WRITTEN QUESTION E-0829/02

by Salvador Garriga Polledo (PPE-DE) to the Commission

(26 March 2002)

Subject: The Achilles' heel of productivity

Many analysts continue to take the view that, both in individual sectors and in individual countries, the Community economy is still displaying an endemic defect namely, the Achilles' heel of productivity. On the whole it may be said that the Community economy has performed reasonably well in terms of relative growth, but at the same time it has recorded virtually no increase in productivity.

Since Europe's lacklustre productivity (by comparison with its major international competitors) is a significant cause for concern, the Commission should take it upon itself to promote an awareness-raising campaign within the EU in order to reverse the decline in productivity and make productivity an essential yardstick in its efforts to spur on the EU economy as a whole.

Does the Commission not regard it as its job to urge the Member States to consider productivity as an essential factor in the EU's international competitiveness?

Answer given by Mr Solbes Mira on behalf of the Commission

(29 May 2002)

At the Lisbon Special European Council held in March 2000, the Union set itself the strategic goal for the next decade: to become the most competitive and dynamic knowledge-based economy in the world capable of sustainable economic growth with more and better jobs and greater social cohesion. The Lisbon Council acknowledged the need to regularly discuss and assess progress made in achieving this goal on the basis of commonly agreed indicators.

To this end, the Commission draws up an annual spring report on progress on the basis of structural indicators related to economic background, employment, economic reform, social cohesion and the environment. Labour productivity, (per person employed and per hour worked), is one of the structural indicators agreed on by the Council and the Commission to be used in the Commission's spring report to the spring European Councils. The purpose of this indicator is to monitor the overall efficiency and dynamism of the economic system together with its competitiveness in relation to other world economies.

The Commission has also been using labour productivity in its annual report on the implementation of the Broad Economic Policy Guidelines as one of the indicators to measure the degree of achievement of the challenges set by the Lisbon agenda and the attainment of an outstanding economic performance. Productivity is also the subject of the Communication(1) Productivity: the Key to the Competitiveness of European Economies and Enterprises adopted by the Commission on 15 May 2002.

Labour productivity growth in the Union is relatively low and has actually slowed by ½ percentage point on average between the first and second half of the 1990s. However, at the cycle's peak in 2000, the rate was back at the average of the early 1990s reaching 1,5 %. Many of the policies covered by the Lisbon process aim at increasing this productivity growth and the competitiveness of the Union. For example the Barcelona European Council (15 and 16 March 2002) agreed many measures which should stimulate productivity improvements including: increased competition and inter-connection in the electricity and gas sectors; improved application of Internal Market rules; and the promotion of skills and recognition of professional qualifications across the Union. The key challenge for the Union now is to turn these agreed policy measures into concrete action and improvements in the Union's level of productivity.

(1) COM(2002) 240.