The Commission’s latest so-called Country Specific Recommendations on strengthening the European economy show a slightly greater emphasis on social issues: a welcome (if inadequate) shift, in trade union eyes. This translates into more flexibility on budget deficits, and recognition of the importance of education and training, quality public services and access to affordable childcare.
The Commission also identifies some of the worst examples of workers’ exploitation, such as the abuse of fixed-term employment contracts in Poland (one of the highest proportions in the EU), the lack of social protection for self-employed people in the Netherlands, or the seven million ‘mini-jobs’ in Germany.
And yet the underlying narrative remains the same old story. Despite opposition from the European Trade Union Confederation (ETUC) and national unions, the message is still: austerity, structural reforms and deregulation.
This approach has already brought precarious jobs, lower wages, lack of investment and growing inequality. It has also undermined collective bargaining and social dialogue, even though these are known to be a vital ingredient in successful economies. The Commission is once more pushing for the decentralisation of bargaining and meddling in the role of employers and trade unions to agree on wages and working conditions.
It is not a lack of flexibility that is damaging EU labour markets, but the escalation in precarious work, fixed-term, involuntary part-time contracts and bogus self-employment. The recommendations fail to tackle the growing share of contracts of less than one month in France, for example, or job insecurity in Cyprus, where almost 95% of workers on temporary contracts want permanent employment – choosing instead to attack the cost of labour.
The ETUC was disappointed to see the Commission renewing its attack on higher minimum wages, especially in France and Portugal, and failing to encourage wage growth in countries where statutory minimum rates are still too low. Our research shows that in Italy and the Nordic countries, where minimum wages are set by collective agreement, there are fewer low-wage workers. We want a minimum wage of 60% of the national median, which would benefit 16% of EU workers, but so far only France and Luxembourg have achieved this.
According to research by the European Trade Union Institute (ETUI), the only countries where real wages have outstripped productivity gains by more than 2% since 2014 are Hungary and the Baltic States. By favouring sector or company-level rather than national productivity as the benchmark, the Commission risks increasing national wage inequalities.