BERLIN – When the European Union held its first summit on growth and jobs in 1997, EU-wide unemployment stood at 11%. Last autumn, when it held another, not much seemed to have changed. Unemployment in the eurozone was 11.5% – up from a low of 6.8% in the first quarter of 2008.
If the EU is to fulfill its promise of peace and prosperity, it will need to find ways to create opportunities for more of its citizens. Youth unemployment is a particularly serious concern, even in countries with otherwise positive employment statistics; in countries with worse labor-market conditions, it represents a potential source of social and political instability.
Participation in the workforce is linked not only to income levels, but also to self-esteem, social inclusion, and social status. Being left out of the labor market increases the risk of poverty and poor health, and the longer unemployment lasts, the more damaging the effects. Young people who are unemployed have fewer opportunities later in life – representing a waste of education and skills that has a detrimental effect on national economies.
To be sure, some EU countries have managed to weather the crisis reasonably well. According to a new Social Justice ranking by the Bertelsmann Stiftung’s Sustainable Governance Indicators (SGI) project, Austria, Denmark, and Germany top the list in terms of labor-market access, followed by Sweden and Finland. But even in these countries, there is room for improvement. Denmark, for example, once served as a model for labor-market reform. Since the start of the euro crisis, however, unemployment has risen – from 3.5% in 2008 to 6.4% in November 2014.