Committee on Employment and Social Affairs with MEP EUROPEAN PARLIAMENTARY WEEK 2026
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Li Andersson
In case of a large number of participants willing to speak, it might be possible that not everybody takes the floor, but we will do our best to make sure that as many as possible can speak. And that is why I ask you to keep your interventions to one and a half to two minutes, and there is a clock on the display showing the time. On your desk, you will find speaking cards with which you can indicate that you would like to take the floor. And should you wish to do so, please fill in a speaking card and hand it to the ushers. Members of this House, European Parliament, wishing to request the floor are kindly requested to simply raise your hands, as usual, to me and to the secretariat of the committee.
In general, we try to divide speaking time according to the following formula: two national parliamentarians followed by one member of the European Parliament, and so on. And we will adapt this formula according to the request to take the floor. So now, I would like to warmly welcome our first speaker, Mr. Mario Nava, who is the Director General for Employment, Social Affairs, and Inclusion. It is a great honor that you are here with us today to share your thinking and plans regarding EU policymakers in relation to competitiveness and a strong social Europe, a theme I know that you work on daily. So, please, the floor is yours.
Speaker 3
Thank you very much, dear chair, dear Lee, dear other chair, dear honorable members of the European Union National Parliament. We just heard Anita Dimitriou saying that we are at the crossroads. She referred to the crossroad between values, our values, and the values in which we believe, and the attack on them. But I think the same thing can be used here because when it comes to competitiveness, economy, the way we treat people, the integration between competitiveness and social inclusion is not particularly different. We know that the crux of the matter is that EU productivity growth has lagged behind the major economies in recent years, and that the growth of EU productivity increased only by 1.5 percentage points compared to nearly 10 percentage points in the US.
So, that is the crux of the matter. And as you said, dear Lee, sometimes we hear the temptation to say, "Well, there is a simple solution." Competitiveness and inclusion are intentions, and they cannot go together. We believe, like you, that it is exactly the opposite. So, I can be absolutely crystal clear.
The EU can be, at the same time, competitive and inclusive. Let me give you an extremely concrete example. Look at the European labor market. The European labor market twenty years ago was one of the luckiest ones, with a very high level of unemployment. Today, we have a very tight labor market.
We have very low unemployment. We have an increasing and growing participation rate. How did we achieve that? How did we increase the participation rate? By increasing the participation of those who were part of the societies but out of the labor market, and therefore by promoting inclusion.
This is a nonbanana result, which has completely changed the picture in the labor market in Europe and was achieved exactly because categories that were out, for example migrants, people with disabilities, female employment, all those categories have been reinforced. Measures have been found to encourage them to go back. Now, as you know, we published a Competitiveness Compass at the beginning of last year, 2025. And in the Competitiveness Compass, which looks across different sectors in the employment and social field, we said three things are crucial. One is promoting skills and quality jobs.
Two is better: coordinating policies at the European and national levels, and that's what we are doing here today. And three, supporting social investment and reforms through EU funds. And we need to talk, of course, about money. First, skills. Skills and quality jobs.
Skills, we have defined as a horizontal enabler of European competitiveness. Europe is short of natural resources. It's short in other types of natural wealth, but we do have an immense national wealth, which is the brain of our people. Plus, we have a system which is a very universal system of education. A very universal system of education has made the education level of Europeans one of the highest in the world, although it took a fall after COVID. The effort is really to keep it as high as possible.
Why does this matter? This matters a lot for competitiveness because, at the moment when we have a tight labor market, skills are no longer a private good but become a public good. Companies exchange people with one another. Companies take people from one another exactly because the labor market is tight, and therefore ensuring that everybody is well trained, upskilled, and reskilled is quite important. We have put forward, in the first hundred days of the Commission on March 25, a document called the Union of Skills that looks at basic skills, upskilling, the circulation of skills, and the attractiveness of Europe.
The attractiveness of Europe matters a lot. It can be reached through supply-side efforts, making sure more people come to the labor market, but we should never forget, as several call it, that we should also look at the demand side of the labor market, and that quality jobs play a role. If the jobs that are offered are not of great quality, if the remuneration is not good enough, and if the contracts are not good enough, then it becomes very difficult to increase the participation rate beyond the current level. We are now at a high participation rate in Europe. We are 76 percent.
We need to get to 78 by 2030. We will certainly be there, but confronted with the demographic decline, we need to make sure that more people enter the labor market and, therefore, that we are able to attract them. That's why quality jobs matter a lot. That's why, at the end of this year, we will publish a Quality Jobs Act, which is a new legislative proposal to ensure that workers' rights keep up with technological, economic, and societal changes. We will look at issues like the right to disconnect, artificial intelligence, and algorithmic management.
We will look at the issues of occupational safety and health, the issue of subcontracting, and also all the issues of implementation. Often, the biggest obstacle comes from incomplete implementation. Second, the reasons why you are here coordinating policies at the European and national levels. It's clear that we need better coordination. Better coordination can be ensured by the semester.
We have had, together with the work in this house, a major success in the last couple of years, which is that the 20 principles of the European Pillar of Social Rights have now been fully integrated into the European Semester through what we call the Social Scoreboard and the Social Convergence Framework. These would not have been possible without the effort of this house, and I want to formally thank the chair. The implementation of that on the ground will not be possible without the effort of the houses in Europe because once they are in the semester and they go down to member states, you need that. And finally, let me close with my third point, which is money. We need to speak about money because you can have the best policies in the world, the best people in the world, but without money, it's difficult to go anywhere. Social investment plays a key role in the ability to unlock the full competitive potential.
And this is exactly what the ESF Plus has done and what the ESF Plus does. We have had a 140,000,000,000 budget for the period of 2127, which clearly changed, in particular in the active labor market policy in the skilled sector and across Europe and the labor market. We have fostered resilience. We have facilitated the transition. We have reduced inequalities.
We support competitiveness. A new MFF is coming. In the new MFF, we'll have the national regional partnership plans. We will have the European Competitiveness Fund. It is important that the considerations they have been speaking about find their way there.
Let me conclude by saying that, as Anita Dimitrios said at the very beginning, we are at a crossroads. And at the crossroads, we must remain faithful to our values. Our social model is our best competitive advantage. Thank you.
Li Andersson
Thank you very much. I will move straight on to the next speaker, Mr. Wojciech Munzal. I hope I pronounced it right. Who is the vice chair of the Committee on Budget in the Czech Chamber of Deputies? So, please, Mr. Munzal, the floor is yours.
Speaker 4
Thank you for the floor. Thank you for the introduction. I'm very glad and honored to be here, but I will continue in my mother language because it is much easier for me.
Once again, good afternoon, ladies and gentlemen, and thank you for the opportunity to address you at this distinguished forum. I really like the title of this panel. No trade-off, and so on. I have heard the introductory remarks, and I may be a little more provocative and offer another point of view. And I might also touch on some other topics rather than those we have just heard about.
As an economist, I know that a strong social system can only be paid for by a prosperous society, and a prosperous society must be competitive. The lower the competitiveness here, the bigger the pressure on our social systems and the higher the number of people who will be dependent on the social system. Competitiveness and the resulting prosperity are prerequisites for a strong social society. Only a rich society can offer a strong social system, but it's good to take care of other things as well, such as the environment or defensiveness. No society became rich through regulation or free competition between companies.
Replacing natural competitiveness with artificial competitiveness, for example through the choice of projects for the competitiveness fund, is not a path to greater overall competitiveness of Europe, especially when based on incorrect criteria that are being discussed. That means that money will only go to selected regions, and differences in Europe will increase. Competitiveness must mean success in the market, not in the subsidy race. The Czech Republic is consistent. We support strengthening the free market by removing internal barriers and regulations, and I will mention three topics.
What we criticize in Europe are customs tariffs, which are enforced by other countries and reduce the possibilities for production by our companies. However, we have been complicating the internal market through our own regulations. The International Monetary Fund estimates that the barriers are at the level of 40% for goods and 100% for services, and I look forward to the next speaker. In the past, we have seen efforts to reduce regulations, such as various omnibus packages, but they were insufficient. If, in the long term, we burden employers with artificial administrative burdens and increased costs, it will mean lower productivity, lower effectiveness, fewer investments, and a lower number of jobs.
The second topic I would like to mention is the high prices of energy. Those are limiting both the increase in competitiveness of our companies as well as the living costs of our citizens, which are going up. And that means that their social position is getting worse. Energy prices in Europe have been increased artificially through the EU ETS system. Industry companies that need to employ people have been struggling with increased costs as a result of the EU ETS.
I will give you some specific examples from the Czech Republic. The Economic Chamber in the Czech Republic conducted a survey, and these are the results. 75% consider the system to be unjust. More than half of respondents, who directly fall under EU ETS one, say that the costs represent more than 10% of the operating cost. In 60% of companies, competitiveness has worsened, and 17% are considering moving their production abroad.
That would mean fewer jobs. The EU and Europe want to introduce a burden for further sectors, such as transport and housing, that will increase living costs not only for European households but also for companies and employers. And the result will be quite clear. A higher number of households will fall under the social system and will need urgent assistance. Companies, due to increased costs, will develop less and offer fewer jobs.
There will be bigger differences in the living standards among European countries, and that goes against the idea of a strong social Europe. And that's why the Czech Republic would like to postpone the system or ideally completely do away with it. In the existing system, we would like to reduce volatility because that affects the social policy of Europe on regulatory burden. And the third topic is the labor market. In Europe, we need a more flexible labor market.
We need to simplify procedures and increase flexibility. We need a less rigid labor market because they are not opposed to each other. As we often hear, they must live in natural symbiosis. And, again, an example from the Czech Republic. The unemployment rate in the Czech Republic is the second lowest in the EU.
In spite of that, the Czech parliament has adopted increased flexibility of labor law so that employers have better choices when it comes to employees and more freedom when it comes to redundancies. We have also supported mothers on maternity leave, made it possible for them to work while looking after their families, in order to support economic growth and labor productivity, and as a result, to make it possible for us to pay for our social system from our budget. Labor law is something that we see as a phenomenon where individual countries respond to their lower competitiveness not through liberalization of rules and their labor law, but also, unfortunately, very often, by decreasing the competitiveness of other member states because they would like to apply their regulation in all countries. But that's a path to an inflexible labor market, which weakens the social system in Europe. In our member states, we all have different starting points.
