Crisis response measures and EU financial support have helped to stem the adverse impacts of the slowdown on EU labour markets in 2009, says a European Commission report issued today. But these measures must be coherent with long-term employment reforms to prepare a successful exit from the crisis. The draft 'Joint Employment Report' will be discussed by employment and social affairs ministers in the Council in March 2010 and will contribute to the EU's new 2020 strategy for growth and jobs, due to be adopted by EU leaders in Spring 2010.

The Commission's draft Joint Employment Report presents an analysis of actions taken throughout the EU to preserve jobs and help those facing difficulties and sets out the challenges still lying ahead. Following the severe deterioration of labour markets in 2009 due to the economic downturn, unemployment is forecast to continue to grow next year in all EU countries, albeit at a slower pace. Although a gradual economic recovery is expected over the next two years, labour markets will take longer to respond. Certain groups have been hit particularly hard: young people, migrants and low-skilled workers.

Member States have considerably stepped up their employment and social policies under the three priorities of the EU Employment Strategy to provide an immediate stimulus to the economy and protect vulnerable groups from the impact of the crisis. Public employment services have been reinforced in many countries to cope with increased unemployment and EU financial support from the European Social Fund and the European Globalisation Fund has substantially helped Member States to finance anti-crisis actions.

Social protection systems have proven their effectiveness: automatic stabilisers have cushioned the immediate social impacts of the downturn, although to different degrees within the EU. Member States' capacity to meet rising demand for social security varies greatly, underscoring the need for strong policies to activate those out of work.

The way forward

The key challenge for the EU and Member States now is to set the right framework for a sustainable labour market recovery. Successful exit strategies that prepare both individuals and companies to meet structural challenges on the one hand, and efficient public policies to modernise labour markets on the other, are key to stimulating the creation of new and better jobs.

The report presented by the Commission will be discussed by EU Employment and Social Affairs Ministers at the Employment, Social Policy, Health and Consumers Council meeting on 8-9 March 2010 and serve as input to the Commission's and Member States' work on preparing the EU2020 strategy in time for the 2010 Spring European Council on 25 March. It follows the 2009 Employment in Europe report, which analyses in more detail recent trends in EU labour markets.