households. looking ahead, this could make it possible to ease the concentration of the tax burden and step up incentives for labour and enterprise. the tax wedge on labour income in italy is 5. 5 percentage points higher than the euro - area average. the official tax rate on corporate income, even excluding the regional tax on productive activity, is more than 4 points higher. in the medium term significant tax cuts must be accompanied by curbs on spending. if gains on this front were made more rapidly, there could be an attenuation of the rise in vat rates provided for in case of failure to implement the tax and welfare enabling act, in particular the projected rise on items currently subject to the reduced rate of 10 per cent, which would have the most strongly regressive effect on income distribution. with a view to stimulating a return to faster economic growth, the structural measures contained in the decree remove some constraints and restrictions on competition and business activity and will simplify and accelerate the realization of infrastructure projects. bis central bankers ’ speeches the liberalization of pharmacies, retailing and transport resumes the reform processes initiated in the second half of the last decade. powers of regulation and monitoring are assigned to independent authorities ( which will incorporate today ’ s existing agencies ) in the sectors of water management and postal services. this is a course already given significant impulse by the measures taken during the summer concerning professional services and local public services ; it must be resolutely pursued with effective implementation of the measures already enacted. further reforms will be needed to make the set of structural actions consistent and comprehensive, with priorities being established and account taken of italy ’ s standing in the most common international rankings, in order to improve the perception of the country system by foreign investors as well. the government ’ s decision not to intervene immediately, in the decree, on issues involving employment relations and unemployment and welfare benefits will make it possible to hear the views of labour and employer organizations. nevertheless, action on these matters is urgent, in particular to provide for easier and more secure access to the job market for young people and ensure that they can achieve economic advancement that is not ephemeral. welfare reform should form part of an overall vision of social protection guided by the principle of universality. this means, among other things, combining the income support programmes for workers who lose their jobs with active policies of retraining and occupational reintegration. 3. the outlook over the past few months the outlook for growth in the euro

mechanism ) must adopt strategies to improve the management of these assets together with ambitious operational plans to ensure their substantial and progressive reduction. possible options include : the creation of separate and specialized management units, recourse to external managers, the sale of the portfolios on the market. we are working to extend the guidelines to the banks under our direct supervision. labour and growth it is in the labour market in particular that we see the most painful legacy of the crisis : in 2014 the unemployment rate came to nearly 13 per cent, more than double that of 2007 ( figure 7 ) ; unemployment among young persons aged 15 to 24 increased from 20 to over 40 per cent ; the figures are higher in the south. the gap between the quality of the positions offered and workers ’ expectations widened : nearly all fixed - term employees would prefer a permanent position, while two thirds of part - time workers would like a full - time job, compared with two fifths ten years ago. households ’ living standards have fallen, especially for the most disadvantaged. there has been some improvement in the last two years thanks to the cyclical recovery, social security contribution relief and measures to improve the efficiency of the labour market. however, at the end of 2016, less than 60 per cent of people aged 20 to 67 were employed and only one out of two women. about a quarter of people younger than 30, and a third in the south, were not in education, employment or training. these figures are far from those of most other european countries. the question of labour is central. it relates to social integration and personal identity. on the economic level, it should not be seen solely as a cyclical problem : the economy ’ s growth potential depends on the quantity and quality of the labour force and the capacity of the productive economy to provide adequate employment. demographic and technological tendencies play an important role, destined to increase in the years to come. according to istat, whose forecasts even assume a net annual influx of about 150, 000 migrants, the number of people aged 20 to 69 will fall by nearly 7 million in the next 30 years. the population older than 70 will increase to about 30 per cent of the total, with important repercussions on the composition of employment and further growth in the demand for jobs in personal care, assistance and health, which in the past 20 years have accounted for over a the governor ’ s concluding remarks annual report 2016 banca d ’ italia third of the increase in employment. increased labour