We have varied social systems, but that's something we all want. If we want to achieve a strong, resilient, and socially prosperous Europe, we need a prosperous economy in Europe. And it's time to step back in regulation so that we can jump forward in prosperity. Thank you for your attention.
Li Andersson
Thank you very much. And now we will hear from another member state, this time from Finland. And we have with us Mr. Aki Linden, member of the Finnish Finance Committee and the Social Affairs and Health Committee. So please, Mr. Linden, the floor is yours for the next 7 minutes.
Speaker 5
Thank you, dear Chairman, dear colleagues. I will speak about productivity and solidarity. I talk in my native language, so now I will change to Finnish. So.
Before, I worked as a member of the government. And for 40 years, I worked in the health industry. First of all, I was very much in the field where I was taking care of patients. And then, in the last 20 years, I've been working for some of the largest hospitals in our country within management. In the public health care sector, productivity was always something very important for us, but solidarity was as well.
These are two components, and some people believe that they cannot be combined, but that's not true. I would like to prove my point by giving you some examples. First of all, you have to define certain principles. I make a clear distinction between two principles: productivity and efficiency or effectiveness. Productivity, for me, means or describes the connection between what you've got and what you produce.
How many goods and services do you produce based on the resources at your disposal? For example, how many vaccinations does a nurse carry out during their workday? But if we talk about efficiency or effectiveness, we talk about what we could have done compared to the results. So, we look at what actually happens using the resources at our disposal and how we could, for example, stop a serious illness from spreading or how we were able to make sure that a patient could regain their sight or mobility, etc. So, when we talk about efficiency or effectiveness, we have the idea of productivity as well as the impact that one could have had.
So, what about the aspect of solidarity, though? For me, it's actually all the same issue. It's an issue of having fewer illegal treatments, more equitable treatments, or taking into account every single person's social rights. So I would like to point out that a citizen who is in good health and has the education they need is the most important factor for competitiveness, both for them as an employer, for their employees, and for society as well. What connection do we see between solidarity and productivity?
Once again, I would like to answer that question by giving an example. And staying in the public health care sector, mammography is, for example, a good way to make sure that we can prevent breast cancer, increase access to the needed health care, and increase people's life expectancy. From a certain age, it's an examination that's done every two years and for free, whereas before, you had to pay €50 per examination. So, with €1,000,000, one could carry out 20,000 mammographies. When we're able to put into place a productivity system and bring this price down to €40 per examination, for example, we can increase the number of examinations carried out.
It was 5,000 more examinations. So, women's health and life expectancy have increased. And you can imagine what happened after the coronavirus pandemic, what happened with the prices of vaccinations. It's often said that inefficiency can lead to illness and death. So let me talk about this issue once again, using the example of vaccinations.
A vaccination can be very effective, but if it is also very expensive, it might not be so useful. Let me make a direct connection to the idea of public service management systems. When you increase productivity, that can increase national wealth as well, which can also lead to an increase in the aspect of solidarity. That can be done. It won't happen spontaneously or naturally.
You have to increase productivity, reap the benefits afterwards, which can then be distributed among more people. If it's not shared out equitably, then that would increase the differences. But if we work with the health care sector, we can save money and decide how to use that money to offer other services, for example, or offer tax rebates as well for certain people. The richest ones in areas and in times of economic downturn can make it difficult to come up with an equitable distribution of these goods and services. So, the questions are quite complex, is what I would like to say.
If we want to make sure that we are productive for the sake of being productive, that can actually have a negative impact on workers who have lower incomes. Companies or factories might end up closing. There are services that have been lost. That's what we call the creative destruction of the economy. Those are rather extreme economic policies, and I'm aware of this, which is the reason why, as a conclusion, I would like to emphasize the role that innovation could have in improving productivity.
In the last few years, we've seen that some new ideas have been circulating about the role of innovation. When we develop a new product or service that offers a better response to our needs, or when we take something that existed before and make it less expensive, that increases productivity. So, there's a great challenge here. We need to improve people's lives. We have to act against climate change, deal with the environmental crisis going on, increase productivity, and make sure that we work ever more with solidarity as well as with greater innovation.
Thank you.
Li Andersson
Thank you very much. And now, I would finally like to give the floor to Mr. James John, director of the International Monetary Fund European offices. Previously, he also served as an adviser to IMF managing directors Christine Lagarde and Kristalina Georgieva, and was head of the European department focusing on the Euro area. He has also served as an economist at the US Treasury and as a legislative assistant in the US Congress. So, Mr. John, the floor is yours for the next 7 minutes, please.
Speaker 7
Good afternoon, and thank you. It's a pleasure to be with all of you today. As you mentioned, I started my career in my national congress, so it's always nice to be speaking and meeting with parliamentarians. So I have some slides which you'll see up on the screens there. In my presentation today, I will outline some key findings of recent IMF staff analysis about the kinds of policy packages that can help Europe achieve faster economic growth and ensure stable public finances, which can help sustain Europe's social model.
Speaker 7
So, the European economy has weathered a series of major crises in recent years. As you know, these include the pandemic and the war in Ukraine, and it's come through with growth recovering and really demonstrating some resilience. And while Europe continues to grow, the pace of growth is mediocre and has been below that of the United States in recent years, as some other speakers noted. In our latest forecast, the gap between European and American living standards is set to continue. And so, Europe faces a dual problem: low potential growth and a weak fiscal position.
Now, first, the mediocre growth reflects weak productivity, a point picked up by a number of previous speakers, and this is due to persistent structural challenges that constrain Europe's economic dynamism. This has a meaningful impact on living standards and explains most of the gap with the United States. Second, the region faces a difficult fiscal landscape, with high debt levels in many countries and rising spending pressures. And the fiscal challenges are worsening, as new demands on public spending have emerged in defense and energy security, adding to growing pension and health care costs from aging. So, you can see on the right chart, we estimate on average a 4.5% increase in cost as a percentage of GDP by 2040 for advanced European economies and 5.5% for what we refer to as SESI economies, Central Eastern and Southeastern European economies.
If left unchecked, spending pressures will put public debt on an unsustainable, explosive path. The chart illustrates this point by showing the debt trajectory under unchanged policies. This is the red line. That is if the debt ratio increases because the additional spending pressures add to deficit levels, and this effect grows over time. A preferable path is represented by the blue line, which shows the sustainable debt trajectory.
There are, of course, many possible sustainable debt paths. So, in our paper, we define the reference path based on several assumptions, which I'll explain. A key assumption is the choice of the debt anchor, which is the long-term debt target. We estimate optimal debt anchors for individual countries using tools developed by the IMF's Fiscal Affairs Department and find an average anchor of 90% of GDP for the region. This is on average again.
Let me stress this. High-debt countries with debt above 90% of GDP are assumed to target debt stabilization over the next five years and then put debt on a declining path, as in the EU's fiscal framework. Then we pose the question: is there a combination of policy tools that can bring down the debt trajectory from the explosive red line to the sustainable blue line? We consider policy packages based on three pillars. The first pillar is structural reforms that have three main functions.
So, this is to increase the government's ability to handle spending pressures by boosting economic growth. So, these are product market reforms, labor market reforms, and steps to strengthen the single market. Again, some points I appreciate that other speakers have mentioned. Second, tackle some spending pressures, for example, through pension reforms. And third, alleviate the burden falling on national budgets, for example, through increased centralization of spending at the EU level to realize efficiency gains, savings, and catalyze private investment.
So, I think there has been a lot of discussion about competitiveness. Many of these reforms are exactly what will help improve European competitiveness. The second pillar consists of medium-term fiscal consolidation measures on both the revenue and spending sides. So, for revenue, this could be revenue administration, including addressing tax evasion, broadening the tax base by removing exemptions and loopholes, and improving spending efficiency. And I appreciate Mr. Linden's comments there.
And then the third pillar: if these reforms that boost growth and those that undertake fiscal consolidation are insufficient, then more radical fiscal measures could include reassessing the scope of public services and other government functions, potentially impacting the social contract. This is what we call a rethink of the role of the government. We recognize that there may be some overlap among these pillars, and there is obviously some judgment involved. Let me highlight a few results. The first question we ask is: can structural reforms alleviate the fiscal challenge, and by how much?
We select a range of structural reforms based on their macroeconomic relevance, so we pick the highest-impact reforms in each country, as well as those with available studies quantifying their effects. We put all these reforms into our debt dynamics equations and find that the reforms would significantly reduce the strain on national budgets. Again, this helps make it easier to sustain social safety nets. In particular, a moderate package of reforms implemented over the next five years and paying dividends over 2030 to 2040 would bring the debt trajectory of the average country one-third of the way toward the reference debt trajectory. This is the yellow line in the chart above.
Early and ambitious domestic structural reforms, including business regulation, labor markets, and government governance, should be a central pillar of an agenda that aims to boost productivity. These efforts should be front-loaded, as this would facilitate adjustment to EU-level reforms as well as generate large gains in and of themselves. Deepening the EU single market can also deliver large benefits by allowing companies to increase scale, expand their customer base, and access talent and capital. Harmonizing regulations, opening up protected sectors, advancing the Capital Markets Union, and addressing barriers to labor mobility are among the key priorities. A voluntary 28th regime would also reduce legal uncertainties and help firms scale up across the region by giving them one rulebook.
Then, we ask a second question. How much medium-term fiscal consolidation is needed to achieve the reference debt path? The answer depends on the ambition of the structural reforms. More ambitious reforms have a larger fiscal impact because of the additional increase in GDP, which boosts revenue and leads to a greater reduction in spending pressures. Together, this lowers the amount of required consolidation.
The isoquant shows different combinations of reform ambition and consolidation size in the average European country. If there is no reform, the required consolidation would be around 5% of GDP cumulatively over five years, or about 1% per year. This is the first diamond on the left. Then, as countries implement reforms, the fiscal consolidation needs diminish. Our paper assumes that countries implement a moderate reform package.
