COMMISSION OF THE EUROPEAN COMMUNITIES 
Brussels, 12.11.1997 
COM(97) 611 final 
COMMUNICATION FROM THE COMMISSION 
COMMUNITY POLICIES IN SUPPORT OF EMPLOYMENT 

AM OVERALL STRATEGY 
This problem has been at the core of 
European, national and individual 
concerns for years. The 
Commission's most recent 
projections anticipate thaï even with 
appreciably higher growth between 
now and 1999, the unemployment 
rate in the European Union will still 
be 9.7% in 1999 if its policies remain 
unchanged. 
What should we do? There is no 
magic solution. Only an overall 
strategy can produce a job-creating 
dynamic. 
We have already progressed towards 
this overall strategy: the White Paper 
on growth, competitiveness and 
employment, the coordination 
strategy defined at Essen, the 
incorporation of this into an 
integrated approach through the 
Confidence Pact for Employment 
approved in Florence, and finally, the 
consolidation of this strategy in the 
new Treaty. Step by step, the 
European Union has thus gradually-
acquired a common framework of 
reference, the coherence of which 
rests on three factors: 
i. It is an integrated strategy. 
Employment policy cannot be divided 
up into isolated components. It must 
incorporate side by side the three 
elements necessary for success: a 
sound macroeconornic framework, 
the effective realisation of the potential of the single market, 
ambitious reforms of labour markets. 
Of these three elements, the labour 
market aspect has until now been the 
least developed at European level. 
Agreement on the guidelines 
proposed by the Commission and the 
implementation of national action 
plans should give it renewed vigour. 
What this document does is look at 
how Community policies contribute to 
the overall strategy. It is thus a 
response to the Amsterdam 
European Council's wish to receive a 
report on Community action, noting 
the principal initiatives already 
undertaken and calling, where 
necessary, for new impetus. 
2, The strategy covers the short, 
medium and long term. 
The usefulness of a strategic 
approach lies in the fact that it 
enables action on the part of all 
participants to extend over the long 
term. The accelerating pace of 
change that we can all see today 
requires that we do more to reconcile 
urgent needs in the short term with 
preparation for the medium term. 
This is clearly the case for 
demographic change: by promoting 
an increase in employment rates 
today, we are preparing the ground 
for contending with ageing society 
tomorrow and facilitating the 
thoroughgoing reform of social 
protection. 
The level of unemployment 
remains worrylngjy high, at 
10,8% m rnid-1997, in 1996. 
more than $% of the Union's 
labour force had been out of 
work for at least a year, 
Some 600 000 new jobs were 
created m 1998, The service 
sector has created 1 to 
15 million jobs annually (except 
in 1993), while the more 
traditional sectors (agriculture 
and industry) have been In 
constant decline. 
Over the last ten years» job 
losses have been concentrated 
in sectors employing less than a 
quarter of the entire labour force 
of the Union. 
Since 1993, micro-enterprises 
with less than 10 employees 
have been recruiting twice as 
fast as major firms* 
Virtually the entire net increase 
m employment since 1990 Is 
accounted for by the growth in 
part-time working. 
The average unemployment 
rate among young people in the 
Union is still over 20%. 
However, there has been ai 
slight drop recently, in line with 
demographic trends and as a 
result of more young people 
staying on m education. 
Unemployment among women 
remains about $ percentage 
points higher than among men 
(12.7% as compared with 
9.4%). 
tmiàl nil liBïiilÉliiH lirtrtiWiHMIWH 
It is also true for the increasing speed 
of technological change, intensified 
by globalisation: this change is the 
source of new wealth, but it is not 
distributed evenly. The faster pace of change also entails a 
reorganisation of structures and 
social costs that can only be reduced 
by far-sighted employment 
management which will facilitate 
occupational and geographical 
mobility. This is also true for 
enlargement of the Union, which is 
seen by many as a constraint, 
whereas it already today and even 
more so in the medium term actually 
offers opportunities for renewed 
growth. 
We must react to the unemployment 
problem quickiy, and actually do 
something rather than just talk. We 
must also anticipate tomorrow's 
challenges by finding solutions to 
them today. Otherwise, the problem 
of unemployment will remain one of 
necessary adaptation rather than one 
of forward-looking dynamism. We are 
all aware of the major trends we are 
living through. But the responses we 
need to make are often postponed to 
a distant future. The European way is 
to allow initiative to create new jobs 
and also to provide benchmarks and 
references to help everybody plan 
for the future in so far as it is 
foreseeable. 
