes that, by analogy with the procedure for economic and monetary union, provision must be made for formulating employment guidelines, Council recommendations to the Member States and penalties for non-compliance, but also incentives to meet the objectives; the Council should be entrusted with the responsibility for adopting employment guidelines, in addition to economic guidelines, to ensure coherence between economic and employment policies and to provide for the setting-up of an employment committee with a status and remit similar to those of the Monetary Committee provided for in Article 109c of the EC Treaty;

23. Instructs its President to forward this resolution to the European Council, the Council, the Commission, the Economic and Social Committee, the European social partners and the governments and parliaments of the Member States.