12. 6. 76 Official  Journal  of the European  Communities No C 131/45 
Opinion  on unemployment  in the Community 
The opinion  of the Committee  is not based  on any  text. 
A. LEGAL  BASIS  FOR  THE  OPINION 
At its 137th  plenary  session  held  on 25 February  1976  the Committee,  acting  on a 
proposal  from  the Bureau,  decided  to deliver  an opinion  on the abovementioned 
subject  on its own  initiative. 
B. OPINION  OF  THE  ECONOMIC  AND  SOCIAL  COMMITTEE 
The Economic  and  Social  Committee  prepared  its opinion  on the above  matter  at 
its 137th  plenary  session,  held  in Brussels  on 25 and  26 February  1976. 
The full  text  of the opinion  is as follows: 
THE  ECONOMIC  AND  SOCIAL  COMMITTEE, 
Having  regard  to the decision  of the Chairman  of 
the Economic  and  Social  Committee  on  3 
February  1976,  and  the decision  of the Bureau  at 
its meeting  on 27 January  1976,  and  confirmed 
by the  Committee  at its plenary  session  on 25 
February  1976,  appointing  Mr Basnett  as general 
rapporteur  to draw  up an opinion  on unemploy-
ment  in the Community, 
Having  regard  to Articles  18, 20 (4) and  46 of its 
Rules  of Procedure, 
Having  regard  to the  discussions  at its 137th 
plenary  session  on 25 and  26 February  1976 
(sitting  of 26 February), 
HAS  ADOPTED  THE  FOLLOWING  OPINION 
by 40 votes  to three  with  14 abstentions: 
1. Introduction 
1.1. The  scale  and  persistence  of unemploy-
ment  in the Community  represents  human  suffer-ing; it is an unacceptable  waste  of human  resour-
ces and  potentially  a danger  to social  stability. 
1.2. At  present  there  are more  than  5-3  million 
people  wholly  without  employment  in the Com-
munity,  and  the number  has continued  to grow  in 
recent  months. 
1.3. Despite  the  recent  signs  of recovery  of 
production  there  is no  doubt  that,  with 
unchanged  policies,  most  countries  of the  Com-
munity  will  experience  even  higher  levels  of 
unemployment  through  1976  and  into  1977.  This 
is because  of the  time  lags  between  economic 
recovery  and  its effect  on employment  and  also 
because  of the structural  changes  that  are causing 
unemployment. 
1.4. The  citizens  of every  member  country  are 
rightly  asking  what  their  national  governments 
will do to reduce  unemployment  quickly  and 
substantially.  They  have  begun  to ask  what  the 
Community  itself  will  contribute  to remedy  a 
situation  which  is international  in scope  and 
origins,  and  for  which  international  remedies 
must  be applied. 
2. National  measures 
2.1. The  Economic  and  Social  Committee  con-
siders  that  the  Council  should  urge  on govern-
No C 131/46 Official  Journal  of the European  Communities 12. 6. 76 
ments  the  need  to single  out  the  reduction  of 
unemployment  as an economic  objective  requir-
ing the most  urgent  attention. 
2.2. Governments  should  be asked  to work  out 
national  targets  for reductions  in unemployment 
levels  within  a specified  time  indicating  practical 
methods  of achieving  such  targets  which  take  into 
account  all of the economic,  industrial,  and  social 
factors  which  have  a bearing  on the achievement 
of the target.  That  should  be done  at once. 
2.3. The  aim  should  be both  to protect  existing 
employment  and  to create  new  jobs.  This  should 
be done  through  measures  such  as: 
— advance  notification  of redundancies; 
— temporary  employment  subsidies  to maintain 
work  forces  until  the recession  passes; 
— new  subsidies  creating  new  employment  in the 
regions  needing  it most. 
2.4. The  expansion  of the  construction  in-
dustry  is both  quick-acting  in employment  terms 
and has a low  import-content. 
2.5. The  Government  should  be urged  to pro-
vide finance: 
— to enable  firms  to build  up stocks; 
— to promote  investment  in industries  and  occu-
pations  directly  under  their  control; 
— to undertake  investment  in public  works  pro-
jects. 
2.6. The  financial  sector  should  orientate  its 
lending  policy  so as to give  priority  to regenerat-
ing the industrial  base  in Community  countries. 
3. Community  institutional  measures 
3.1. The  Committee  recognizes  that  the Com-
munity  itself  is limited  in respect  of its resources 
and the direct  action  that  it can take. 3.2. The  Social  and  Regional  Funds  have 
undoubtedly  helped  to prevent  unemployment 
from  increasing  faster  than  it would  otherwise 
have  done  by encouraging  governments  to invest 
more  in training  and  in regional  aids.  Compared 
to needs,  however,  the  resources  available  are 
modest,  and  in the  short-term  it seems  unlikely 
that they  can  make  much  impact  on unemploy-
ment. 
3.3. The  Council  should,  therefore,  ensure  that 
resources  are  increased  in line  with  the  evident 
needs  of several  of the Community  countries  for 
structural  adaptation. 
3.4. The  European  Investment  Bank  could  also 
be used  to a greater  extent  to promote  infrastruc-
tural  and  industrial  investment. 