3. Success 
depends 
parties. of the strategy 
on mobilising all 
Because this strategy embraces the 
whole range of policies, it must 
appeal to all of the parties 
concerned. More than ever before, 
modernising initiatives come today 
from every quarter. The challenge is 
to break down dividing barriers and 
integrate the different initiatives in a 
common framework of reference. The 
actors in the employment field 
operate at very different levels. There 
are institutional actors at European, 
national and local level. Then of 
-2 
course there are the social partners, 
who are in the front line when it 
comes to maintaining and creating 
jobs. And finally there are 
associations and individuals. 
This mobilisation applies to 
Community policies themselves. The 
purpose of this document is to show 
how Community policies serve 
employment in the context of this 
overall strategy. 
Action by the Union is not parallel to 
ti^ai of the Member States simply 
because it is external to it. On the 
contrary, the two are interwoven in 
two respects: 
- EU action creates the frame of 
reference which can guarantee 
the compatibility of Member 
States' action and thus rsieass its 
full potential. The creation of a 
sound macroeconomic framework, 
the completion of the single 
market, the scrutiny of tax 
provisions, the state aids code, 
measures to simplify the business 
environment, labour market 
reforms, the prospect of 
sustainable development are all 
important factors here; 
- Union action complements and 
supports action by the 
Member States. The instruments 
specific to the Union dovetail with 
the measures already undertaken 
by the Member States, 
complementing them and thereby 
demonstrating the value added by 
the Community. This is true of 
research and innovation, the 
funding of small businesses, the 
information society and 
trans-European networks. Union 
action may also support steps by 
the Member States by following 
directly in the wake of national measures, as in the case of the 
Structural Funds. 
I Bumne as an economic entity 
The European economy m an 
inoreasittgly integrated economic 
entity. As the single market moves 
towards completion, cross-border 
movements of goods and services 
become no different to domestic 
movements. Corporate investment 
strategies and, hence, employment 
and growth policies must be 
increasingly conceived in terms of 
Europe as a whole. The volume of j 
the Union's external trade with the! 
rest of the world remains at a steady i 
level of 8% of Its Q'AF, au* 'his xmcu? < 
constitutes an inoraaslr^iy active > 
sttalani io comp&fïEsn. Th3 J 
dynamism o; Europe tfs^nds on ibl 
ability* to face global cotr^etîiion and ] 
develop its competitive strs-itniha. ,j 
The lorag*V&rm increase In tte growth ti 
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>ate of crpftai inveafcnont, ^u'rontfy 
tending at around 13% (compared 
with 24% at the begtehg of the 
1970s). Ovarii long run, n<arj5$a 
investmt^; infr^A'oUi^, ' 
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innov&îioa, &r*d human resource 
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-3 
COMMUNITY POLICES IN SUPPORT OF 
EMPLOYMENT: ENABLING, 
COMPLEMENTING AND SUPPORTING 
I. Union action creating an 
essential framework 
THE MACROECONOMIC FRAMEWORK 
The coherence of the employment 
strategy is guaranteed first and 
foremost by the European 
macroeconomic framework. A sound 
macroeconomic approach geared 
towards stability is a necessary 
condition but in itself it does not 
guarantee a high level of growth and 
employment. If economic and 
monetary union is to function 
smoothly, it will be even more 
essential for macroeconomic stability 
to complement structural reforms. But 
economic and monetary union will 
itself support the growth and 
employment dynamic. 
This convergence strategy, backed 
by structural actions, is already 
bearing fruit. The Commission's 
macroeconomic forecasts have been 
revised upwards and the latest 
projections suggest a return to a 
growth in employment of about 1% 
per year for the two years ahead. 
