summary fiche The European Social Fund: Active Labour Market Policies and Public Employment Services
Neither the European Commission nor any person acting on behalf of the Commission may be held responsible for the use that may be made of the information contained in this publication. Europe Direct is a service to help you find answers to your questions about the European Union Freephone number (*): 00 800 6 7 8 9 10 11 (*) Certain mobile telephone operators do not allow access to 00 800 numbers or these calls may be billed. A great deal of additional information on the European Union is available on the Internet. It can be accessed through the Europa server (http://europa.eu). European Union, 2010 Reproduction is authorised provided the source is acknowledged. Printed in Belgium PRINTED ON WHITE CHLORINE-FREE PAPER IMPORTANT NOTE The information in this brochure is taken from a broader study, produced by Bernard Brunhes International (BBI, www.bb-international.eu) under the contract Reporting on ESF interventions in the EU. The background report ESF and active labour market policies and public employment services was drafted by Jacques Dahan in cooperation with Livia Di Nardo and is available in English at http://ec.europa.eu/esf
Active labour market policies: grasping the concept Fighting and preventing unemployment and avoiding mass and long-term unemployment or inactivity have become crucial concerns of the European Union in recent years. Facing new labour market realities, and considering the way in which various countries tackled them, the European Commission, the International Labour Organisation (ILO), and the Organisation for Economic Co-operation and Development (OECD) all recommended that resources were transferred from passive to active labour market policies (ALMPs). Over the past fifteen years there has been a wide political consensus reached across the EU on the notion that ALMPs are indeed the most comprehensive and pragmatic leverage to combat unemployment while also creating more jobs. In a shift from the reactive support provided by fiscal or welfare benefits, and from highly protective employment legislation, ALMPs have the quality of conveying workers a stronger feeling of safety. Not only do they fight unemployment, but they maintain employability, and, in combination with social policies, are key to making labour markets more inclusive for all. The implementation of ALMPs falls mainly under the responsibility of public employment services (PES) and has the final goal of supporting people without jobs to get (back) into work. The measures that they translate into are aimed at empowering individuals to deal with rapid changes, at reducing their unemployment period, and facilitating their transition to a new job. The various types of ALMPs include, but are not limited to, tailored training, active job search techniques, support to self-employment and business creation, outplacement and mobility services, or incentives to encourage participation in the labour market or to reconcile work and private life. What is distinctive about active labour market policies is their ability to simultaneously influence people and labour markets in a positive way. Granting equal opportunities in access to work impacts positively on temporarily inactive people, notably on those individuals and groups who face discrimination or who are at a disadvantage in the labour market. ALMPs also make the labour market as a whole more dynamic and more inclusive. 1
The European Social Fund in a Nutshell The European Social Fund is devoted to promoting employment in the EU. It helps Member States make Europe s workforce and companies better equipped to face new and global challenges. It co-finances interventions supported by national public and private funds. The ESF strategy and budget is negotiated and decided between the EU Member States represented in the Council of the European Union, the European Parliament and the Commission. On this basis, seven-year Operational Programmes (OPs) are planned by Member States and approved by the European Commission. Operational Programmes 2000-2006: total expenditure claimed (in million) per Member State by 2 September 2008 Member State Expenditure Member State Expenditure Austria 1,326 Latvia 115 Belgium 2,416 Lithuania 166 Cyprus 22 Luxembourg 47 Czech Republic 297 Malta 9 Denmark 779 Poland 1,776 Estonia 71 Portugal 7,145 Finland 2,365 Slovakia 241 France 12,204 Slovenia 60 Germany 20,930 Spain 17,388 Greece 4,783 Sweden 2,661 Hungary 288 The Netherlands 2,458 Ireland 1,778 United Kingdom 13,285 Italy 12,909 The above interventions and expenditure do not cover the EQUAL Community Initiative which was also funded by the ESF in 2000-2006. 2