In this case, the required fiscal consolidation would entail an improvement of the fiscal balance in cyclically adjusted terms by about 3.5% of GDP over five years. Now, a more ambitious set of reforms would further reduce the consolidation needs along the blue curve. In practice, for the vast majority of countries, both reforms and consolidation will be needed to ensure debt sustainability. For countries that already have high levels of debt, reforms and conventional fiscal consolidation measures likely will not be enough to bring debt down to a more sustainable level. Indeed, for one quarter of the countries in Europe, the size of the required consolidation would surpass what has been feasible in the past, even after implementing a moderate package of structural reforms.
In these countries, a discussion on the scope and sustainability of the European model seems unavoidable. It is a very complex and sensitive discussion, but the savings created by rebalancing the public-private split are potentially significant in Europe. To illustrate this point, we have collected public and private financing data by country in health, education, pensions, infrastructure, and climate, and we compute the savings generated if public financing shares that are above the OECD average were aligned with the OECD average. We find that this could generate fiscal savings of close to 3% of GDP per year for the average European country. So let me conclude with four key messages from our note. First, there is no silver bullet.
A multipronged strategy is best, leveraging all policy tools at national and regional levels. While some measures, such as mobilizing private finance and joint EU financing, are sometimes presented as game changers, our analysis suggests that no single measure can close the financing gap alone. Second, reforms and fiscal policy should be combined. Both are necessary in most European countries, and both entail adjustments that could be politically costly, requiring governments to balance and select the best combination. The greater the progress on reforms, the less costly the task of fiscal consolidation will be.
Third, we anticipate difficult choices regarding the role of government in the coming decade. Even with bold reforms and fiscal discipline, financing gaps are likely to persist, especially in high-debt countries. This will leave little choice but to adapt socioeconomic models and make deeper reprioritization decisions. And my final point: I realize I'm a little over time. Apologies.
Fourth, extensive public consultation will be key. It is important to initiate a public discussion about the scale of the problem, the policy response, and the consequences of inaction. Communication has been a component of successful large policy adjustments in the past. Thank you very much for your attention.
Li Andersson
Thank you very much, and thank you to all of our guest speakers. We now move on to the exchange of views among the members. Just a very short reminder of the housekeeping points. We now have an established speakers list based on your requests, of interest for the floor. And in general, we try to divide the time in this way: to national parliamentarians, followed by one MEP.
Members of the European Parliament who wish to speak, please raise your hands or your cards, as you normally do, to me and the secretariat. National parliamentarians are invited to fill in the speaking cards. And I ask you to limit your interventions to one and a half minutes; then we should have time for all who have requested the floor. And I will start with Mr. Clement from Luxembourg.
Speaker 8
Thank you, chairs. I speak as a member of parliament from Luxembourg, but also as someone who has written code in the past and built companies before entering politics. So, the dual perspective has taught me something relevant to today's discussion. The supposed trade-off between competitiveness and social protection is a false binary rooted in outdated economic thinking. Social investment drives productivity, not the other way around.
And yet, when we look at the Commission's simplification agenda, the instinct has been to roll back sustainability and social reporting requirements in the name of competitiveness. We should be honest. Reducing the CSRD thresholds to 1,000 employees doesn't make Europe more competitive against the United States or China. What makes us competitive is our educated workforce, our social stability, and the trust that comes from strong institutions. Luxembourg, as a small open economy, understands this acutely.
Speaker 9
Our productivity depends entirely on attracting and retaining talent, and talent goes where the quality of life is high, where childcare works, and where social protection is real. So we need to invest in these areas, and invest we must. Finally, as national parliamentarians, our role is not just oversight. It is to ensure that the European Semester's social scoreboard, of which we have spoken too little today, carries the same political weight as its fiscal targets, of which we have spoken a lot. Thank you very much.
Speaker 11
Thank you, colleagues. I am a member of parliament, and I work actively on employment. I think European economies are really under pressure, given the geopolitical situation. The Italian government is trying to change things up and have more resilient systems. We have chosen to move from assistance to a much different approach.
Speaker 12
But what you need to have are policies that will activate the labor market with simplification, more modern procedures, and more flexible procedures so that we can boost skills and upskill and reskill. We must also try to strike a balance between supply and demand, as well as between work and private life, because that is what young people are asking for, including APO and other organizations. It's therefore important that we work with a pragmatic approach, striking a balance between simplification and red tape reduction, while also ensuring security and a stable situation for workers, particularly those who have atypical work patterns. We are revising the state security system so that things are better for workers and so that there is better cooperation between social security systems. Thank you.
Speaker 10
Chair, I'm here.
Glad that we're discussing this today. We're talking about productivity, prosperity, flexibility, and efficiency. Normally, we don't hear those words here in this Parliament. Often, social stability doesn't seem to be united with improving our competitiveness, but we've heard from our speakers, and it has become clear. But we're not doing enough when it comes to the US, and it seems as though the gap is growing.
Last week, in the MPO committee, there was a presentation from the parliament study department. This study said that Spain was the country which received the largest amount of EU funds, but it was being handed out in the form of subsidies. And Spain, nevertheless, has a high unemployment rate, the highest unemployment rate. And yet, we have a lot of unoccupied posts. That's the case, isn't it?
Now, you invest money, and sometimes that social spending is just used in the form of subsidies, but it leads to further impoverishment and further poverty because people aren't encouraged to work. We've also heard about flexibility today. We need to look at companies as allies because they are the ones creating jobs and wealth, but we have to make life easier for them. So, in that context, we have to ensure legal certainty. You know, we must not forget bureaucratic obstacles.
Another issue that has come up is the increase in energy prices. So, that's obviously linked to our decarbonization goals. Thank you.
Speaker 13
Chair, ladies and gentlemen. The EU is focused on cohesion. Cohesion between governments and between peoples, where people work and create prosperity. Cohesion between peoples is important, and we won't achieve that by just investing more in armament, as is planned under the MFF. Instead, we need a stable social economy, but a lot is focused on growth.
But labor rights are fading into the background. Now, we hear that the commission wants justice, but that is not what is focused on in its work programs. And there are no real social reforms. That is against the EU's main competence, which is to even out wealth inequalities. What is happening is that the underdeveloped regions are becoming even more underdeveloped.
There's too much focus on deregulation. Now, you might reduce red tape, and that might speed things up, but it will mean there's more pressure on labor standards. And who pays the price at the end of the day? Employees. So, what we're talking about here shouldn't be a goal in itself.
We need growth, but we also need to ensure that there is cohesion and fairness.
Speaker 14
Thank you very much. Next speaker is Missus Petrovic from Latvia. Good afternoon, dear chair colleagues. I will use the opportunity to speak in my Latvian language. Well.
Speaker 15
Functioning labor markets and a social protection system are the basis for a sustainable economy. It ensures equal opportunities, safe working environments, good lifelong learning skills, and also the improvement of employment conditions. Economic growth is furthered by investments in productivity and skills, and social policy, on the other hand, uses opportunities for the entire population and provides protection in situations when it is necessary. And therefore, a holistic approach is necessary, which includes various policy areas. Competitiveness goes hand in hand with productivity and also with a higher quality workforce and labor market.
Speaker 16
Competitiveness can be viewed from various angles. The approach that fosters high life quality, and not only higher wages, is the one that corresponds to the social pillar of Europe, the principles of the social pillar. Also, it's important to highlight the quality of employment opportunities. Also, the quality of social partners, their meaningful involvement in various policy actions that foster the protection of various interests, and also take into account the fluctuations in labor markets and sustainable development. Thank you.
Speaker 17
Chair, je parle en français, ma langue maternelle. I'm a member of the European Parliament, and I hail from Belgium. But can we go back to the infamous Dragi report and the new dogma of this term, which is competitiveness? If you look at the Draggy report and the commission's text, no one ever nails down what they mean by competitiveness. There's no definition, so everyone can twist it as they see fit.
So, competitiveness for a business is about gaining market share. But if you look at competitiveness for a region like Europe or a country, it is about gaining new activities, generating revenue, ensuring a high standard of living, and also focusing on infrastructure, education, and macroeconomic stability. Macroeconomic stability. It was very interesting to hear from the IMF and its representative. But perhaps we should hear about why we have different levels of indebtedness because of the crises we have gone through.
Now, basically, there's no definition of competitiveness, but the only part of competitiveness that people are talking about is simplification/deregulation, particularly social and environmental deregulation. Another issue of our times is that there is a trade-off between competitiveness and cohesion policies, including social cohesion. That is extremely problematic because social cohesion and cohesion policy are from the very bedrock of the EU. And I haven't got much time to speak about this subject, but I'll just say that the direction we're heading in is worrying. Thank you.
Microphone.
Sorry, you need to use the microphone.
Speaker 19
Thank you very much. As we've heard from previous speakers, we are in a fast-changing world, and the EU must stand up for itself. There are many challenges that we have to grapple with. We need to be more innovative when it comes to production, health, and the world of work. We need to create more value.
Speaker 18
Value creation should happen at home. It shouldn't just be a company or a factory that sets up shop, and then that value goes elsewhere. Now we're moving towards a two-speed EU, but we need to counter that and deal with it. And then we see that phenomenon when we're talking about wages. Look.
Compare wages in Western Europe with those in Eastern Europe. Prices are more or less the same, but there is a major salary gap between the East and the West.
And.
Speaker 18
Then, look at demographics. Look at the average age of the people. Some 30% of Hungarian men don't even reach retirement age, which is something we have to deal with.
From Greece.
Speaker 20
Thank you. I would like to wish all the best to the Cyprus Presidency. This debate on the competitiveness of Europe. There's no tension between social protection and competitiveness. These are two sides of the same thing.
Speaker 21
Citizens do not want to know about technical standards. What they ask is: can we live with certainty and plan our future? That is the dilemma. That's the crucial issue. Competitiveness can't lead to fewer rights, more insecurity, longer working hours, and being tired every day.
Europe isn't going to be more competitive if it's cheaper, but if it produces more, is more innovative, and has greater certainty. When people feel safer and more certain, then there will be investment in people's abilities. When families feel safe, they consume more. When businesses work with safe, certain, stable rules, they create employment. Productivity goes up, and growth cannot leave people behind. We need a strong social Europe, and that is essential for healthy growth.
Thank you.