In the medium term, the 
arrangements for the changeover to 
the single currency are going to 
remove some of the macroeconomic 
obstacles to growth that have 
regularly had a debilitating effect on 
European performance. There will no 
longer be any risk of exchange rate 
crises occurring between the 
currencies of the countries 
participating. At the same time, the 
tension between monetary policy and 
national budgetary policies will 
diminish as a consequence of the discipline demanded by the Treaty 
provisions and by the Stability and 
Growth Pact. This framework of 
stability will make it easier for the 
social partners to negotiate pay 
agreements. There will be more 
chance of striking the balance of 
economic policies that is most 
favourable to growth and 
employment. The transformation of 
the current economic upswing into 
lasting growth in the medium term is 
the real challenge for the 
macroeconomic framework bolstered 
by EMU and the euro. 
+ With the expected introduction of 
the euro on 1 January 1999 and 
the growth prospects which are 
confirmed by the convergence 
process, the European Council in 
Luxembourg could restate the 
importance it attaches to 
economic coordination and in this 
context underline the importance 
of the joint declaration by the 
European social partners in 
support of the medium-term 
macroeconomic convergence 
and growth strategy. 
THE $INQLE MARKEI 
The Commission's initial assessment 
of the impact and effectiveness of the 
single market showed that the closer 
integration of markets and keener 
competition generated additional 
growth of 1 to 1.5% in the period 
from 1987 to 1993, creating 
considerably more jobs than would 
have been the case had the single 
market not existed. The assessment 
also showed, however, that there 
were still a large number of 
shortcomings which prevented the 
single market from functioning 
perfectly. 
Buoyed by its findings, the 
Commission presented an Action 
.4. 
Plan that adopts a clear and strategic 
approach to the action needing to be 
taken to improve the workings of the 
single market in the years ahead. 
This plan was endorsed by the 
Amsterdam European Council. It is 
now incumbent on all those involved 
to demonstrate a strong political will 
to work towards the rapid 
implementation of the priority actions 
listed in the plan. The Commission 
will keep a watchful eye on the 
achievement of these priorities, in 
particular by regularly publishing the 
"Single Market Scoreboard." 
+ The impetus provided by the 
European Council on 
employment will focus attention 
on the strict and effective 
implementation of the single 
market rules. For example, the 
provisions governing the opening 
up of the telecommunications 
market, where there is great 
potential for job creation, will 
have to be applied within the 
deadlines set. 
Restoring an employment-friendly 
tax system 
There can be no doubt that the 
taxation system is one of the areas 
where structural action can have the 
most far-reaching effects on 
employment. In this connection the 
Amsterdam European Council and 
the latest broad policy guidelines call 
for an overall reduction of the general 
level of taxation. However, European 
economic integration makes it 
increasingly difficult to embark at 
national level on tax reforms that are 
inspired by concern about 
employment. 
This is why the Commission regards 
it as essential that agreement be 
reached on guidelines aimed at 
guaranteeing greater fiscal coherence throughout Europe in 
three areas: 
• Implementation of a balanced 
tax package along the lines 
proposed by the Commission 
following up the work of the Tax 
Policy Group, including a code of 
good conduct in the field of 
company tax, common principles 
regarding the taxation of savings 
and the elimination of withholding 
taxes on interest and royalty 
payments between companies. 
The Ecofin Council will shortly be 
called on to give its opinion on 
this package. The aim is to 
combat harmful competition with 
regard to taxation, with a view to 
reversing current tendencies that 
lead to increased statutory 
charges on labour, especially on 
the low-skilled and least mobile. 
• The adoption of a Community 
framework for the taxation of 
energy products (excise duties, 
broadening the tax base to cover 
all energy products) leaving room 
for manoeuvre to reduce indirect 
labour costs. 
• Targeted reduction in VAT rates 
for labour-intensive services, so 
as to boost demand for such 
services and reduce moonlighting. 
The Commission recently adopted 
a communication on this subject, 
suggesting that a temporary 
experiment could be tried with 
services not affected by 
cross-border competition. 
Member States which so wished 
would be authorised to apply the 
reduced rate rather than the 
standard rate. This could play a 
supporting role alongside the 
measures stipulated in the first 
two points, which would be most 
5-
decisive for reducing indirect 
labour costs. 
+ The special European Council on 
employment could call on the 
Council of Ministers to reach 
agreement by the end of 1997 on 
the Commission's proposed 
overall package for combating 
harmful tax competition and to 
take a positive line on taxation of 
energy and the targeted 
reduction in VAT. 