ESF Facts and Figures Most information in this brochure relates to the 2000-2006 period. In 2000, the ESF was open to the then 15 EU Member States. Additional programmes started in 2004 to accommodate the priorities of 10 new Member States. A few figures to illustrate the size of the ESF interventions: 2000-2006 Over 200 OPs together spent a total of 105 billion (until September 2008): just over half ( 54 billion) of this was paid for by the ESF, while the public and private sectors in the Member States invested the remaining 51 billion. More than 75 million people were involved in ESF activities. This corresponds to about 24% of the total population between 16 and 64 years in the EU. The ESF is committed to equal opportunities. Overall, the involvement in ESF-funded actions was balanced: 52% were women and 48% men. ESF helped young people prepare to find suitable work: 37% of all participants were between 16 and 25 years old. Supporting initiatives to keep people on the labour market is key to the ESF, in particular when workers are getting older: seven percent of ESF participants were over 55 years old. Overall, 54% of ESF participants were unemployed, 38% were employed and 8% were inactive, i.e. not readily available to get and stay in a job. Evaluations and monitoring data show that approximately half of the unemployed participants find employment within 12 months of completing an intervention. The range is 40 to 80%. 2007 onwards Data available on 75% of the current programmes showed that at least 6 million people benefited from ESF supported interventions in 2007 and 2008. 13% of these participants belonged to vulnerable groups such as migrants, minorities, people with disabilities, Roma, etc. 3
Active labour market policies in the EU ALMPs are used to redefine the nature and ambitions of the welfare state. Their objective is to maintain or improve the participation of people in the labour market. ALMP interventions focus on people outside of the labour market and in particular on specific target groups, such as the longterm unemployed, young people and disabled people. Nevertheless, ALMPs also target people already in work, like older workers or workers threatened by redundancy who need to adapt to changing work conditions, with the purpose of maintaining or improving their employability, and therefore their position in the labour market. In 1997, the European Council of Amsterdam recognised employment as a common interest issue. The Luxembourg Summit of the same year marked the launching of the European Employment Strategy (EES). One of the four main principles of the EES is to move from passive measures to active policies in order to ensure that the unemployed participate in the labour market. The EES also emphasises and relies on the local dimension of employment and on the values of local initiatives. In 2000, the European Council agreed in the so-called Lisbon Strategy to strive for full employment by 2010. The 2005 renewed Lisbon Strategy adopted the integrated guidelines for growth and employment. These guidelines further stress the importance of ALMPs by recommending Member States to implement employment policies aimed at achieving full employment, to ensure inclusive labour markets for job-seekers and disadvantaged people, to improve the matching of labour market needs with the available workers skills, to promote flexibility combined with employment security, to reduce labour market segmentation and adapt education and training systems in response to new competence requirements. 4
Active labour market policies - the champion of the ESF support throughout the EU With a view to the objective of full employment promoted by the Lisbon Strategy, the European Social Fund took up the challenge of making the European labour market more open to the vulnerable and discriminated. For the 2000-2006 programming period, 150 Operational Programmes (OP) implemented ALMPs. More than 26% of all ESF measures were designed for this purpose. The ESF supported people, as well as structures and systems. Member States invested the ESF funds to assist people through: Personalised services and integrated action plans; Training for the unemployed, those at risk of unemployment, and the inactive; Incentives for direct job creation and consolidation; for promoting business start-ups, for assisted employment and the inclusion into the labour market of people affected by exclusion; Active measures for specific target groups, such as young or people with disabilities. To get the best results out of ALMPs, a favourable environment for them to work properly is needed. ESF co-funded 18,400 projects aimed at changing the labour market system and structures, and its conditions of functioning. Various interventions designed to modernise public employment services and to develop local employment initiatives enabled a better use of ALMPs, and therefore facilitated the delivery of services to more participants. 5
The ESF support to active labour market policies and public employment services at a glance Almost 28 million European citizens took part in ALMP activities co-funded by ESF between 2000 and 2006. Half of them were women, 73.4% were unemployed and 38.9% were young. On average, ESF involved 30% of the unemployed population in the EU in its activities every year. 270,000 disabled persons took part in activities targeted at helping them to enter the labour market. ESF co-funded activities involved no less than 35.6% of the total Labour Market Policy participants (as recorded by Eurostat) on average every year. Information available on specific ALMP interventions in individual Member States indicates that about half of the unemployed people attending ESF sponsored activities with the aim of finding a job eventually found employment. ESF allocated 17 billion to activities specifically assisting people and 5 billion to assist the improvement of labour market structures and systems. Moreover, 41.2% of the global ESF co-funded expenditure was devoted to ALMPs in the EU 25. Six Member States invested more than 50% of their budget in ALMP activities: Austria, Germany, Hungary, Latvia, Slovakia and Spain. For the 2007-2013 programming period, the 27 Member States planned to reinforce ALMP activities, with a dedicated ESF budget of 29 billion. Six Member States are investing more than 50% of their 2007-2013 budget in ALMP activities: Austria, Belgium, France, Spain, Sweden and the UK. 2.5 million people participated in ALMP activities that were co-funded by ESF in 2007 and 2008. 42% of them were unemployed. One out of five participants belonged to particularly vulnerable groups such as migrants, minorities or people with disabilities. 6
