Jackie morin shaping the eu response to long term unemployment

Shaping the EU response to long term unemployment

Jackie Morin DG Employment, Social Affairs & Inclusion European Commission 11 March 2015

Political orientations

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Commission Work Programme 2015 - COM(2014)910 Member States are facing the difficult challenge of getting more people into work, and ensuring that workers have the skills they need to progress and adapt to the jobs of the future. The Commission will present a package of measures to support these efforts to help boost integration in the labour market and promote skills New initiative : Proposal for a Council recommendation on integration of the long term unemployed

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Council Conclusions on "2015 Annual Growth Survey and Joint Employment Report" and on "Inclusive labour markets" (9 March

2015) Preventing and reducing long-term unemployment: through improved efficiency of public employment services, the effectiveness of activation and make work pay measures, and by investing in human capital as well as tailor-made active labour markets policies and integrated social services.

Unemployment challenge

Long –term Unemployment is the main legacy of the crisis

•

11.9 million long term unemployed (49% unemployed) 59% very long term unemployed

•

Every year, 19% fall into inactivity; more than 50% remain unemployed

•

High incidence among prime age and older workers

•

Increasingly high proportions of low skilled are long term unemployed, contributing to polarisation and inequalities

Recent evolution

6

60

5

50

4

40

3

30

2

20

1

10

0

0 Q1

Q2

Q3

2009

Q4

Q1

Q2

Q3

Q4

Q1

Q2

2010

Share of long-term unemployed in total unemployment

Q3

2011

Q4

Q1

Q2

Q3

Q4

2012 Long-term unemployment rate

Q1

Q2

Q3

Q4

Q1

2013

Q2

Q3

2014

Very long-term unemployment rate Eurostat, LFS

% of unemployed

% of labour force

Long term unemployment and very long term unemployment in active population (EU 28)

Integration performance

Share of unemployed who transition to employment

% of unemployed by duration

48,0

43,6 40,0

35,3

38,0 41,7

32,2

36,3 28,0

26,6

30,2

22,5

27,4 22,6

18,0

2010 (U) 2011 (U)

18,2 20,4 15,7

11,4

2012 (U)

10,2

8,0

<1 month

1-2 months

3-5 months

6-11 months

12-17 months

18-23 months

24-47 months

>4 years

Unemployment duration Eurostat, LFS 2013, experimental data

Large variation among Member States Transition rates from unemployment (2012) to employment (2013) by duration

Eurostat, LFS 2013, experimental data

Problem Insufficient focus

Inadequate support to the long term unemployed

•

Low coverage of active measures among long term unemployed (4% HR -> 41% AT)

•

Diminishing spending per capita during crisis

•

Strengthen link to demand: Stronger links to employers and primary labour market, design of hiring subsidies and related services

Problem - Discontinuity

Share of unemployed receiving labour market benefits or assistance by duration of unemployment % unemployed aged 25-64 receiving unempl benefits or assistance

50

40

30

20

10

0

0

6

12

18

24

30

36

42

Months of unemployment Eurostat, LFS 2013, self- declared

48

Problem - Integration

Insufficient coordination between delivery agents

•

Lack of continuity in individual assessment and action plan when responsibility for services shifts

•

Insufficient coordination between delivery agents (public employment services, municipalities, social services) – lack of clear obligations and mechanisms to cooperate

•

Inadequate enforcement of benefits conditionality / Lack of coherence / low level of incentive to work

New Initiative Objectives

General objective Provide a consistent framework for support to LTU integration into the labour market (national actions, Structural Funds, CSRs) Specific objectives 1. Increase the transition rates to employment of the long term unemployed and reduce the share of those falling into inactivity 2. Prevent the fall from LTU (one year) to very long term unemployment (two years or more) 3. Better align social benefits and activation measures, enhancing cooperation within Member States between relevant public or outsourced services delivering activation support, benefits and social services to LTU.

Options considered

• No policy change (continuation of European Semester process) • Council Recommendation on general measures to address LTU (Guidelines the integration policies) • Council Recommendation introducing the notion of Job integration offer (or individual activation offer)

Baseline scenario Current EU policy

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European Semester (19 Member States CSRs on LTU, activation, active measures)

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Communication on European Semester implementation (March 2015): need to strengthen the capacity of their Public Employment Services to fight long-term unemployment.

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March 2015 Employment Guidelines: • • •

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Comprehensive and mutually reinforcing strategies for LTU Provision of specific active support Better targeted and simplified social services

European Social Fund ''Access to Employment' and 'Active Inclusion' investment priorities (2014-2020)

Option : Broad Council Recommendation

Comprehensive and mutually reinforcing strategies • Individualised approach • individualised case management • tailored services

• Mutual commitments • rights and responsibilities • gradual approach

• Integrated approach • delivery partnerships • coordinated support offer

• Partnership with employers • enriching services for employers • awareness, incentives and post-placement support

Option : Targeted Council Recommendation

Job Integration Agreements Specific instrument for specific group of beneficiaries, additional to other ALMP offers • • • • •

Relevant activation offer Intensified point of intervention: between 12 and 24 months or after end of UB Personalised individualised approach Mutual commitments – activation, benefits, social services building on existing entitlements Single point of contact/ integration of services

Open questions on the timing of intervention, on identification of the target groups and on type of agreement (contract of part of IAP)

Next steps

• Public consultation open until 15/05 on Europa website

• Impact assessment analysing different options • Consultations of social partners • Consultations of relevant EU committees • Foreseen proposal:Summer 2015