Redirecting and reducing state aid 
Strict control over state aid to ensure 
compatibility with Community rules is 
the only way to establish fair 
competition and to avoid jobs in one 
place being created at the cost of job 
losses elsewhere. 
Here the Member States have a 
shared interest in coordinating their 
systems of state aid to reduce the 
overall sums involved which come to 
around ECU 100 billion a year. Much 
national aid still gives rise to mutual 
outbidding or a distortion of 
competition affecting the cohesion 
countries. The Commission plans to 
hold consultations with the Member 
States on this issue. 
+ The Commission also intends in 
due course to review the criteria 
for approving aid in order to 
foster schemes that genuinely 
promote economic efficiency and 
employment, including continuing 
training, the creation of lasting 
jobs and the smooth operation of 
the labour market In conjunction 
with the Member States it will 
devise a system of benchmarking 
to evaluate the effectiveness of 
the different national schemes in 
terms of employment. Simplifying the business 
environment, especially for 
smaller businesses 
The BEST Task Force on small 
businesses was set up following the 
Amsterdam European Council. It is 
made up of 15 leading figures with 
experience of the problems faced by 
small and medium-sized businesses. 
Its job is to provide an independent 
assessment of the measures that 
should be taken to simplify the 
administrative requirements and 
regulations that apply to businesses. 
In addition to legislation proper, the 
Task Force is also to examine other 
areas that could help encourage 
entrepreneurship, for example: 
- the availability of the basic 
services needed to run a 
business, such as financial 
management, bookkeeping and 
personnel management; 
- easier access to services 
provided by the often unduly 
complicated public authorities 
responsible for job centres and 
training schemes, social 
security regulations and iocai 
and national rules concerning 
standards and the environment; 
- training opportunities for people 
running businesses, their 
spouses and co-workers, 
including qualifications in 
traditional occupations (crafts, 
tourism, trading) where there is 
good employment potential. 
-6 
p. European and national 
legislation will be required to give 
effect to these recommendations. 
# 7"/7e BE SIT Task Force is to 
produce an interim report for the 
European Council on 
employment for finalisation 
ahead of the Cardiff European 
Council. 
& Before the Luxembourg 
European Council in December 
the Commission will be reporting 
on all simplification measures 
under way or planned: "Better 
lawmaking". 
STRUCTURAL REFORMS OF THE LABOUR 
MARKET 
Medium and long-term structura! 
reforms form the core of the draft 
'•ml 'eport and guidelines on 
-rr'loymeni acopted by *he 
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adaptability and ?qua« jpponunf.es 
Focusing on these pncn*:e? should 
help expand on this hitherto 
underdeveloped aspect of the 
integrated approach. Only if these 
structural reforms are a success will 
a genuine increase in the volume of 
job-creation be possible. 
!t is clear that this is primarily an area 
for national action. However, the 
Community framework is needed for 
exchanging good practices and 
setting shared objectives through 
guidelines. It will then be for ïne 
Member States to act en these 
guidelines in sine with the particular 
features of their own labour market. illifclllliiii % 
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Two agreements have been 
negotiated under Articles 3 and 4 of 
the Soefo! Policy Protocol. The first 
concern parental leave and the 
second pgrMime work. These 
agreements have been submitted to 
tN? Council to be implemented in the! 
form of a direstive. | 
Oocrpation-specific discussions aref 
held with twenty or so different 
I sectors and the social partners have' 
nm 140 
''is most importer j issued more 
I declarations* 
recent initiatives ?nctude: r< 
* a framework agreament cr.y 
apiculture for nationakevei j 
negotiations to reconcile { 
reductions in working time with8 
working time flexibility; 
« several charters and codes of 
good practice concerning, for 
example, child labour in the 
commercial, footwear, textiles ^6 
clothing sectors; | 
* memorandums on expanding! 
employment in the cleaning 
industry and in the distrib-jtivj j 
I trades, 
The social partners have a vital role 
to play here. A negotiated 
understanding on the need to strike a 
fundamental balance between labour 
market flexibility and job security for 
workers is at the heart of the 
European model. The agreement 
reached on part-time working is an 
important step along that path. The 
social dialogue summit on 
13 November should bring further 
progress, with a stronger 
commitment from the social partners 
to play their full role and to assume 
the^r responsibilities in this process. 