Speaker 23
Thank you. Greece is a typical example of competitiveness, which cannot be built by cutting jobs. We've seen longer working days, lots of young people who have had to leave the country, and that has led to higher unemployment. And if we want things to be healthier, we need more social cohesion, less dumping, good salaries, social protection, and policies that allow people to stay in their country. And we need to solve the demographic problem.
Speaker 22
Housing, social policy, and we also need true social cohesion. Yes, to development. Yes to social justice, fair jobs. And Europe is based on social cohesion, but not a two-speed Europe.
Li Andersson
Thank you very much. And the next speaker is Mr. Kukuratis from Lithuania.
Speaker 24
Thank you, Chair, dear colleagues. There is no trade-off between competitiveness and a strong social Europe. The real trade-off is between short-term savings and long-term resilience. From Lithuania's perspective, this is not theoretical, as an increasingly open economy in the US faces external border military insecurity in the region. We know that insecurity, inequality, regional decline, and immigration not only affect competitiveness but also resilience.
Speaker 26
It is very clear. When security declines, talent leaves. So, how do we generate growth and, at the same time, support social policy? First, invest in people. Early education, lifelong learning, and reskilling increase productivity and attract investment.
Speaker 24
Second, reducing inequality and regional disparities. Cohesion policy, childcare, and inclusion measures expand labor market participation and strengthen the tax base. Third, protecting workers during transitions. The green and digital transition must be just. Fair wages, collective bargaining, and active labor market policies.
Policies provide security. The second question is how to balance economic, budgetary, and social rules. Fiscal responsibility is essential, but cutting educational and social investment is harmful. Allocating only 14% of the MFF to social policy is insufficient in light of the scale of geopolitical, demographic, and labor market challenges we all are facing. Dear colleagues, in Lithuania, over the past decades, we have clear evidence that competitiveness and social investment reinforce each other.
Annual minimum wage increases, support for families, and investment in regions have gone hand in hand with growth and rising productivity. Without social justice, Europe cannot compete. Without economic strength, it cannot protect its people. We need both, and we must continue designing policies that connect them. Thank you.
Speaker 28
Thank you. Next speaker is Sir Vital from Portugal. Thank you very much. My apologies. This is Vital.
Speaker 27
Colleagues, in this debate on stability, economic governance, and coordination, we always hear that there is apparently a trade-off between economic competitiveness and social rights. This narrative, this discourse, is wrong, and it has led to policies that don't work. So, let's be clear. Structural reforms cannot lead us to a budgetary tightrope. We need to look at policies that actually work.
We need to create jobs while also ensuring that our social security systems can be maintained. We can't be held hostage in Europe, where we just have a focus on the individual. If we have support, it needs to be a temporary kind of support, and it shouldn't be up to the middle class and businesses to pay for those subsidies. And if we want to have a strong social state, it doesn't mean giving that money out in handfuls. Now, as I've said, we don't need to talk about a trade-off.
We must have responsible economic governance. So that should be the European compromise which emerges from this parliamentary week.
Li Andersson
Thank you. And the next speaker is Mr. Christidis from Greece. Mr. Christidis.
Thank you.
Thank you.
Speaker 29
Chairs, ladies and gentlemen, as chair of the Social Affairs Committee of the European Parliament, I would like to point out that the dilemma of competitiveness versus social security is a false dilemma. There are two sides to the same thing. Strong economy and growth need to go hand in hand with social cohesion. The guaranteed minimum salary is a mechanism for integrating all workers. Minimum wage is calculated in line with inflation and growth in annual GDP.
Our goal for 2030 is to reduce poverty by 7.3% and increase employment to 71%. And at the same time, we're aware that competitive economies need access to housing. So, in the European plan, we are pleased to see it, but we also need to reform state aid rules. We need to work for balanced, modern employment that will help make businesses more accessible. The competitiveness fund cannot work against social cohesion. We need a one-speed Europe, not a two-speed Europe.
Li Andersson
Thank you very much, and thank you to all of you who have participated in this debate. We will now give the floor to our guest speakers for the challenging task of two-minute closing remarks to each guest speaker. I will give them in the same order as you intervene at the start. So, starting with Mr. Mariano.
Speaker 3
Many thanks, first of all, for the very good comments. I cannot comment on all, but I'll choose a few. One, which I thought was very good by Clement of Luxembourg, was the importance of the European Semester Social Scoreboard, and what he said about the fact that it needs to be put by us also mentally on an equal footing with the fiscal one. Legislation has done it. There are two pillars of how this semester is organized.
I think we need to put the emphasis on that. Another very good comment that I'd like to highlight, which came from three or four of you, is the importance of the active labor market policy and the fact that we do have something on which to build, which is the very good level of the labor market today. We have some idiosyncratic issues here and there, but generally, the labor market is tighter and stronger. This comes from the policies of the active labor market. And then, I would say I want to comment on the social aspects. It has been made, for example, I noticed, Honorable Member Christidis and many others, the importance of having the social aspects, which are in the treaty, and the transformation, if you pardon me the word, of the social aspect from the treaty through the effective economic policy that we are doing now.
Mr. Buchner from Germany, for example, highlighted how growth and cohesion in Europe grow together. And they go together exactly because it is through a better qualified labor force, which often comes from cohesion and inclusion, that we can do it. So, these are the main comments I'll take.
Speaker 4
It is not easy to sum up everything in two minutes, and I'm very happy that many of the speakers emphasized, as I did in my introduction, that there is a need for economic growth. And what's most important is that there can't be a trade-off between competitiveness and social Europe because a strong social Europe and our social systems are based on prosperity and economic growth, and we can't achieve economic growth without prosperity. And a final word, something I didn't mention at the beginning but should be mentioned: we are beginning to see forces in Europe that are moving away from the main idea, which is free movement. And perhaps that's caused by overregulation by the EU, which interferes with the decision-making powers of national states and our legislation. And if Europe tries to achieve too many priorities, if it has too many objectives, there is a chance that it will run out of breath and will not achieve any of its objectives.
That's why the main objective must be to ensure prosperity and economic growth, which can be the basis for further priorities. Thank you.
Speaker 5
Thank you, Chair. In this debate, we've heard quite a lot of appropriate points. And I think everything is saying similar things, which is that we need to strengthen dialogue between various stakeholders in the labor market: employers, employees, and also people who aren't working at the moment. The social dimension is particularly important, as is economic growth. And it is product services, so that means we need competitiveness, a functioning market, and success for the best innovation, and that's directly linked to the society that underpins this.
And I'd like to return to a point that hasn't been dealt with so far but is linked to my experience. Now, the issue of mental health has grown over the last few years across Europe, particularly among young people, more among women than men. And a lot of this is linked to climate change, geopolitical issues, and the coronavirus pandemic. Now, I'm not going to go into the most serious mental health issues, but what I'm talking about is depression and malaise, which affect a lot of people and interrupt people's studies. And that means that there is a real issue for people who can't work.
Miss John, two minutes.
Speaker 7
Great. I thank you for the many valuable points. I think we've all heard clearly that there is no trade-off, and I would like to agree with that argument. And I think some good examples are strong education and health systems, which are really important for a strong economy. Now stronger productivity makes it easier to maintain a robust social model, and that's one of the key points I hope people take away.
And this is not about working more, but about working more efficiently. And the key to achieving this objective is action at both the EU and national levels. Reforms at both levels are needed. I would really like to emphasize a stronger single market. This gives companies an incentive and the ability to invest, scale up, and hire workers.
It also allows workers to use their skills most effectively and to find the best job across the EU. I just want to note that it also enhances European resilience at a time when you face an extremely challenging external environment. Let me just say quickly a few words also about the MFF, the EU budget. This can help support higher productivity in the European social model. We have advocated very strongly for doubling spending on European public goods.
So, this could include aspects such as cross-border infrastructure, including in the areas of energy, research, and innovation. If these types of spending are done at the European level, it is more efficient and can yield savings for countries, making it easier to sustain social models while achieving higher productivity that reinforces growth and revenue. A well-designed MFF can also incentivize the national reforms that I've discussed, which will enhance productivity, growth, and revenue. And again, this comes back to sustaining social models at a time when you face a lot of spending pressures. Thank you very much.
Li Andersson
Thank you very much, also on my behalf, and I think the no trade-off is a good summary of the debate that we have had. And I guess our shared challenge, both working on the national level and European level, is, of course, how we make sure that this is also reflected in the legislative work that we do. In the committee, we sincerely hope that this will also show in the forthcoming initiatives of the commission, such as those related to the Competitiveness Compass, the Green Industrial Deal, the Union of Skills, the Quality Jobs Roadmap, and, of course, also in the new MFF. In the committee, we will continue working on initiatives that further shape the way towards the objective that empowering and protecting people is not only a moral imperative, but also good economic policy. So now I will give the floor to my co-chair to give his final closing remarks.
Speaker 2
It's great you've taken part in this constructive dialogue, and the debate shows that competitiveness and social Europe go hand in hand in terms of goals, and they need to be regarded as mutually reinforcing in terms of priorities. Not that we need to choose between social justice and growth, but we can achieve both at the same time to help our society and to help employment. In terms of the new MFF, the priorities need to cover the needs and implement them. The EU needs to be competitive, but what's particularly important is that it needs to be a champion of social justice so that there is a proper balance, which is seen as essential for a better future. Thank you.
Li Andersson
Thank you. And now we will have a break for 10 minutes. So, we continue here at 5:00. Thank you.
On time.
I don't know.
Thank you.
Speaker 2
Madam Chair, members of the European Parliament and of National Parliaments, distinguished guests, colleagues, I would like to welcome you to the second session here of the Committee on Employment and Social Affairs, dedicated to fair and competitive labor markets in the context of the twin transition. We had a previous session where we focused on competitiveness, and now we are called upon to highlight its complementary dimension: fairness in the twin transition. Europe's green and digital transitions must not only strengthen our economies but also ensure that our societies are fairer. This twin transition is reshaping labor markets at an unprecedented pace, creating new opportunities in clean industries, digital services, and innovation driven by artificial intelligence. Yet, at the same time, it's generating precarious forms of work, shortages of skilled labor, skill mismatches, as well as restructuring pressure in traditional sectors.