Active labour market policies put people first... The emphasis of ESF-supported activities was placed on the personalisation of services, in order to ensure a better matching between people s skills and expectations, and the available jobs. The rationale is that ALMPs are an added value for individuals when they take into account their specific situations. Services need to be personalised to be successful. Profiling methods were used in several countries to individualise the provided services and to build integrated pathways leading to work. Thus, 12 Member States invested 4.3 billion in such services, and 2.6 million persons benefited from them. The direction to individualisation is further advanced in the current ESF programming period. The customisation of ALMP activities also touched training: Training for a specific job always was the first choice, rather than mass training meant to upgrade the general level of employability, but without targeting a concrete working position. 3.9 million people benefited from training programmes co-funded by ESF between 2000 and 2006.... while also improving systems and structures... The ESF supported a better functioning of the labour market institutions, with a view to enhancing the local and national governance of employment issues. This kind of broad assistance was meant to better prepare public employment services to deliver customised services to a larger number of European citizens. Equally significant, it helped develop new organisations that are able to deal with tailored support for the unemployed, and ready to take up the challenge to secure the employment transition for more people. ESF also sustained local employment initiatives involving local private and public stakeholders, with the target of increasing the efficiency in delivering national labour market policies. 7
Creating more and better jobs... 12 Member States used ESF co-funding to create new employment opportunities and to foster people s prospects to enter the labour market. 5.5 million people benefited from various workoriented actions including job subsidising, business creation or supporting social inclusion as a first step towards employment. The work first strategy, as a proxy for passive financial support, prevailed here as well and it encouraged people getting back to work. In line with this trend, business creation and the promotion of self-employment are found at the core of the 2007-2013 programming period targets. Insight: Germany: the Thüringen model The Federal Employment Office (Die Bundesagentur für Arbeit), in cooperation with the municipalities in Thüringen, implemented a range of projects that integrated the unemployed directly in the labour market. The three-phase model promoted in Thüringen combines initial qualification, job placement and accompanying training on the work place. This multi-stage approach was designed following a study that demonstrated that short-term qualifications tailored to the needs of individual participants and for a specific work place were the most likely ticket to success in the reintegration of the unemployed. A survey made after 4 years of implementation confirmed that 42% of the participants found a job within 6 months after the training.... for ALL people who can work... One of the central strands of ESF-funded activities was dedicated to groups with particular needs. Fourteen Member States invested 11 billion in breaking down the obstacles that disadvantaged and discriminated groups face and in promoting their participation into the labour market. Young people, disabled people, and people from other vulnerable groups received specific assistance and various types of support under the form of combined ALMP activities - with the final goal of creating suitable services for everyone, and of making labour markets more inclusive for all. 5.1 million people at a disadvantage were provided with coaching, training, active job search skills, incentives, pathways to integration, and support for creating small businesses. 8
All discriminated and vulnerable groups were targeted, with each country focusing on those considered most in need of aid. However, as a general trend it is worth noting that in several Member States, the ESF supported in particular young people, as well as people with disabilities.... with an express focus on people with disabilities Twenty-five measures specifically targeting disabled people were implemented to improve their employability and to facilitate their participation into the labour market. 270,000 disabled benefited from ALMP measures, out of whom 115,000 were women. 250,000 (93%) of them had initially been unemployed. Insight: Portugal: social and occupational integration of the disabled in three steps Between 2000 and 2006 a total of 52,750 people with disabilities in Portugal were the direct beneficiaries of an ESF-funded contract-programme with the Institute of Employment and Vocational Training (IEVT) (Instituto de Emprego e Formação Profissional (IEFP). This programme succeeded to link social and occupational integration, and approached the assistance to people with disabilities through three complementary action plans: (1) personal and professional development offered by the IEVT to mainly young and low-skilled people; (2) integration in the labour market through information, assessment, orientation, placement and employment; (3) innovative actions under the New Opportunities scheme in the field of professional rehabilitation. 9