Similarly social dialogue should be 
stepped up in individual sectors,, 
endeavouring to emulate the success 
achieved in the agricultural sector. 
Across-the-board progress involving 
all sectors should be built on with 
agreements which supplement them 
and/or are specific to particular 
sectors. 
*& By way of advance application of 
the Treaty of Amsterdam, the 
European Council will call on the 
Council to adopt the first 
guidelines on national 
employment policies to be 
applied by the Member States 
through their national action 
plans. 
+ By laying the foundations for an 
outline agreement the negotiating 
partners at multi-sector level in 
Europe should give a European 
lead on resolving the problems of 
non-standard work and informing 
and consulting workers. 
EMPLOYMENT AND SUSTAINABLE 
The Member States have already 
started taking steps to encourage 
environmental activities which have a 
positive impact on employment, such 
as nature conservation, waste 
coiiection and processing and urban 
renewal. If this is to go further, there 
must be better safeguards for the sustainability of actual production 
and consumption. 
Oreen technology which creates or 
maJriMojmks 
1} 
2) In 1994, added value in the sector 
producing environmental 
technology and services came to 
ECU 90 bilfêerL providing work for 
more than 15 TfiKtcn people. 
These figures tV; not inertia 
technologies îo promote 
ener^y-sav'ng and the production 
of renewable .arms of energy. 
(n the United Kingdom a survey 
was done of 11 firms in various I 
branches of industry which hadf 
applied a strategy of reducing 
waste by introducing green 
technology* These firms saw their 
profits rise by some £4 million 
within four y*are In 70% of ca?es, 
the investment in energy-saving 
measures showed a positive 
return in Jess than a y<sar. 
?3)The management of a tannery m 
the Netherlands launched t 
target-oriented programme of 
investment In tntroductr/j clean 
technology. Vhi$ fed to t& rise in 
profit* thanks to reduced 
environmental costs (2% cf 
turnover) and sales of naw f/pes 
of by-products. 
This is a long-term exercise which 
will eventually lead to new jobs being 
created, and dictate whether existing 
jobs will continue to be viable into the 
future. But it calls for an overall 
sustained strategy for the whole 
European Union, if we are to cope 
with the costs of the switchover, 
which for certain types of firms (small 
businesses) and certain regions may 
be high. 
+ Before the employment summit 
the Commission will be adopting 
a communication on the 
environment and employment 
which defines such a strategy 
and suggests the first steps to be 
taken in embarking on it: 
identifying promising areas for 
investment in sustainable forms 
of technology, coherent use of 
the various awareness-raising 
instruments, and regulatory and 
fiscal incentives. Proposals for 
five key measures will be put 
forward. 
II. Action by the Union 
complements and supports 
action by the Member States 
RESEARCH AND INNOVATION 
The Union currently devotes a much 
smaller proportion of its gross 
domestic product to R&D than the 
United States or Japan. It is also 
some way behind in its capacity to 
turn research findings to good 
account quickly, with a view to 
launching new products and 
services. Extra efforts will have to be 
put in, both as regards steering 
research in the right directions, 
particularly towards making the best 
use of human resources, and in 
terms of disseminating new 
developments through exchanges of 
know-how via networks linking 
together companies and regions. 
These are the concerns which are at 
the heart of the scientific guidelines 
proposed by the Fifth framework 
programme for Community 
research, of which the six main 
subject-specific or across-the-board 
lines develop out of Member States' 
own endeavours in a multidisciplinary 
approach, targeting the European 
effort around nine basic criteria, one of them being employment. The 
same concerns are to be seen at 
work in the action plan on 
innovation presented in November 
1996. 
+ The new framework programme 
should be adopted in 
February 1998. Its specific 
programmes should be approved 
by summer 1998. In the same 
year, the first network of 
Innovation Training Centres and 
Educational Resource Centres is 
to be set up (based on an idea 
put forward in the Ciampi Group 
report), the object being to make 
technology transfer to small 
businesses easier. 
+ In response to the brief given to it 
by the Amsterdam European 
Council, the Commission has 
tabled a proposal for using the 
interest (some 40 MECUs per 
year) yielded by the ECSC 
assets to continue financing 
research in sectors associated 
with the coal and steel industries 
after 2002. 