4. Community  cooperation 
4.1. In  order  to realize  the  primary  aim  of 
maximum  employment  creation  within  the Com-
munity,  the Council  should  bring  the representa-
tives  of national  governments  together  more  fre-
quently  (within  the Economic  Policy  Committee). 
The Council  should  ensure  that  national  policies 
are coordinated  more  effectively  so as to improve 
the employment  situation  and  the mutual  consis-
tency  of national  economic  growth  and  balance-
of-payments  targets. 
4.2. The  Committee  would  expect  to find  that 
the extent  to which  unemployment  can  be 
reduced  largely  depends  on the  development  of 
international  trade.  It considers,  therefore,  that 
within  the  Community  a special  responsibility 
falls on those  countries  with  balance  of payments 
surpluses  to take  a lead  in expanding  their  level 
of demand  whether  for investment  or otherwise. 
4.3. There  are  signs  that  inflation  rates  are 
now abating  in nearly  all of the countries  of the 
Community.  There  is widespread  unused  and 
underused  capacity  in the  Community,  and 
expansion  as indicated  here  could  reduce  unit 
costs  of production  in many  industries  and  under-
takings. 
4.4. Reductions  in unemployment  would  be 
accompanied  by savings  in payments  of unem-
12. 6. 76 Official  Journal  of the European  Communities No C 131/47 
ployment  and  related  social  security  benefits. 
These  are  grounds  for  believing  that  expansion 
and the  provision  of jobs  can  be consistent  with 
the control  of inflation. 
4.5. The  Committee,  however,  accepts  that 
national  action  to  promote  investment  and 
employment  on a worthwhile  scale  may  carry 
some  risk  of a modest  rise  in some  prices  — at 
least  if it is to reduce  unemployment  in the short 
term.  But  that  risk  can  be diminished  by the 
coordination  of national  measures. 
4.6. This  risk  should  be set against  the  even 
greater  one  of bottlenecks  contributing  to higher 
levels  of inflation  in the  economic  upturn,  if 
measures  are not  taken  now  to increase  provision 
for training,  to build  up stocks,  and  to provide 
new capacity.  Such  a situation  would  further 
prejudice  long-term  economic  growth  in the 
Community. 
5. Conclusion 
5.1. The  Committee  would  emphasize  that  its 
opinion  and  the  suggestions  contained  therein 
relate  mainly  to the  short-term.  The  Committee realizes  that  for the longer-term  a more  structural 
approach  to unemployment  is necessary. 
5.2. The  Committee  believes  that  Community 
action,  of the  kind  proposed,  can  reduce  unem-
ployment  this  year,  providing  governments  get 
together  now  on a coordinated  programme.  All 
of the  Governments  of the  Community  must 
resolve  to develop  means  of avoiding  another 
crisis  like  the  one  Europe  is currently  passing 
through.  The  Committee  earnestly  hopes  that  this 
initiative  will  give  a lead  in the  drive  towards 
higher  levels  of cooperation,  the benefits  of which 
will quickly  be felt by the people  of the Commun-
ity — and  especially  by those  millions  presently 
without  a job. 
5.3. In  conclusion,  the  Committee  takes  the 
view  that  Community  and  national  government 
measures  can  only  achieve  their  intended  objec-
tives,  if they  are strongly  supported  by small-  and 
medium-sized  businesses,  workers,  the  profes-
sions  and  professional  organizations.  The  Com-
mittee  therefore  earnestly  urges  these  groups  to 
do all in their  power  to ensure  that  such  measures 
will yield  the optimum  results. 
Done  at Brussels,  26 February  1976. 
The Chairman 
of the Economic  and  Social  Committee 
Henri  CANONGE 
ANNEX 
to the opinion  of the Economic  and  Social  Committee 
The following  amendments  were  rejected  during  the discussion: 
Paragraph  2.3 
Read  as follows: 
'The  aim  should  be both  to maintain  existing  employment  and  to create  new  jobs.' 
The remainder  of this  paragraph  is, therefore,  deleted. 
No C 131/48 Official  Journal  of the European  Communities 12. 6. 76 
Paragraphs  2.4,  2.5 and  2.6 
It is proposed  that  these  three  paragraphs  be deleted. 
These  two  amendments  were  combined,  and  the voting  was  as follows: 
For: 16, against:  39, abstentions:  5. 
Paragraph  4.3 
Delete  the first  sentence  of this  paragraph  and  add  the following  phrase: 
' ... industries  and  undertakings,  if new  costs  are not imposed  on them.' 
Voting 
For: 19, against:  40, abstentions:  3. 
Paragraphs  4.4 
Amend  the last  sentence  to read: 
'There  are  grounds  for  believing  that  expansion  and  the  provision  of jobs  can,  and 
moreover  must  be consistent  with  the control  of inflation.' 
Voting 
For: 18, against:  39, abstentions:  4. 
Paragraphs  4.5 and  4.6 
Amalgamate  paragraphs  4.5 and  4.6 and  amend  them  to read: 
'National  action  to promote  investment  and  employment  on a worthwhile  scale  to reduce 
unemployment  will  lessen  the risk  of bottlenecks  contributing  to higher  levels  of inflation 
in the economic  upturn,  particularly  if measures  are  taken  now  to increase  provision  for 
training  and  to provide  new  capacity.' 
Voting 
For: 16, against:  35, abstentions:  6.