Opinion of the Economic and Social Committee on the 'Commission Communication - Proposal for guidelines for Member States' employment policies 1998` (98/C 19/28)

On 3 October 1997 Commissioner Flynn sent the Committee the 'Commission Communication - Proposal for guidelines for Member States' employment policies 1998` expressing his assurance that he could count on the Committee's support.

Together with the Joint Employment Report 1997 - based on the multi-annual programmes submitted by the Member States - and the Employment in Europe Report 1997 (COM(97) 479 final) also transmitted to the Committee, the Proposal for Guidelines is an important contribution to the extraordinary European Council in Luxembourg on 20 and 21 November and its follow-up according to the new procedure set out in the Employment Chapter.

At its plenary session meeting on 1 October 1997, the Committee decided, in accordance with Rule 11(4) and Rule 19(1) of its Rules of Procedure, to set up a subcommittee to prepare its work on the matter.

Given the very tight deadlines involved, necessary for the Committee to have an input to the Employment Summit, the subcommittee prepared the opinion under an urgency procedure, and in the light of the opinion already adopted on 1 October 1997 on the European Council on Employment (CES 991/97) which has been forwarded to the President of the European Council.

The subcommittee drew up a draft opinion on 21 October 1997 (rapporteur: Mrs van den Burg).

The Economic and Social Committee adopted the opinion set out below at its 349th plenary session (meeting of 30 October 1997) by 123 votes to 7, with 13 abstentions.

1. General comments

1.1. The Economic and Social Committee appreciates the preparations of the Commission entailed in the 1997 Employment in Europe Report and the Joint Employment Report and all its underlying research and statistics, culminating in the proposal for employment guidelines to be discussed at the November Employment Summit. They should be judged both as a contribution to the aspired success of this extraordinary summit, as well as a first attempt to apply in an anticipative way the Employment Chapter procedure of the new Treaty.

1.2. In its earlier Opinion on the European Council on Employment (CES 991/97), the Committee stressed the importance of an overall approach including a broad macro-economic framework. The Employment Summit should be more than a conference about Member States' labour market policies. The Summit must provide a firm employment-orientated basis to be integrated with the macro-economic policy mix outlined in the Broad Economic Guidelines issued every year on the basis of Article 103.

1.3. The Committee takes note of the fact that it is the Commission as a whole that has presented this proposal for guidelines focusing on labour market policies. The Committee looks forward to equally important contributions to the Summit in other policy fields, in particular policies for sustainable growth and investment, and in the taxation field. Due note has been taken of the activities of the European Investment Bank to present a further elaboration of the programme initiated by the Amsterdam Council, and of the growing sense of urgency in the Ecofin Council and in the Member States to come up with appropriate measures, inter alia in the field of taxation, that may positively influence the employment situation in the Member States. The Growth and Employment Policy Coordination Pact that the Committee wants the Summit to conclude should encompass this broader range of commitments.

1.3.1. For the future preparation of employment guidelines in the framework of the Treaty procedure, it is imperative that all relevant policy fields may be dealt with. The fields to be particularly focused on in future years must not be defined and restricted in advance. The Committee strongly recommends such an integrated, broader content for the employment guidelines.

1.4. Noting the intention expressed by Mr Juncker to initiate a top level meeting every half year of the 'Troika` of Council presidents with the leaders of the European social partners, the Committee underlines once again its call to coordinate the contribution of all the players mentioned under the Employment Chapter, and to establish an effective procedure and structure for future cooperation in the field of European employment policy. A proposal on this point should be prepared for the Summit, with action to follow. For its part, the Economic and Social Committee is eager to undertake the activities that it has proposed in its earlier opinion.

1.5. The Committee notes with satisfaction that a joint meeting of the Ecofin and Social Council is convened, preceding the Summit, as it had recommended. This joint council could:

- assess the present macro-economic and employment situation and prepare the outline for the employment policies integrated with the macro-economic policy mix in order to enhance the employment intensity of growth;

- integrate the respective policy fields that should be dealt with at the Summit;

- develop a continuous and effective method for cooperation, including roles that different advisory bodies could play.

2. Specific comments

2.1. In its earlier opinion, the Committee urged the setting of 'clear targets, performance criteria, suitable timetables and monitoring mechanisms entailing national reports and evaluations` (CES 991/97, point 2.1.3). The Committee welcomes the clear objectives that the Commission has formulated as regards the average European increase of the employment rate and the decrease of unemployment percentage levels over a period of five years. These objectives may be considered as an operational application of Article 2 of the Treaty, which can be realized only if the EU and the Member States actually put into effect the necessary employment policy measures and succeed in continuing the current and predicted economic growth of approximately 3 % GDP a year. The Committee again stresses that commitment is needed in order to achieve these aims, both in terms of the growth-stimulating macro-economic policy mix and the proposed measures to make growth more employment-intensive and to improve the participation and re-integration of job seekers with a weaker labour market position.