INCREASED FINANCIAL RESOURCES FOR 
SMALL BUSINESSES 
The Board of Governors of the EIB 
has approved the broad lines of a 
special action programme 
determined at Amsterdam in support 
of employment policies. A start has 
been made on extending the Bank's 
activities to education, health, the 
urban environment and protection of 
the environment; many projects have 
already been presented for approval 
by the Board. To build the 
trans-European networks, the Bank 
is looking into the possibility of 
granting very long-term loans and 
raising the ceiling on financing to 
75% of the project cost. The Bank is 
9-
proposing that up to a billion ecus be 
allocated to support instruments for 
small businesses, especially in the 
field of technological innovation. 
Sustainable job creation by small 
businesses could also be promoted 
by Parliament's plan to devote up to 
ECU 450 million in the budget over 
three years to employment and 
innovation. Three types of 
complementary instruments covering 
the development phases of small 
businesses, from launch to maturity, 
would be introduced: 
- a risk capital window, focusing on 
certain stages in the life of a small 
business, to back up the European 
technological facility financed by 
the EIB and managed by the EIF; 
- a Community instrument offering 
assistance for the creation of Joint 
European Ventures; 
- a special guarantee mechanism 
for small businesses set up with 
the EIF to increase the risk-taking 
capacity of institutions financing 
small businesses. 
Ths, SMQnd, ntaffcftt M the 
United States; NASRAQ 
5 600 companies are quoted, 
including 1341 in the small 
business section. 
The volume of NASDAQ^ 
transactions exceeds that of the 
New York stock exchange, 
NASDAQ market capitalisation: 
the quoted value is greater than 
;*~ GDP of France 
W 1 8DD billion). 
NASDAQ was behind 18% of the 
new jofos (600 000) created in the 
United States between 1890 and 
V3S4. H is also estimated that 
'? rt.iliicr» j^bs are associated with 
r-u; fisnfe quoted on NASDAQ, 
'j-jtfvreJ. a-WiSJesMr The establishment of a specialised 
capital market at European ievel by 
2000 is a priority for the Commission. 
The American experience 
demonstrates that such a market, 
with its panoply of additional private 
instruments, has multiple beneficial 
spin-off effects for the development 
of small businesses with great growth 
potential, especially in high-tech 
sectors. Two initiatives along these 
lines were launched in Europe in 
1996: EASDAQ and Euro-NM. A 
specialised market integrated at 
European level will supplement and 
reinforce existing national 
experiments, providing them with the 
necessary critical mass. It will 
operate via an electronic network 
between national stock exchanges, 
which will require harmonisation at 
European level of the rules of 
business management (bookkeeping, 
European Company Statute), and the 
development of a reserve of skills 
needed to instruct and support new 
firms. 
+ The launching of the special 
EIB action programme and the 
agreement on the 
complementary instruments 
financed by the Community 
budget will be a major highlight of 
the European Council on 
employment. 
PROMOTION OF A „ SOCIETY WHERE 
The communications technology 
industries and services represent a 
fast-growing sector (about 10% per 
year). Europe has a twofold 
opportunity in this area, first, it can 
make optimum use of these 
technologies to become more 
competitive in every sector of the 
economy, and second, it can 
reinforce European supply in. the fast-
10 
growing segments of the market 
linked to the information society, 
especially the Internet. By 
responding to the dynamics of 
demand, and by anticipating the 
future needs of users in Europe and 
worldwide, Europe can build up the 
reputation and competitiveness of its 
producers. 
Electronic commerce illustrates this 
situation where the intensity and 
diversity of demand offer Europe 
tremendous opportunities to make 
the most of its know-how. The 
European dimension lends itself to 
innovation and new forms of 
commerce between businesses and 
between sellers and buyers. A 
Community initiative was launched in 
April this year to stimulate electronic 
commerce. It was followed in 
October 1997 by an initiative 
designed to develop digital signature 
and cryptographic services, which 
are an essential condition for the 
development of electronic commerce. 