A competitive labor market is one that must ensure fair salaries as well as opportunities for growth for employees to adapt to the new demands of the labor market. And these two objectives are not contradictory, as we pointed out in our previous session, but rather they reinforce one another. So, the questions before us are crucial. First of all, how are we going to be able to promote worker-centered flexibility while at the same time ensuring universal labor protection, including for new forms of employment? Secondly, how are we going to address labor shortages without lowering labor standards?
Also, how can we make sure that no region and no worker are left behind? So let's take all of these, keep all these ideas in mind, and I hope that we have a constructive dialogue together. I would like to give the floor back to Miss Lea Anderson, my co-chair. Thank you. Go ahead.
Li Andersson
Chair Kafka Elias, dear members of national parliaments and European parliaments. In the previous session, we focused on competitiveness and the social agenda, and now we are focusing more specifically on the twin transitions. So here, I would like to emphasize the justness of the transitions. In our committee, we have emphasized throughout the years that the green and digital transitions must be just transitions, meaning that, of course, we want our industrial strategy to create jobs, but we also want those jobs to be decent jobs. Our fiscal and economic governance must leave space for social investment, and we have just voted in the parliament on a legislative own-initiative report calling to establish a union framework of policy measures that can be put into practice in regions affected by the green and digital transitions, with the aim of ensuring a socially fair and inclusive transition and the creation and protection of quality jobs, including simplified access to the Just Transition Fund.
So, in this context, I'm hoping to hear a lot of good ideas and examples on how to generate fair and productive labor markets, how to address labor shortages, and, at the same time, create quality good jobs. Thank you very much.
Speaker 2
Thank you very much, Miss Anderson. So before we give the floor to our speakers, I would like to repeat what the procedure is for taking the floor. It'll be just as in the previous session. If you want to speak or take the floor, then you can use your speaking cards, just as we did in the previous session. I'd like to move on to our presentations now.
I'd like to give the floor, first of all, to Mario Nava, who is the Director General for Employment, Social Affairs, and Inclusion of the European Commission, to talk to us about the most recent updates concerning European policies related to the labor market within the framework of this double transition. I give you the floor for 7 minutes, sir.
Speaker 3
The Social Economy Forum is quite an important event, with more than 4,000 participants and more than 300 speakers, including Chair Anderson and many others who will be there. So today, I will necessarily, in seven minutes, focus only on three matters, but I really would like to invite each and every one of you to participate. It's also web-streamed next week, in March. Now, what I want to focus on for a just transition today are three things. One on skills, two on inclusive measures, and three, again, on funds and money.
On skills, the situation is that, as I said before, on the one hand, we will lose about 30,000,000 workers from now until 2050. So we lose more than 1,000,000 workers per year. Therefore, we are going to see a massive outflow of people out of the labor market. However, the needs will remain because people live longer, and therefore they will demand services, which means that today about 4 in 5 businesses struggle to find workers. And, of course, the struggle of the business to find workers hinders the ability to grow, innovate, and compete.
There is an excellent Eurofan publication, and Iwailo will be speaking after me. It shows where the labor shortage is present, and it shows that it's present at all skill levels. So it's really work that we need to do across the board. It's a work that needs to be done by both EU authorities and the private sector. For the EU authorities, I mentioned before, the union of skills was taken up by many of you in the intervention with the four big pillars: the basic skills, the upskilling, the skills portability, the circulation of the skills, and the attractiveness. In that respect, for those of you who will be able to watch or come to the forum next week, we will launch the board.
There is a board of skills foreseen in the Union of Skills, chaired by Ulva Johansson, the former European Commissioner. We will launch the board next week. So that is the first part, which is the public part. But there is also an important part, which is the private part. In 2020, we launched the European Skills Agenda and the Connected Pact for Skills. What is the Pact of Skills?
It's a pact, as the name says, that we have made with companies operating in Europe, including non-European companies operating in Europe, about 3,000 of them, as well as public authorities and education providers, in order to provide training to workers. The objective is to train about 25,000,000 workers by 2030. I believe these public and private efforts can really help to make sure that we have the skills that we need for the transition. The second point is on the inclusion measures. You said it, chair. It's important that it is socially fair, and no one is left behind.
This was very clearly emphasized in a recently adopted parliamentary resolution on just transition. And this was, if you want, the main trade of what we pushed forward at the recent COP in Brazil, where we had actually the point of this just transition made very clear. We have, at the same time, adopted a strategy for new work, like the Clean Industrial Deal or the new form of work. So the clean industrial deals have academies associated with them in order to be able to train people for this new type of job. The Clean Industrial Deal has announced that we are working on the first-ever European Fair Transition Observatory, of which, once again, EuroFund will be part.
The Fair Transition Observatory will provide relevant data, policies, and best practices in order to have a well-informed dialogue. And we plan to launch these in the coming week, possibly at the forum. And then I want to mention the Council recommendation on ensuring a fair transition to our climate neutrality that provides guidance. You are asking, both chairs, who are asking for concrete examples, and that's what we are trying to do: to give concrete guidance. And then finally, as I did before, once again, we need to be clear that for all of that, we need money.
We need that money to be invested into a just transition. To give you some order of magnitude, between 2021 and 2024. The European Social Fund Plus has allocated €3.8 billion for digital skills and €5.8 billion for green skills and green jobs. So the European transition mechanism will support training for another about €3,000,000,000. In that context, we have help coming from the Social Climate Fund. The Social Climate Fund is financed thanks to the ETS two future revenues.
And it will have the objective to make sure that truly no one is left behind in the transition, and those who are most affected by the rising energy and transport costs, because they spend a sizable amount of their income on energy and transport, will be compensated for that. I think it's particularly important that everybody is able to go for the new form of production, and therefore that the people who are most vulnerable, or the small and medium enterprises who are most vulnerable, are supported for that. And, of course, in the Recovery and Resilience Facility, you remember that 14 member states have included measures for training on green skills and on jobs. To conclude, the twin transitions are very rapidly and profoundly reshaping our labor market, and we must invest in three things: skills, fairness, and inclusion, and use EU and private funds very effectively. Thank you very much.
Thank you.
Speaker 2
Thank you very much, Mister Nava, for this introduction to our issue from the EU's perspective. So we're going to continue with our discussion with some national examples. We'll be hearing from two different representatives. The first person comes from Ireland. Mister Lola, the floor is yours, please.
Speaker 38
Andreas and Lee, thank you for your opening remarks. And, Lee, I hope you enjoyed your recent visit to Ireland with your colleagues in the Employment and Social Affairs Committee, and we indeed look forward to further visits from all the committees, hopefully during our presidency, which we assume following the reign of our colleagues from Cyprus in the latter part of the year. I'm grateful for the opportunity to speak to you all on this important subject here today. We are living in a time of rapid transformation with respect to digital advancement and the green transition, which presents opportunities and challenges alike for workers and enterprises across the EU. Meanwhile, this is taking place in the context, of course, of geopolitical instability and an ambitious plan to improve the competitiveness of EU member states.
I welcome this debate as it reflects the necessity to increase productivity while also protecting quality jobs for workers throughout the course of the twin transition. And how do we generate fair and productive labor markets? There are many ways in which the EU can generate fair and productive labor markets, including the introduction of stronger worker protections, fairer wages, enhanced collective bargaining, increased innovation, and the development of a flexible workforce through major skills initiatives. The Commission's renewed focus on quality jobs is particularly welcome in this regard, as sustainable and productive jobs must be the cornerstone of any plan to improve competitiveness while ensuring fair wages for workers. In the area of skills, Ireland aligns its skill development policy with the needs that are identified within the enterprise base.
The National Skills Council draws on labor market intelligence and forecast data on enterprise skills demand in order to advise on the allocation of resources. At present, we facilitate upskilling and reskilling in areas where there are labor shortages by providing free or subsidized programs supported through the National Training Fund. However, I believe that more can be done in this area. We simply must renew our focus on skills and develop a culture of lifelong learning to build on the flexibility and productivity of our labor market. We must also ensure that we can accurately forecast the skills that will be required in the future and make it easier for enterprises to access training to further develop the skills of their workforce.
Greater flexibility in the movement of EU workers is also needed to address critical skills gaps. In Ireland, insufficient housing and infrastructure placed constraints on competitiveness. While the flexible movement of labour throughout the EU to address skill shortages on infrastructure projects could prove beneficial, fairness to workers must also be at the forefront of our minds. Furthermore, attracting and retaining talent is essential for ensuring that Ireland and the EU remain competitive within the global economic environment. To work in Ireland, a non-EEA national, unless they are exempt, must hold a valid employment permit.
The Department of Enterprise, Tourism and Employment's Permits Unit administers the employment permit system in Ireland through the operation of the critical skills occupations list and the ineligible occupations list. Over the past number of years, there has been a significant rise in permits issued in Ireland. There has also been a significant expansion of the employment permit system, illustrating that a responsive and flexible permit system is needed to meet the needs of the labor market. Changes to the roles eligible for an employment permit are governed by the interdepartmental group on economic migration. This group consists of the lead policy departments relevant to the area of economic activity and considers evidence-based public submissions, labor market intelligence, and lead department analysis.
The strong demand for employment permits indicates that the Irish economic model continues to rely, increasingly so, on attracting and retaining skills and jobs. And this is likely to become even more pressing given the current and prospective conditions within the labor market. In the area of remote working throughout the EU, we seek to modernize the ways in which we work and make jobs more attractive to international talent. Yet, remote working is something that has not yet been realized to the fullest extent in Ireland. I alluded earlier to the constraints of housing and a lack of transport infrastructure, which has resulted in traffic congestion, long commutes, and increased carbon emissions.
Remote working can help address these issues, improve the quality of life of workers, and build a modern labor market. If we are truly to adopt modern methods of working, improve productivity, and reduce emissions, all while striving towards a just society for workers, we must provide opportunities for remote working where it is practical to do so. Indeed, without increasing the attraction of jobs by offering an improved work-life balance, it is difficult to conceive how we can attract the talent to address labor shortages in many sectors. Indeed, only last week, my own government opposed a bill that I introduced on remote working, despite the fact that it contained many safeguards for employers as well as employees. We simply have to see remote working as beneficial to productivity and the green transition, and not the opposite.
Also, people with disabilities, of whom Ireland has a poor record of employment, can avail themselves of remote working and improve their opportunity to enter the workforce. Finally, I would like to reiterate my thanks for the invitation to speak today, and I look forward to hearing more from colleagues on these important subjects. Thank you very much indeed.
