Brussels, 26/06/2007 (Agence Europe) - On Wednesday, the European Commission is due to adopt a communication modernising the labour market, by making it more flexible while ensuring strong social protection. The communication, drawn up by Vladimir Spidla at the request of the Council in March 2006, sets out common flexicurity principles and “pathways” to allow member states to meet the challenges they face as a result of rampant globalisation, such as too low employment levels or the need to raise workers' skill levels to enable them to find employment. To increase skill levels, there has to be greater investment in human capital and active labour market policies. The Commission hopes that the European summit in December 2007 will back the principles of the communication, thereby allowing it to begin the work of sharing good practice among member states. “This whole communication is targeted on social justice and a dynamic and fruitful knowledge economy, by sharing the fruits of labour more fairly in society,” Mr Spidla said, presenting the text to members of the European Policy Centre (EPC) on Tuesday.
The communication has four key elements: to have a flexicurity policy, there have to be - (1) flexible contracts, which, at the same time, provide security; - (2) comprehensive lifelong learning strategies; - (3) active labour market policies; - (4) good social protection systems which provide adequate financial assistance during periods of unemployment. It proposes eight common principles, of which the main ones are: (1) flexicurity must reduce the gap between those in permanent, full-time work and those on non-standard contracts, sometimes with little security, (2) developing internal (inside the company) and external (between companies) flexicurity, (3) flexicurity requires a climate of trust between social partners, public authorities and other stakeholders, (4) adapting flexicurity to the different circumstances, needs and challenges in member states.
The communication also puts forward four “pathways” for member states to develop their own flexicurity strategies suited to their national challenges. The first challenge is the segmentation of the labour market between “insiders” (those with long-term, stable contracts) and “outsiders” (those who do not have such contracts). As Xavier Prats Monné of DG Employment (coordination of ESF policy) and former Commission spokesman said, “This situation has its disadvantages. The fixed term contract is a trap. An open-ended contract means security, but it is also an illusion, because no one can force you to undergo more advanced training. This means that if your company goes bankrupt, you will have to take early retirement because the only skill one has is having fixed employment since one has not changed jobs”. Such a career path is of relevance to countries like Spain, France, Italy, Greece and Portugal, which are faced with this challenge. Spain is a typical example of the application of the flexicurity principle. Thus, said Mr Prats Monné (himself Spanish), 900,000 jobs were created between June 2004 and June 2005. Of these 900,000 jobs, a large proportion were fixed term contracts. “This situation is not good for anybody,” he said, “because fixed term contracts bring an increase in employment levels, but very little in terms of human development. There is nothing encouraging the employer to offer workers training, so fixed term contracts are a trap for everyone!” Reacting to this, the Spanish government, in 2006, got an agreement among social partners to change this kind of contract and ensure flow between fixed term and open-ended contracts, he added, pointing out that the government's aim had been to reduce the segmentation of the labour market. “The Spanish example is a good one for movement from the security of a job to a job in general, for life,” he concluded. The second challenge, a lethargic labour market: this challenge is relevant to Belgium, Germany, Austria, Luxembourg and France. There has to be greater employee mobility within the company and towards other companies. Thirdly, great differences in skill levels among the active population can slow mobility. The countries affected here are the United Kingdom, the Netherlands, Ireland and also some Scandinavian countries, like Denmark. Often employment levels are low compared with unemployment levels in these countries, bringing greater disparities to the labour market because many do not have the qualifications needed to have access to certain areas of the market, Mr Prats Monné added. The fourth challenge is the large economic restructuring of the last few years, as was the case in the new EU member states, which have not very generous social protection systems. These restructurings led to an appreciable increase in the number of long-term recipients of social benefits.
This communication has already provoked a variety of comments. Xavier Prats Monné indicated that the European Confederation of Trade Unions (ETUC) had expressed concerns about flexicurity becoming a synonym for flexibility, “to avoid redundancies”. This concern should not have arisen because Commissioner Spidla's communication clearly stated that flexicurity is a, “combination of flexibility and security at work”. According to the latest Eurobarometer on social policy, Europeans have understood the need to adapt to change, indicated Commissioner Spidla: 76% of them believe that a job for life is a thing of the past, 72% feel employment contracts should be more flexible so as to create more jobs and 88% share the view that lifelong learning improves employment chances. Prats Monné affirmed that, “Denmark is the country where people have the least fear about losing their jobs and young people have fewer fears about employers assessing their employability prospects”. (gb)