The expansion of open networks is 
a new factor for growth and 
innovation for all businesses and 
individuals involved. Here again, 
there is enormous potential for 
activities and jobs created indirectly 
by services and software, which 
could meet new needs created by 
information and communication 
technologies, hence the crucial 
importance of the liberalisation of 
telecommunications infrastructures 
and services in the single market. Th» Internet: a potential source of 
&&& 
The internet shouid have a major 
impact on employment as it 
develops, In 1B98 It was estimated 
that the Internet was responsible, 
directly or indirectly, tor the creation 
of a million new jobs worldwide. At 
the start of 1097, around 70 million 
people were using the Net. This 
figure is expected to reach 
200 million by the year 2000, The 
range of services available on the 
Internet continues to expand ~ from 
200 Web sites in 1992 to 260 000 
commercial sites today, Revenue 
from electronic commerce on the 
Internet looks set to reach around 
ECU 200 billion by the year 2000. If 
the potential of the Internet Is to be 
used to the full, certain obstacles to 
the creation m^S expansion of 
innovative firms still have to be 
removed> 
The growth in demand is also closely 
linked to the general public's 
increasing familiarity with new on-line 
and multimedia technologies. In 
addition to awareness-raising 
campaigns, education and training 
also play a role of fundamental 
importance. 
+ The Commission will report by 
the end of 1998 on electronic 
commerce, the development of 
open networks and the use of 
multimedia tools for educational 
purposes. The report will 
examine how these things are 
being used and to what effect. 
il-
PARTNERSHirs FOR FINANCING THE 
TRANS-EUROPEAN NETWORK 
Setting up an integrated and well 
thought-out transport network at 
European level continues to be, in 
the first instance, one of the best 
ways of boosting Europe's 
competitiveness and hence 
employment too. It is also an 
essential adjunct to the single 
market. What is more, the networks 
will also have an impact on the 
labour market by generating new 
temporary jobs while they are being 
built. Progress will be ali the quicker if 
steps are taken to: 
- develop innovatory approaches 
as soon as possible, with 
partnerships between public 
and private bodies, to speed up 
implementation of priority 
projects; 
- extend the scope of the EIB 
instruments in accordance with 
the provisions agreed on at 
Amsterdam, in order to meet 
long-term project requirements 
at the same time as reducing 
the degree of dependence on 
guarantees with regard to third 
parties; 
- to ensure that, for each of the 
priority projects identified in 
Essen, the Member States 
concerned, in cooperation with 
the Commission, produce a 
clear timetable and a 
financing plan as a sign of 
their political commitment, as 
commitment will certainly be 
required to build up the 
momentum required for decisive 
action, and to make people 
aware of the benefits to be 
gained from the networks. 4- The Luxembourg European 
Council on employment should 
see the launching of the special 
EIB action plan for adapting the 
financing instruments for 
long-term TEN projects. 
4> The timetables and financing 
plans for priority projects could 
be discussed at the Cardiff 
European Council. 
EROMOTINQ EMPLOYMENT AND 
DEVELOPMENT^. THROUGH THE 
STRUCTURAL FUNDS 
The Union's structural policies are an 
expression of solidarity with the 
countries or regions engaged in the 
most difficult modernisation efforts 
and with the social groups 
experiencing the greatest difficulties 
in finding work. The Structural Funds 
are therefore an essential instrument 
both for the Union's economic and 
social cohesion and for the promotion 
of development and employment. 
With the promotion of an overall 
strategy, from the White Paper on 
growth, competitiveness and 
employment to the Confidence Pact 
for Employment, more and more has 
been done to focus the Structural 
Funds on the shared priorities of 
competitiveness and employment. 
The structural policies contribute 
through two complementary channels 
to attaining these priority aims: 
- By improving infrastructures and 
boosting productive investment in 
regions suffering from structural 
handicaps, they increase 
demand in these regions and in 
particular make them more 
attractive, thereby sustaining 
employment. 
12 
- By applying a wide variety of 
instruments adapted to the needs 
of all categories of the working 
population in order to ensure that 
human resources are used to 
maximum effect, the structural 
policies provide direct support for 
national or regional employment 
and social inclusion policies. 
The new provisions of the 
Amsterdam Treaty, in particular those 
in the employment chapter, ought to 
gear the structural policies more 
closely to the priorities of fighting 
unemployment and creating iobs. 
