The EU “needs a holistic approach” to address labour shortages

The 27 Social Affairs EU ministers are dealing with new measures to design against labour and skills shortages at European level. The debate arose during the first EU Council meeting held under the Hungarian rotating presidency. The action plan released by the European Commission last March provided the ground for the discussion.

According to this plan women, people with low qualifications, senior workers, young people people with an immigration background and people with disabilities are underrepresented in the labour market.

“We need targeted measures to incorporate and bring these people closer to the labour market but simultaneously we need to put workers in vulnerable sectors for the double transitions to stay or return to the labour market”, Hungarian Minister of State for Employment Policy Sándor Czomba, claimed during a public debate. The Hungarian minister also suggests adopting a holistic approach “to understand why some people are not active in the labour market”.

The Commission is considering a decline of 27 million in the working-age population by 2050 and a general 20% reduction from 2023 to 2100. This will result in a drop of 57 million people by 2100. “If we do nothing to offset these dynamics this could have very significant consequences on our growth prosperity and of course, our social systems”, European commissioner Nicolas Schmit stressed to the EU ministers.

“Policies should remove barriers to employment for underrepresented groups by also providing incentives to return or start working”, Schmit said. “This could be done by integrating effective targeted labour market policies with enabling measures that provide access to housing social services health care and then depending on the reason for the activity”, the European commissioner added. Ministers were also called to monitor tax systems and distributional impact to understand how they work in practice “and then revise them if necessary”.

Demographic trends make it essential to integrate these measures with the potential of legal migration. “Activating the domestic workforce alone will not be enough”, Schmit claimed during his intervention.

During the European social summit in Porto in 2021 EU leaders agreed to ensure that by 2030 at least 78 percent of the population between the ages of 20 and 64 will be precisely employed. By the same year, the European agenda in Employment policies aims at stimulating the participation in the training of at least 60% of all adults in the Union each year.

As stated by the Hungarian presidency in a press conference after the meeting “the debate provided for a fruitful exchange” on measures that many Member States had already taken to increase employment levels among young people and older workers, such as setting up job-matching platforms, improving working conditions and work-life balance, incentivising employers to provide upskilling and lifelong-learning opportunities, and introducing a flexible retirement age.

The Council meeting resulted also in the approval of the employment and social policy aspects of the country-specific recommendations for each Member State published by the European Commission last June.

Ministers also exchanged views on the most important measures and policy tools to promote quality and equal employment of persons with disabilities in the open labour market, such as awareness-raising campaigns and the exchange of best practices between EU Member States. The 2021-2030 Strategy for the Rights of Persons with Disabilities stands as the beacon in this policy field.

Ministers presented the initiatives already in place in their countries to help increase the employment rate for persons with disabilities, including national targets, quotas, incentives for employers and career mentoring schemes.