2.2. The Committee notes that the proposal for guidelines does not set specific targets adapted to the national situations in Member States. It is evident that the different national backgrounds and circumstances should lead to particular individual targets per Member State, and to an appropriate policy combination with particular emphasis adapted to the specific needs of that Member State. Together, these programmes of each Member State will lead to more coherence and convergence within the EU, and should result in achieving the average overall European objectives.

2.3. The Committee welcomes the strategic approach of the Commission to focus on four main lines of action for the Member States:

- entrepreneurship;

- employability;

- adaptability; and

- equal opportunities.

These actions must be integrated into a strategy that creates both flexibility and security.

The Committee acknowledges the importance of a balanced approach to the changes that need to be accomplished. Under the four headings the major challenges have been stated in a way that links economic and social demands. The Committee underlines the need to adopt an integrated approach rather than a restricted selective 'picking and choosing` of single items. Each Member State will obviously draw up its own combination of targets and measures, but in all cases a careful balance between flexibility and security is imperative.

2.4. The Committee also appreciates the quantified approach in several parts of the proposal for guidelines referring to instruments, such as the degree of participation in training and labour market measures. Also here a differentiation and specification adapted to the specific Member State's situation is necessary. Taking this into account, the degree of quantification should strike the right balance between ambition and realism.

2.5. The Committee notes the link between the chapter on entrepreneurship and the action plan developed by the EIB. The EIB is to play an important role in stimulating growth and investment, particularly in SMEs. The Committee would urge the EIB to adopt a more risk-taking attitude and a more focused approach to projects which can enhance employment-intensiveness and the quality of jobs, with due regard to their commercial viability.

2.6. The importance of education and training contained in the action line on employability, and of the improvement of the level of qualification of the European workforce, cannot be stressed enough. Both from the macro-economic aspect of competitiveness and capacity to innovate, and from the individual workers' interest, it is imperative for governments, the social partners and other relevant socio-economic agents to maximize effort in this field. The Committee particularly echoes the appeal to the social partners to come to (framework) agreements on, for example, apprenticeships and conditions for lifelong learning, noting that it is particularly important to involve individual companies, and sectoral organizations where appropriate, and encourage commitments at a decentralized level. At the same time, it stresses the importance of innovation and adaptation of the general education system to meet these challenges. The Council of Education Ministers might be invited to elaborate further on the issues of employability and lifelong learning.

2.7. In the context of the adaptation of the work organization mention is made of the changes in employment contracts. It is rightly stressed that, to get more flexibility out of the labour market, more and better security is imperative. Also here it is urgent to promote balanced (framework) agreements between the social partners at different levels, as well as initiatives of the Commission and Member States to adapt and innovate legislation, particularly with respect to the situation of 'non-standard` workers. The Committee proposes that the Commission could draw up a new Social Action Programme, in which its own initiatives may be presented using the opportunities in the Social Chapter that now is fully integrated in the new Treaty, and calls on the Social Partners to fully play their role in this respect.

2.8. Under the equal opportunities action line, the connection is made between labour market and demographic demands. It is evident that an improvement of policies for reconciliation of work and family life may give an important impetus to a higher employment rate and a breakthrough of gender segregation in jobs. In this context, the Committee refers again to its October 1995 Opinion on working time (), in which it called for balanced options for reducing and reorganizing working time, including the promotion of opportunities for differentiated voluntary working time options, particularly in those sectors, jobs and function levels where long working weeks are the norm. More differentiation in working time may at the same time facilitate the reconciliation of work and family life, the redistribution of employment, and the flexibility of work organization. More ambitious and quantified targets may be expected from Member States as to the conditions for this fourth action line, such as the extension of the provision of good quality childcare facilities. Finally, it is essential to encourage a variety of educational choices of women in order to improve equal opportunities between women and men.

2.9. Taxation

In the previous Committee opinion, much emphasis was given to taxation as an instrument to stimulate job creation and to decrease unemployment. In the Joint Report, several examples are given of Member States' tax measures, particularly those which promote the hiring of low-skilled unemployed people, as well as measures to use social security benefits to create 'additional` jobs for these categories. The Committee would urge the Summit to initiate an evaluation and assessment of such measures, for instance by appointing an expert group and to make speedy proposals for a more structured approach aiming at reducing indirect labour costs in order to increase the employment intensiveness of growth.

2.10. Investment Policy

2.10.1. The Committee underlines the importance of encouraging investment in the EU. The Summit should call on the Member States to take all the necessary measures in this respect. This can only strengthen the economic basis and confidence, which are necessary conditions for employment creation.

2.10.2. The Committee has stressed the role of the EIB, and looks forward to the presentation of the EIB's Amsterdam Special Action Programme. The Committee recommends that the Bank involve social partners and other relevant organizations and experts in the labour market field in the development and evaluation of quantitative and qualitative criteria of employment-intensive investments. The Committee asks to be consulted on future work in this area.

Brussels, 30 October 1997.

The President of the Economic and Social Committee

Tom JENKINS

() OJ C 18, 22. 1. 1996.