This was the thinking behind the 
Commission's proposal in 
Agenda 2000 for a new generation of 
programmes covering: 
two regionalised objectives: 
helping less developed regions to 
catch up (1) and promoting 
economic and sociai 
conversion (2), with due account 
being taken of the difficulties 
caused by structurai 
underdevelopment and of the 
problems encountered by 
industrial areas in decline, rural 
areas, derelict inner-city areas and 
coastal regions affected by the 
modernisation of the fishing 
industry; 
- one general objective (3) 
concerned with the development 
of human resources, which will 
thus become a major component 
of Structurai Fund operations 
throughout the European Union, 
capable of providing significant 
support for the action plans 
introduced in each country to give 
effect to the employment 
guidelines agreed at European 
level. for n»w requirements r*ew jgftsI 
Demographic shifts and changing 
lifestyles, in particular equal 
opportunities and the increase in the 
number of women in employment, 
bring with them new requirements: 
satisfying these requirements can 
generate a large increase in new 
employment especially in the areas 
of personal services such as childcare 
and aid for the elderly, quality of the 
environment and living conditions. 
leisure and culture. There is 
enormous potential for employment in 
the arts in the years to come; the 
audiovisual market, for instance, 
should grow by 70% in Europe by 
2005. 
Throughout the European Union, in 
the areas where there is a wealth of 
local development and 
smpioymant initiatives, up tc 
19 areas of high employment growth 
potential have been identified which 
could represent the equivalent of zn 
annual average of 0.25 percentage 
points of net job creation. 
Freeing rhis potential is often the 
result of $ local move, of which the 
mml :^wtopmerii boom of the 
1380s wg$ a forerunner. This move 
now sxtends to new urban 
réhabilitation and job-creation 
strategic?» which involve the resources 
of ths many associations, 
cooperatives and the like closely; 
interwovfcr. Into the economic fabric. 
The removal of obstacles to the1 
creation of these new jobs requires an 
approbate framework based on 
administrative decentralisation, 
openness of the public authorities to 
partnership with the private sector, 
clear references on the environment, 
energy, and transport and the 
récognition of new qualificatrons and 
skills. 
13-
Mirroring the Union's overall 
employment strategy, integration of 
the Structural Funds in the areas 
where they are applied together 
should be reinforced. Greater 
concentration on those areas, 
simplified procedures for paying over 
funds accompanied by tighter control 
and evaluation should enhance the 
effectiveness of the structural policies 
in promoting employment and 
business. Targeting Community 
resources on practices and measures 
with a large job-creating potential can 
also help. In this connection the 
implementation of the Territorial 
Pacts for Employment is a perfect 
opportunity for the Structural Funds 
to demonstrate coordinated support 
for the innovative approach of 
partnership, local development and 
decentralisation of employment 
policies. 
+ The Commission will be 
presenting the draft regulations 
for the new generation of 
structural policies in spring 1998. 
CONCLUSION 
Employment, the fight against 
unemployment and the creation of 
new business should continue to be 
the Union's priority. Neither the Union 
nor the Member States can ignore 
the structural reforms that this priority 
will require. Joint action will be 
needed if the reforms are to be truly 
successful. 
Sceptics will be thinking that 
statements like this proclaiming good 
intentions have been made before, to 
no avail. The first response must be 
to point to the window of opportunity 
now open thanks to the 
macroeconomic climate, more favourable now than at any time in 
the last six years. They must also be 
made aware of the advantages and 
opportunities that exist in European 
societies : changing demographic 
structures and the related new values 
and new needs; the considerable, 
and probably underestimated, 
spin-off effects of the euro and 
enlargement. Lastly, there is a 
comprehensive European strategy, 
the coherence of which can be seen 
from the way Community and 
national measures complement each 
other. 
The European Council on 
employment will be the opportunity to 
transform intentions into action, by 
demonstrating the Member States' 
resolve to work together to promote 
employment. This will take the form 
of the application, ahead of the entry 
into force of the Treaty of 
Amsterdam, of the jointly agreed 
guidelines for national policies. The 
unqualified support of each country 
for the overall strategy will rule out 
any risk of breaking of ranks and 
acting in isolation. Only if the 
European dimension is fully realised 
will the necessary confidence be built 
up: confidence of Europeans m each 
Member State's determination, 
confidence of Europeans in 
themselves. 
14-

ISSN 0254-1475 
COM(97)611 final 
DOCUMENTS 
EN 04 05 06 
Catalogue number : CB-CO-97-622-EN-C 
ISBN 92-78-27638-3 
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