Speaker 2
Thank you very much. Thank you very much for that interesting presentation. And now we're going to listen to the next national example, which will be coming from Malta. And will be presented by Mr. Jerome Karuana Sile, who is a member of the Economic and Financial Affairs Committee in the Parliament of Malta. Mister Sile, the floor is yours for 5 to 7 minutes.
Speaker 39
I will be speaking in my mother tongue, Maltese. First.
First of all, thank you for the opportunity to take part in this session. The twin transition, green and digital, is not simply a political framework. It is an economic transformation of the first order. It alters production structures, labor demand, capital allocation, and ultimately, the very organization of work. I would like to say that the key question before us is not whether we proceed, but how we proceed in a manner that is both just and competitive.
Europe has rightly framed the green transition as a new growth strategy. There's nothing wrong, but growth strategies only succeed when they are socially sustainable. Climate neutrality cannot be delivered in a context of widening inequality or eroding trust. This is crucial. As has been emphasized in discussions on just transition, access to essential services and the protection of vulnerable groups must be at the center of this transformation.
If the benefits and costs are not fairly distributed, the transition will lose its legitimacy. For Malta, this question is particularly acute. We are a small, open, and exposed economy. Our competitiveness is not a luxury. It is a necessity.
Our labor market has performed strongly in recent years, and this means that all adjustment depends on upskilling and productivity. The green and digital transitions are mutually reinforcing. Digital technologies can accelerate decarbonization, from energy efficiency systems to smart grids and data-driven transport solutions. At the same time, green innovation drives the demand for new digital capabilities. Yet, this synergy does not automatically translate into resilience.
It requires deliberate investment in skills, infrastructure, and institutions. I would like to say that one of the central insights emerging from research on resilient labor markets is that transitions succeed when they are supported by strong social dialogue and forward-looking policies. The just transition must not be reduced to compensation mechanisms after disruption. It must be anticipated beforehand. This means that we need to improve skills intelligence, strengthen vocational education, and involve social partners in curriculum design and employment strategies.
In Malta, we recognize that vocational education must not be treated as a secondary pathway. It must become the first choice for many young people, particularly in sectors linked to the green economy and essential services. Raising the attractiveness of these occupations is not merely a communication challenge. It is about ensuring that wages, working conditions, and career progression are credible and competitive. At the same time, we must be realistic about the structure of our economy.
Malta's prosperity depends heavily on services, tourism, logistics, manufacturing, and increasingly digital industries, among other things. Structural changes in working time, labor regulation, and environmental compliance must be assessed carefully against their productivity effects. As recent debate has shown, this will generate sectoral shifts. Some jobs will decline. Others will expand.
Active labor market policies must support job-to-job mobility. Lifelong learning must be mainstreamed. Adult participation in training remains insufficient across Europe. In a period where digital skills are fundamental rather than optional, this gap is a constraint on competitiveness. And I want to make myself clear here.
We need Europe to strengthen its productivity levels. Another dimension that deserves emphasis is access to essential services. The green transition will reshape energy pricing, housing, renovation, and transport systems. Without targeted support, these changes can exacerbate energy and transport poverty. The approach advocated in European discussions on the just transition, placing accessibility, affordability, and availability of services at the center, is therefore fundamental.
For a small island state like Malta, ensuring affordable energy and transport is not simply a social policy. It is core to economic viability. Therefore, investment must be viewed through a dual lens. On the one hand, it must enhance productivity and competitiveness. On the other hand, it must preserve social cohesion.
The social fund and similar instruments represent steps in the right direction, but their effectiveness will depend on national implementation and the ability to align funding with real labor market needs. In economic terms, this twin transition is a coordination problem. Firms must invest in new technologies. Workers must invest in new skills. Governments must provide the institutional framework that reduces uncertainty and shares risk.
If any of these stakeholders fail to adjust, the system will not perform. For Malta, this coordination challenge is amplified by scale. We cannot rely solely on domestic markets to absorb shocks. We must remain integrated into European value chains. We must ensure regulatory stability and administrative efficiency, and avoid measures that unintentionally weaken our competitive position without delivering measurable gains in productivity and sustainability.
There is also a broader philosophical point. A just transition is not about freezing economic structures. It is about enabling adaptation without exclusion. Labor markets are dynamic systems. They require flexibility, but also security.
The European social model has always sought to balance these elements. The twin transition tests that balance. In conclusion, Malta supports a twin transition that is economically rigorous and socially grounded. We believe that competitiveness and justice are not opposing objectives. They are mutually reinforcing.
A workforce that is skilled, secure, and confident is more productive. An economy that invests in innovation while safeguarding access to essential services is more resilient. Therefore, our task is to design policies that recognize this interdependence. The transition to 2050 will not be linear. It will require experimentation, evaluation, and adjustments.
But if we remain committed to evidence-based policymaking, strong social dialogue, and pragmatic flexibility, Europe can emerge from this transformation stronger, more competitive, and even more cohesive. Thank you.
Speaker 2
Thank you so much. That was really interesting, Mr. Caruana Silia. I'd now like to give the floor to our fourth speaker. That is Mr. Evalo Calfin is the executive director of Eurofound.
Before taking your position as director at Eurofound, from 2019, you were head of international relations in Sofia, and your focus was on migrants, their involvement in the labor market, and the need to update the social contract. Before that, you were Deputy Prime Minister of Bulgaria on two occasions, as well as being Foreign Affairs Minister and Labor and Social Affairs Minister. In the 2009-2014 period, you were a member of this very parliament, vice president of the budgets committee, and a rapporteur on the multi-annual financial framework 2014 to 2020. Mister Carfin, I give you the floor.
Speaker 40
Thank you very much, Mr. Chair, Madam Chair, esteemed members of the European Parliament and the National Parliament. I thank you very much for the invitation. For Eurofound, it is a long-standing agency with 50 years of experience working on collecting and analyzing data on the living and working conditions of European citizens. And, for this particular topic, I'll concentrate on two recent reports that we did. The one is on the impact of the twin transition on job creation and job destruction in the labor markets.
And the second one is an attempt, hopefully with your generous permission, to look at the labor market in a broader concept and try to link it to the other policies that we have both at European and national levels. Level. But, to start with, I would begin, again, not very traditionally, with the messages that I would like to share with you. I think they follow very nicely the intervention of the director general, Mario Nava, because the European policies, to a very large extent, address these issues. So, first, the twin transition is reshaping job numbers, job content, and job quality across sectors.
These changes are already happening, and they are happening to a large extent objectively. The question here is, are you going to react only to this, or are we going to use these changes that, anyway, happen in life objectively in order to increase well-being, competitiveness, etc., the goals that we have. Second, the net employment effects of the twin transition are already expected, and they are expected to remain positive, but the transaction costs and the transition costs are not equally distributed. And that's why the instruments that Mario Nava mentioned, in addressing the cost for the people, for the citizens who cannot afford to participate, are very important. Third, the skill shortages are already a binding constraint, and we see it in the business and the environment.
And, for sure, green and digital skills need to be prioritized in training at every policy level. Finally, fourth, job quality, social protection, and vital industrial relations are not add-ons. They are preconditions. They are not something nice to be. They're preconditions for a successful and sustainable transition.
Now I'll go into the reports that I mentioned. One of them is about job creation, and this is based on a database that you found maintained for about 20 years. It might be of interest to you. This is a database in the so-called European Restructuring Mechanism. So, these are the companies that are either destroying or creating new jobs, with the caveat that this is for larger companies.
So, for companies with 250 or more workers. So what we see from '21 to '24, except '24, is a net positive job creation on the European labor market by these larger companies. The decline in '24 is very much due to the automobile industry, and, by the way, it continues in '25 as well. But this is very much focused on a single, particular industry. Here, you'll see the job creation and job destruction, which will refer to the green transition.
Again, we see a very clear positive job creation with the green transitions. That is to say that the green transition creates jobs. Again, in '24, this is the same as for the previous one: the automobile industry, and there are different issues. I would say not only the greening and the requirements play a role. The next one is the energy transition because there were many fears that the energy transition to cleaner energy is going to destroy many jobs.
In fact, we see the positive, the opposite. Actually, the energy transition is creating more jobs in the sectors that are related to green energies than destroying. Next one is the digitalization impact on job creation and job destruction. As you see, throughout the period, job creation resulting from digital advancement is much higher than job destruction. And we speak about changing tasks.
I mean, jobs remain. Very few are destroyed. But many new jobs are created. The thing is that the tasks are changing very rapidly, and this is where the need for upskilling and for internalizing this development are very important. Next, you would see the sectors that are mostly affected by the twin transition.
As you see, mostly from the green transition, this is electricity, water, waste, mining industry, and construction, of course, not very much a surprise. Construction, by the way, is positively affected because you have plenty of installation, etc., that are linked to the green transition. The digital transition is very strong in reforming information, computing, financial, and insurance sectors. Retail, here we state media, etc. Next one shows the countries per continent.
In which country is the job recreational destruction highly explained with the digital and green transition? And we see that in some countries, it goes up to more than 50%. But in some others, the green and digital transition could go only for one fault, only of the changes in employment and in environment. So, as we see, there is no negative impact in terms of job creation and destruction from the green and digital transition. Now a few words about this more complex approach to the labor markets.
Labor markets are part of an economic model, which is, at the end, ultimately related to well-being, and you have a number of research and models based on that. The economic parameters give the means, the social are the ends—what we want to achieve—and the institutional developments show the ways in which this could be achieved. To this, our experiment, and we recently published a report on that, we add the impact of the digital and environmental processes, and social cohesion and trust because this is an enabler. If you want to enable a policy, you need to have social support and social trust, and I shouldn't talk about this to elected representatives. I think you know it better than we do.
So what we see is that in generally existing models—economic, social, and institutional parameters—we add the environmental, digital, social cohesion, and trust. You have a number of European Union documents that are following separately these parameters. The economy is in the economic semester. You have the Pillar of Social Rights, and Mr. Nava mentioned that the institutional ones are also there. We have the fifth fit for 55 package, and they focus very much on particular parameters.
