EU employment commissioner Vladimir Spidla speaks to JAMIE SMYTH, European Correspondent
THE GOVERNMENT should follow Austria, Denmark and the Netherlands in considering introducing innovative work practices and retraining schemes to combat unemployment.
It was also reminded of the enormous benefits of the social partnership model by EU employment commissioner Vladimir Spidla on the eve of the EU employment summit today in Prague.
“My strong personal conviction is that social dialogue is necessary and is a strong tool to address the crisis. In Ireland, past agreements between employers and unions have helped enormously,” he says. “Of course, it is naturally harder to agree when times are tough.”
Talks on restarting the social partnership process in Ireland fell apart this week, but its benefits will be one of the examples of “best practice” highlighted at the summit today, attended by the prime ministers of the Czech Republic, Sweden and Spain.
There are currently 20 million people out of work in the EU, four million more than at the same time last year as a result of the financial crisis. The commission predicts a further six million jobs lost this year, pushing unemployment to 11.5 per cent in 2010. Spanish joblessness, which is already the highest in Europe, will top 20 per cent.
In Ireland, where unemployment is expected to breach 16 per cent next year, it is essential the Government takes action to ensure that laid-off workers do not lose their skills, says Mr Spidla. “Skills are lost very quickly, which has a negative impact on society,” he adds.
Fast-rising unemployment also increases the risk of social tensions and unrest. Minority groups such as the Roma also become more vulnerable in a downturn, which underlines the need for governments to put in place measures to help laid-off workers, he says.
“In Austria, employers offer short-time working to enable more people to stay in work despite the crisis. Retraining for laid-off workers is also vitally important because they probably won’t be doing the same jobs again,” says Mr Spidla, who mentions Denmark and the Netherlands as two countries with good practices. “The Irish economy will not be the same when this crisis ends so there will be a need for different skills,” he says.
Another idea to be presented today is for governments to reduce the national insurance costs paid by businesses for employees and absorb the additional cost themselves. This should incentivise employers to retain more staff rather than let them go.
The leaders will also announce plans to make it easier for member-states to access the commission’s globalisation adjustment fund (GAF)- a €500 million annual pot of cash to help states bear the cost of retraining, support unemployed workers to set up their own businesses and access counselling services.
This fund will be accessible when 500 jobs are lost, rather than 1,000 jobs at present and the union will now pay 65 per cent of the costs of retraining rather than just 50 per cent.
The Government is expected to make an application for tens of millions of euro to cover the job losses at Dell in Limerick.
“On the social side, the EU can help by showing solidarity,” says Mr Spidla. He adds that the Lisbon Treaty would also help the union to build its competences in the area.
“With the Lisbon Treaty ratification, social rights would become primary rights in EU law for the first time through the charter of fundamental rights, which is a mini-revolution,” says Mr Spidla.
He says the commission is open to any suggestions that Ireland might make to them about clarifying the issue of “workers’ rights” in the treaty. But so far it is unclear exactly what clarification the Government wants to achieve in this sensitive area.
The EU job summit proposals will focus on a range of methods by which to keep people in work.
Key among these will be the incentivising of firms by governments to consider temporary adjustments in working hours of employees to prevent layoffs. In this respect, money from the European Social Fund can help.
Another point is that governments should also reduce the administrative burdens on small companies to reduce their running costs. In this respect, targeted help with the retraining of laid-off staff is essential for small to medium enterprises.
Governments should also improve the efficiency of national employment agencies by ensuring that all laid-off workers have early access to counselling and retraining.
They should increase the number of high-quality apprentice and traineeship places available to people losing their jobs, upgrading skills of workers at all levels and preventing young people from leaving school without the necessary skills to get a sustainable job.
Finally, it is deemed that governments, the commission and social partners should exchange best practice on to deal with restructuring of jobs during the crisis.