A new strategy of benefit to small and medium enterprises around Europe was launched last week by the European Commission in a bid to tackle unemployment resulting from the global recession. The growing rate of unemployment across Europe, which is estimated to hover around 25 million people in Europe by 2010, pressed the European Union to seek the optimal solutions to combat this mass unemployment.
The fund support of this new plan, entitled Shared Commitment for Employment, is making available e19 billion of expenditure. This scheme seeks to assist people hit by the economic crisis in 2009-2010 alone. Furthermore, the European Commission is also willing to back both EU Member States and social partners for the creation of rapid reaction packages that are focused more on job creation. In other words, the EU needs a new strengthened cooperation between all the key actors, including the EU institutions, Member States, trade unions and employers.
The key principles of such packages will help to preserve jobs and to pave the way to recovery for those facing difficulties. Furthermore, the European Commission is expected to relieve Member States’ commitment to co-finance projects for the coming months. A microfinance facility, in collaboration with the European Investment Bank and other financial partners, which is expected to fork out around e500 million in loans to stimulate the creation of small businesses and to facilitate the access to a better environment to young European apprentices, is also underway. These objectives are also consistent with the EU’s longer term strategies to reform labour markets, including the Lisbon Strategy.
As for the unemployed and those presently at a disadvantage to start their own business due to certain factors, the EU will also be offering loans and other better opportunities. According to the President of the European Commission Jose Manuel Barroso, this swift action will be the best measure in the circumstances to save jobs and create new ones. Many entrepreneurs have argued that they have constantly warned that there exists a skills mismatch, which is creating a large number of vacancies. Usually the reason is that workers do not possess the right skills to meet the needs of modern businesses.
The EU jobs plan also focuses on analysing, sector by sector, the EU labour market needs, both present and future, to include green skills. A recent report issued by the European Commission Directorate responsible for Energy and Transport revealed that a significant boost to the number of jobs in the EU would result from policies which support renewable energy sources (RES). 410,000 additional jobs will be created by improving the current policies to target the 20% RES in final energy
This Communication is the follow-up of last May’s Employment Summit. The proposals set out by the European Commission will now be presented to the European Council meeting scheduled for 18-19 June where the EU leaders are invited to sign up to the Shared Commitment for Employment. The European Commission will report on the progress of this commitment and on its implications for the post-2010 Lisbon strategy in time for the 2010 Spring European Council.
Brenda Azzopardi is Research Analyst at MEUSAC