What we tried to do was to see how these parameters could be combined in terms of member states' performance, enacting all these different parameters. Here is the result for 2022. This is based on Eurostat's objective data. But what is more interesting are the developments between 2018 and 2022, where we divide the European Union member states into four groups, and you see that there are some changes. Some countries are improving, like Belgium, for example.
Some countries are going down, going back into development, and the largest is among them. So, this would eventually give you the possibility to see how labor markets are part of the different parameters of our whole well-being system. They're part of the economic parameters, including labor market participation, human capital investment, and human capital creation. With the social parameters, which include the working conditions, the institutional framework, and the social dialogue, I am very happy that you mentioned the social dialogue and the role of the social partners in this transition, of course, in the digital and environmental transition. So, we see that labor markets span across all these different parameters.
And I would very much encourage, when thinking about policies, to keep in mind that with single measures, you cannot solve a bigger issue and bigger task, such as the development of the labor market. Thank you very much. Thank you.
Speaker 2
Thank you so much for that presentation, Mister Galfan. Thank you for that comprehensive perspective you’ve provided on fair and competitive labor markets in the context of the twin transition. Now, I would like to give the floor to those who wish to comment or ask a question. So, the floor is open to members and MEPs. Each speaker has one minute and thirty seconds.
Please stick to the time limit, which will allow everyone who wishes to take the floor to do so. Start with Mr. Darius Ramislavicius from Lithuania.
Hello,
Speaker 41
Colleagues. The green and digital transitions change our economies. In this context, the labor market becomes a key factor for Europe's competitiveness. A fair and competitive labor market needs strong skills, quality jobs, and inclusive participation. People must have the right skills for the green and digital economy.
Speaker 42
We appreciate your initiatives like the Union of Skills and the Quality Jobs Roadmap, but success depends on close cooperation between employment services, education providers, and employers. In Lithuania, the population is aging, and the workforce is shrinking. Labor shortages are becoming a challenge. Therefore, increasing the participation of older workers, persons with disabilities, carers, and migrants is not only social policy; it is also economic policy. Access to care services and affordable housing also support participation in the labor markets.
The twin transition will create new jobs but will also replace others. Our systems must help people move quickly between sectors. Income supports, retraining, and personalized employment services are essential in such cases. Pressure on pensions, health care, and long-term care means we must modernize social protection systems. They must be sustainable and adequate.
The twin transition will only work if we invest in people, improve job quality, and support inclusion. And only then will the green and digital transition bring shared prosperity. Thank you.
Speaker 11
Colleagues, thank you very much. We really believe that the digital agenda needs to be the motor behind an equal market, ways of cutting red tape, and stopping social dumping, leading to the inclusion that we all want. The green digital transition starts with young people, and Italy believes in the need to properly safeguard all of this using the directive on interns. We need to make sure that internships are proper jobs. There is an obstacle; this is an obstacle to the legal framework, particularly in young people's lives.
We need to have proper equilibrium with true subsidiarity, and we believe that to overcome the demographic challenge and overcome poverty, we need to make sure that the next MFF invests in proper resources: in people, training, education, and qualifications, because everything we've heard talks about needing the right skills. In that context, we need to do a lot of work on that. Thank you.
Thank you.
Speaker 17
Thank you very much, Miss Solomons. Solomon's. Miss Solomons from the MEPs of the Parliament. Today, there's a triple transition: digital, green, and reindustrialization of Europe. We need that.
We've had summits on that. And if we're talking about Europe's strategic autonomy, then we will need to invest in our infrastructure and skills. In the committee and in the parliament, we voted on a report about what we want. We want a directive covering a just transition, ensuring it protects workers and guarantees a fair process. Because what is going to happen is that there will be restructurings, and workers will not have the skills they need.
Thus, we need to ensure that there is training for workers, and that they have it enshrined as a right. In that same report, we are calling for a specific fund under the MFF. Despite the fact that deregulation is the Commission's watchword, it's difficult to have new directives, but we want a directive on a just transition, and we want a directive to help those dealers who are dealing with AI and AI management in their workplace. We've drafted a report on that matter. We'd also like to have a directive on temperatures in extreme conditions because one in three workers will be working in very warm conditions.
Speaker 43
And we also want to focus on mental health and psychosocial disorders in the workplace. So, there is a whole array of projects that we are working on in our committee. The aim is to ensure that we have better jobs in Europe and that there is security as these transitions happen. I'm from Greece. Dear colleagues, the twin transition is the biggest challenge for the competitiveness of the European labor market that we face.
Speaker 29
Having said that, the transition cannot exclude anyone, and we, in Greece, are focusing on digital literacy. We are investing in training and education for our citizens when it comes to digital technology and AI. What's more, we are investing in one of the first AI factories in Europe. Connecting Europe is very important, particularly energy connection and energy interconnectors. In general, the EU needs to invest in its security of energy supply, building new infrastructure while ensuring that we have energy security.
What's more, we must comply with the 2030 goals on the environment while leaving no one behind. Our strategies will only be successful if we fully and correctly train our citizens. And in that way, we can create high-quality jobs. So our competitiveness depends on the knowledge and skills that all our workers need to be given the tools so that they can grow. Thank you very much.
Speaker 13
Mike Bruckner is from Germany now. Thank you, Chair. Ladies and gentlemen, the EU is focusing on competitiveness and bringing that together with social rights. But if we always focus on the market, there will be new inequalities. There's a lot of pressure to change, particularly in steel, the automotive sector, and the coal industry.
We're not talking about abstract innovation, but actual jobs and the entire future of whole regions. Underdeveloped regions cannot carry out the entire environmental transition on their own. Coal regions have moved away from coal, and they have received support to do that. And that has been successful. But if there are cuts to funds, how could regions like this successfully transition?
And this goes against the EU's main promise, which is to focus on territorial and social inequalities and to reduce them. Okay, to transform, but we mustn't leave whole regions behind. As the left, we think that we need to have more funding, particularly for social, environmental, and employment protection. Environment and industry need to be provided with support, but employees need support too. And the focus should not be on blind competitiveness.
Maria.
Speaker 23
And I'll give the floor to Maria Zakharia from Greece. Thank you very much, Chair. The twin transition, encompassing AI, is upending the labor market. It does create new growth opportunities. However, it's also leading to many job losses in several sectors.
We mustn't lose sight of the fact that society has funded this change through innovation programs and so on. Thus, we have to ask ourselves a question. To whom does AI belong? To whom does the data belong? Who is benefiting from all of this?
And how should this be given back to society? How do we ensure that wealth and power aren't just in the hands of a few? We need to ensure a fair transition that involves reskilling and social protection, but at the same time, there must be mechanisms to ensure that the added value produced goes back to society. We must act before it's too late and before we have mass unemployment. Thank you, Miss Zakaria.
Speaker 15
Colleagues, the quality of labor markets, including remuneration, working time, social security, and social protection, is an important factor for the long-term development of labor markets and the economy. In Latvia, we pay particular attention to regional cohesion, the equal rights of women and men in the labor markets, and also to structural skills such as STEM skills and digital skills. Those are especially important to strengthen our competitiveness. Also, professional higher education and adult education need to be constantly improved, and thus we try to integrate digitalization with education systems. We use the possibilities of digitalization to improve the skills of our labor market, and we pay particular attention to specialized profiles, so to speak.
Speaker 16
Also, pay particular attention to the least protected groups, for instance, persons with disabilities, senior citizens, those who are without jobs for a longer time, and also persons with low qualifications. Requalification, as well as the acquisition of additional skills, improves their position on the labor market and enhances the mobility of the labor force. And also, the social dialogue conflict between the trade unions and the employers is of quite high significance. Thank you.
Left.
Speaker 21
Carlos Cristidis. Colleagues. The twin transition is not just another technological approach. It is life-changing. It is uncharted waters.
So, we must be honest with ourselves. A study in Greece showed that someone working in the private sector, their salary only lasts 18 days. So, someone who works in the private sector only earns enough to survive for 18 days a month. And so, how can we ask a worker to invest? How can a worker invest in their own skills?
How can we help a family that can't pay their electricity bill or their rent? How can we ask them to foot the bill for this transition? Then there is the question of what this transition means for a mother who is going back to work after she has given birth to her baby. She doesn't know whether she's going to be able to make ends meet. In my view, the double transition should provide support to families.
It should be possible, for instance, if you have children, to work from home in the first one or two years of the child's life. In addition, there also need to be specific targeted measures, shortening the workday without reducing the salary, so that parents can spend time with their children in their early years. Investing in these children is a social investment. What's more, maternity and maternity leave can't turn out to be a disadvantage. And I don't have much time, so I'll wrap up now.
Whenever we have a debate on transitions like this, we mustn't forget that there are people behind them. Behind every statistic, there is a family. We must not just look at growth figures. We also need to look at whether workers can actually plan their own lives. Thank you.
Speaker 47
Thank you very much, Chairman. Thank you very much. I confess that I would have liked to have more time here because I would like to tackle something very important, at least for me: specifically, the influence of artificial intelligence on the evolution of the labor market in the future. We've been talking about protecting jobs. However, I believe we need to think about how to protect and prepare our workers for the future evolution of AI in the job market.
Speaker 52
So, this is why I am very happy that we have Eurofound with us today. We also have the European Commission with us today. Maybe together, we should conduct some studies that could answer some of the following questions I have been thinking about. So, in my opinion, it is not enough to simply see that the job market will be heavily affected by AI in the future. We need to think about the questions.
Speaker 53
And one of these questions, many of us probably have children here today: how do we protect the position of younger people in the job market? The younger generation has always been the most exposed to various developments on the job market, including the industrial revolution and now the digital AI revolution. Another question that is very important for me is: how do we prevent polarization? We will have some workers who know how to use AI, which will increase their productivity, but there will also be workers who do not have access to the skills or infrastructure to use AI. So there will be a polarization between these two.
Speaker 49
Thirdly, how do we ensure that the extra productivity generated by AI is justly distributed and contributes to social cohesion, not economic concentration? And maybe the most important thing, because we've been talking about skilling, reskilling, and upskilling, is how we adapt our social protection systems and our educational systems to these transitions, because these transitions are more and more important for the job market. Sorry for speaking longer, but all these things are very important to me. Thank you.
Thank you.
Speaker 51
Thank you, President, dear colleagues. The.
