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ETUC Conference – delivering Lisbon

ETUC Conference – delivering Lisbon. Aggregate demand policy and the labour market John Morley University of Nottingham Business School 1 March 2005, Brussels, Belgium. 1033. Lisbon European Council 23/24 March 2000. New employment targets

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ETUC Conference – delivering Lisbon

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  1. ETUC Conference – delivering Lisbon • Aggregate demand policy • and the labour market • John Morley • University of Nottingham Business School • 1 March 2005, Brussels, Belgium 1033

  2. Lisbon European Council 23/24 March 2000 New employment targets ‘to raise the employment rate from an average of 61% today to as close as possible to 70% by 2010’ ‘to increase the number of women in employment from an average of 51% today to more than 60% by 2010’ 868

  3. Lisbon and the labour market • Four basic economic questions • Does the EU have an employment problem? • Is it getting better or worse? • 2. How much does EU employment growth • depend on EU economic growth? • 3. To what extent is inflation an • obstacle to EU employment growth? • 4. How flexible is the EU labour market? • How does flexibility affect employment? 1039

  4. Lisbon and the labour market Question 1 – the EU’s employment performance EU v US employment performance Employment performance across Member States The gender-age dimension of the employment gap 1039

  5. Europe’s employment problem % Employment Rates Japan USA EU15 1960-2001 1021

  6. Recent employment rates trends – EU-US Per cent of population aged 15-64 in employment US EU Source: US Household Survey and EU Labour Force Survey 36

  7. Employment rates 2003 - EU15 Unadjusted Full time equivalents % population15-64 Lisbon target 2010 Number employed 15-64 as a percentage of working-age population, 15-64 Source: Eurostat 3

  8. Employment rates by age (men) EU-US 2003 EU US % Men employed as a percentage of population in different age groups 34

  9. Employment rates by age (women) EU-US 2003 EU US % Women employed as a percentage of population in different age groups 35

  10. Employment rates 2003 – new Member States Unadjusted Full-time equivalents % population15-64 Lisbon target 2010 Source: Eurostat Number employed 15-64 as a percentage of working-age population, 15-64 20

  11. Lisbon and the labour market Question 2 – Employment performance and the economy Growth and employment Cyclical recoveries – EU and US style Investment and employment 1039

  12. EU GDP and employment growth Annual % change Source: Eurostat 8

  13. Employment growth in EU15 and US Annual percentage changes 1960-2003 EU15 US 9

  14. Investment and unemployment - EU15 % Investment share of GDP % Unemployment rate Investment share of GDP Unemployment rate 899

  15. Lisbon and the labour market Question 3 Employment and inflation – how related are they? Inflation and unemployment Structural unemployment The wage share 1039

  16. Inflation and unemployment - EU EU15 Inflation rate Unemployment rate 1002

  17. Inflation and unemployment - US US Inflation rate Unemployment rate 1003

  18. Structural unemployment OECD estimates 1997Actual Unemployment 2001 %

  19. Wages shares in EU, US, Japan % Japan EU15 USA Percentage of GDP at factor cost 830

  20. Lisbon and the labour market Question 4 – Labour market flexibility From temporary to permanent jobs From part-time to full-time jobs Making work pay – cutting social transfers 1039

  21. Flexibility – transitions year to year Year 1 Year 2 PERMANENT Permanent contract Temporary contract Unemployed or inactive TEMPORARY FULL-TIME Full time Part time Unemployed or inactive INVOLUNTARY PART-TIME ECHP 1995/1996 EU14 1034

  22. Social transfers and unemployment % % Social transfers Unemployment rate Unemployment rate Social transfers (% GDP) 1970-1999 841

  23. Lisbon and the labour market • Some issues for psychologists and psychiatrists • as well as economists • Treating delusions - why do so many people in authority look at reality, but see something else? • 2. Right meets left - financial market analysts • are coming round to our point of view • 3. Public education - what can be done to correct misconceptions and promote positive policies? 1039

  24. The State of Working Europe For more information and analysis of the EU economy and labour market download 2004 report free of charge www.thestateofworkingeurope.org SOWE asbl Authors: John Morley, Terry Ward, Andrew Watt 1039

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