The European labour market and the refugees

José SIlva PENEDA

Principal adviser for European Social Policy in the European Policy Strategic Centre to the President of the European Commission.

The EU-28 has to face two major issues : an ageing population and a lack of investments in many sectors. The actual massive arrival of refugees seems to offer Europe the opportunity of building a real European labour market.

Within Europe, there are huge differences among Member States regarding culture, tradition and language, and these are reflected in the development of different social systems, including in the organization of labour markets.
One can speak about a real European Social Model only in terms of the core values at the origin of the European political and economic integration project. Those values are common to all Member States. The way those values are developed inside each Member State is quite another thing: there we find great differences as, for example, is the case for labour markets regulation.
This explains why social policies remain to a large extent the responsibility of Member States and why, in accordance with the “principle of subsidiarity”, the role of the European institutions is limited to supporting and complementing the activities at national level. At European level, regulation can be produced in some areas -for example on working practices or the protection of workers- and support provided to Member States to facilitate the coordination of their actions, or establish guidelines and to exchange best practices. But, to put it briefly, a European labour market doesn’t exist (yet?) and Europeans tools are limited. This will not change easely.
The great social problem in Europe is unemployment, both long-term and among young people, and its social implications are dramatic. But unemployment is not just a question of quantity. Europe is also facing a lack of quality jobs and increasing precariousness. Furthermore, the instruments for increasing the mobility of workers inside the EU are not effective, which confirms the non-existence of a really integrated labour market.
This situation only can be reversed through investment and this is the main reason for the European level support towards the Juncker Plan.  All the conditions for a much-needed increase in investment are currently present: low interest rates, decreasing oil prices, euro devaluation and the existence of large pools of liquidity.
It is within this context that Europe is facing an enormous influx of refugees. In my opinion, this is a challenge which needs a long-term vision as well as short-term measures. The European Union will undergo a significant decline of its population aged between 15 and 64 years. By 2050, this group will decline by around 50 million people!
A long-term vision, setting out an immigration policy where the management of population flows can be done in a coordinated manner, not only taking into account the economic and demographic situation of Europe but also with the countries of origin and developing new instruments capable of facilitating the integration of migrants into the social fabric of the destination country, is something that has to become a high priority in European policy.
If tackled properly, the increase in organised mobility of labour force from the Middle East and North Africa to Europe may turn out to be a win-win game. It may even bring about a true labour market.
The opinions expressed in this article are those of the author and do not represent the position of the European Commission.

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