Member states have been clear, crystal clear. They said that at the Porto Summit back in 2015, the member states want competitiveness centered on people, centered on skills, and on high-quality work with fair remuneration and fair working conditions. But, of course, there needs to be adaptation to the twin transitions. At the same time, there has to be social protection, and it must be possible to have a work-life balance. The Portuguese government is consolidating its social policies by providing more creches for children up to the age of three.
Speaker 48
We also have a longevity strategy, which ensures that people's rights are protected throughout their lives. In Portugal, we're also working on a strategy to help people with disabilities, and that will help ensure greater inclusion and dignity for these people. Finally, we have a focus on upskilling and reskilling. That links to the first pillar of social rights and sustains SDG 4. All of this is in line with the RRF, and it is part of the transition.
Speaker 55
So, we have large amounts of money for lifelong learning as well as to improve social and digital skills. Finally, we have another bill going through Parliament which will modernize labor legislation. This will allow for responsible flexibilization of the labor market, which will modernize our economy without compromising our social cohesion. Thank you.
Speaker 10
Thank you. Well, let's finish off this round with Miss Delepisacarion from Spain. Thank you, ladies and gentlemen. We're talking about the social impact of the transition. During the last parliament, we talked about the social catastrophe of the green transition, but still, it's taken as red, something that we can't move on from.
I wonder why many of the objectives have been seen as unattainable, and we need to look at them again. They're very painful. At times, they are inefficient and counterproductive. The green economy has not been effective in safeguarding the environment, although it is sold as such. In Spain, it is getting rid of olives to set up solar panels.
People say that the green transition needs to be fair, but what about people without jobs? That's not fair, nor subsidies and all the social funds for the climate. When you talk about upskilling, what about European universities, engineers, and so on? But now you're talking about new academies, loads of knowledge building from zero, but because you're not looking at the experts, that's a warning that often there's a lack of consistency in terms of commitment to renewables. You're talking about the need for social dialogue, and I wonder why you're not talking to experts about that need.
You're talking about a transformation that isn't proven. There is no pilot project. We've suffered the consequences of energy prices going up, and it means that European families are in an unsustainable situation. The Maltese representative has talked about this green transition being done bit by bit, but that's not what farmers and small-scale business owners say. They're suffering the impacts day by day.
Now you're talking about wanting to be in an area, whatever. We need to be leaders. Why are you putting this through? This is pointless. You're risking our future because you are not reflecting on the errors you have made.
Speaker 2
Thank you. Thank you for that very useful debate regarding all the points. I would like to now give the floor to our guests for their final remarks. Now, each speaker has two minutes, starting with Mr. Nava.
Speaker 3
Thank you very much. I mean, I couldn't help noticing that the discussion went truly in many directions. I mean, many things were mentioned. And I think this reflects the fact that the life we will be living in the next few years is the life of the double transition. So I'm not surprised at all that we went in many directions because that is what we will be leaving.
Let me make 4 or 5 comments, taking inspiration from various sources. Point number one: involvement of social partners. That is absolutely crucial. There is no transition without the involvement of social partners. It was said by my co-guest of Malta.
And I would add to that the involvement of social partners for various tasks of the transitions, but also, for example, to ensure that there is a good mechanism for the workers to move from one job to another, and therefore, the importance of the public employment service, which was also mentioned here. Second point, many of you remarked that the issue at hand is not only a social issue but also an economic issue. I agree with that. And therefore, if it is an economic issue, it calls for money and investment. And therefore, it calls for having an ambitious MFF, for having an ambitious investment from the side of the commission, but also for member states to make the resources necessary to, for example, foster upskilling and reskilling, to make sure that new professions are supported, like, for example, with a VET strategy from the commission side followed in member states.
The importance of STEM, for example, has been highlighted, and it is clear that it will continue. And then maybe two comments on the people and the regions because both were mentioned. On the people, many of you mentioned issues that are linked to the Quality Job Act. So, mentioned issues include adequate pay, participation rate, and the fact that people are working but poverty remains high. One in 10 jobs is in job poverty.
So these are all issues that the Quality Job Act wants to address, but these issues are fundamental and require political attention, like in this room. And then the fourth one: some of you mentioned the regions. There are regions that are more affected than others by the transition. For that, of course, we have the Just Transition Fund, which we have had and will continue to look at. And finally, a comment on artificial intelligence that will enter transversely into both transitions.
I would say, for now, the best we can say is that artificial intelligence is not likely to suppress jobs but is likely to change tasks. So, the same job may have different tasks, and the tasks that are suppressed may not necessarily be in the low-level job, but also in the high-level job. Many people agree that, for example, the job of a doctor will change much more substantially than the job of a nurse due to artificial intelligence intervention. Thank you.
Microphone, please, for the speaker.
Speaker 38
Thank you. I think the most important line that we heard here today is that no region and no worker must be left behind, and I think that is what we must strive and endeavor for. The widening of inequality is something that must be banished from the EU, and this institution, as we all know, was created to benefit all the peoples of all the member nations. That must be our singular aim through these twin transitions. We see at the minute that people who are in good jobs, in many instances because of the cost of living, the cost of energy, transport costs, and the cost of housing or rental, are having their terms and conditions, and indeed pay, eroded greatly as a result of the movements in these areas. So this is something that we must focus on. I think it was Yuvalo from Eurofound.
I think the job gains and job created figures that he mentioned were extremely positive. And I think that is something we must trumpet more as a union because there is a great fear out there among the peoples of all the nations that these twin transitions may cause turmoil in the employment market and indeed erode people's rights and ability to work. I think it's correct when we say that workers must be ready for change, and the MFF must provide the resources for this. We also see the area of climate change, where people will be working in extremely difficult conditions. So, we must offer them the opportunity for better jobs and security.
I'm delighted to see that Greece is investing heavily in digital literacy, and I think this is something that we must look upon right across the Union. And we've seen in Germany where regions are changing their whole way of working, moving away from heavy industries, and this must also be supported. The member has said that it has been successful in the area of coal. In the instance of AI, I think it's imperative that we ensure that society controls AI and not the other way around. AI has many benefits that it can bring to many sectors, but we must mutually utilize it for our benefit and not the other way around.
But I think upskilling and reskilling are the two key areas that we, as a union, must invest in if the just transition is to be just that. Thank you.
Thank you.
Speaker 39
It's clear that if I had to make a summary of what my colleagues have said, it is that whatever decision we take, we must put the person at the center of our attention. It is also clear that many colleagues are in favor of a twin transition and that competitiveness and social justice have to work hand in hand. These are the main points that have come out of the interventions. Mancini talked about the principle of subsidiarity, the young people, the aspect of industrialization, and the guarantee of the right to training. And also, in view of the Draghi report on competitiveness, Greece, Latvia, and Romania talked about more investment in AI and the impact it has on workers in the labor market.
Also, I would add quantum technologies to increase our competitiveness. We are obliged to invest in these sectors, as well as in training. I would also like to talk about something that the colleague from Greece mentioned, a very important theme: there are people who cannot reach the end of the month with their salaries. We need to speak clearly. We are in politics because we need to speak face to face with our constituents, so that we can protect them. We need to move towards them.
We need to make sure that nobody is left behind. And to conclude, it is clear that the twin transition brings with it a lot of problems, but also good points. But it's imperative that we still invest and that we should be pragmatic, so that Europe can become more competitive, more resilient, and able to face all our problems.
Speaker 40
Thank you very much, Mr. Chair. The twin transition still creates uncertainties because changes are happening, and this is very human. People do not know in which direction they will go and how that will affect them. Even we see extreme cases saying no. There is no climate change, or the computers are going to eat the humans, and in five years' time, there won't be jobs for humans.
That creates an environment where people, I mean citizens, individuals, workers, are not secure. So what is very important in this type of debate is really to embrace the twin transition. I think that it can give Europe the possibility to leap ahead in terms of well-being, productivity, competitiveness, etc., if it is properly used. So it's very important also what the director general, Mister Navarro, may have mentioned. I mean the role of the European Union.
I mean, to set the goals, coordinate the policies, and then enable them, either with legislation or with funds. But it's very important to understand that the different players, that is, have their roles. This is the European Union play level, but also the national and regional levels. Social partners, civil society, all of them have their role if they have clear goals, and we know where we are going. And then, I think it's going to be much easier, and people are not going to be afraid and defensive, saying, "Oh, I cannot cope with the new technology, so I cannot deal with climate change."
This leadership is, I think, emerging from discussions; at least, I hope I'm not too optimistic. And I really think that that's a great opportunity for Europe to move forward. Thank you.
Speaker 2
Thank you, Mr. Calvin. Well, that concludes our work. If I may, just make a couple of final observations from the presidency. Firstly, I would like to thank Miss Anderson, the chair, for great cooperation, and all speakers and participants.
For their constructive and substantial contributions. Now we've seen that moving towards a fair, competitive transition isn't easy, but it is possible. High-quality provisional recycling skills, flanking measures for sectors and regions undergoing change, safeguarding social rights, and strengthening social dialogue. Those are all key instruments in attaining our objective. The central message from today's debate is quite clear.
Social cohesion and competitiveness, economically speaking, are objectives that aren't rivals. And I'd just like to finish by saying that no worker and no region should be left behind. Thank you very much. And if I may, give the floor to Miss Anderson for her final remarks.
Li Andersson
Dear colleagues, I would also like to join Chair Kafkaelias in thanking all of you for this very interesting discussion. And I think many of the points that were made and emphasized also reflect very well the discussions that we have here in the committee on the role of the social partners when managing and anticipating change, and the importance of high-quality vocational education and training for the reskilling and upskilling agenda. And also, of course, it was very good to hear positive examples of regions and areas that show that this transition really is possible to do, of course, with the aim to ensure that we are leaving no worker and no region behind. I will also take the opportunity to say that I think we will all have an opportunity to deepen this discussion in the plenary debate tomorrow on investing in Europe's future labor market resilience and social cohesion. I also want to remind you that you are all invited to dinner in the members' salon on the ground floor of the Spinelli Building.
And to remind you that tomorrow morning, we start with the first plenary session at 08:30 with Enricoletta. And I recommend you be on time because it's starting at 08:30 sharp. So, with all of these words, I wish you all a very nice evening. Thank you.
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