Modernising labour market institutions... Great attention was given to the modernisation of public employment services, with a focus on professionalising PES employees, and on equipping them with renewed skills in order to help them face the new challenges of the labour market. 15 Member States specifically addressed this issue by co-funding training of employees in public administration at the national, regional and local level. In parallel, these states employed a total of 1.74 billion of ESF funding in a comprehensive reform of their administrations....to create a favourable environment for ALMP In various Member States such as Finland, France, Portugal and some new Member States (Slovenia, Estonia, Lithuania, Latvia and Czech Republic), new regulations and instruments were designed to make the labour market more flexible and more secure, to improve labour market organisation, to allow a greater number of people to access dedicated services, and to build the capacity of local service providers to deliver ALMPs. More than 8 million people participated in ALMP activities and programmes related to these more friendly environments. The high participation of young (46%) or long-term unemployed (84%) people stands as a proof that these actions reached out to the right audiences. Implementing local solutions for local challenges Another significant facet of the ESF support to ALMPs concerned local employment initiatives. ESF helped boost job creation at a local level, and improve the matching of supply and demand on smaller scale labour markets. This locally oriented assistance took numerous forms. Some Member States such as Germany, Spain, Greece and Belgium set up partnerships between local public and private stakeholders, while others established employment and/or business creation networks, human resources development networks, transfer companies, work foundations or houses of employment. 10
Overall, 1.8 million people participated in ESF-supported local employment initiatives: 80% of them were unemployed, 50% were long-term unemployed and almost 53% were women. The percentage of long-term unemployed is noteworthy and emphasises the importance given to grassroots initiatives gathering relevant local stakeholders. Insight: Spain: local employment initiatives at work in Andalusia In Andalusia, ESF supported the co-operation between the regional employment services and other local stakeholders, the promotion of local resources and the development of local employment strategies. Grants were provided to the 114 Territorial Units of Employment, Local Development and Technology (TUELDT) (Unidades Territoriales de Empleo, Desarrollo Local y Tecnológico (UTEDLT) from Andalusia, which act as instruments of the regional public employment service. 434 grants were used to stimulate new business activities, to promote the introduction of IT in local companies and to develop partnerships for the implementation of innovative local development projects. Moreover, the TUELDT received assistance to improve their staff s job brokering skills. Over 35,000 jobs were created with the support of this ESF measure, for vulnerable groups also, and more than 46,000 employers were provided support by the territorial units. A significant rate of insertion into the labour market ALMPs and ESF ultimately seek to get people (back) into the labour market. Due to the variety of ALMP interventions and of their target groups, it is not possible to present one average insertion rate across the EU which is based on comparable data. Member State reports indicate that the insertion rate of unemployed participants is generally around 35%. Evaluation studies examining specific programmes at national or regional level conclude that between 40 and 80% of the participants entering an ESF sponsored action with the aim of finding a job did eventually enter the labour market after the training. 11
European Social Fund 2007-2013: Investing in people In the current programming period 2007-2013, the ESF has a budget of 76 billion to co-finance 117 Operational Programmes in all 27 Member States. National public and private funds amount to a further 41 billion. The interventions supported are in the fields of: (i) adaptability of workers and enterprises; (ii) access to employment and inclusion in the labour market; (iii) social inclusion of disadvantaged people; (iv) reform in education and training systems; (v) good governance, partnership and the involvement of social partners. The map shows that ESF supports activities across all 27 Member States under two Objectives. Additional priorities in the so-called Convergence regions are: (i) lifelong learning and research and innovation; (ii) capacity building of public administrations and services. Operational Programmes 2007-2013: total budget, i.e. including national co-financing, (in million) per Member State Member State Budget Member State Budget Austria 1,184 Latvia 657 Belgium 2,320 Lithuania 1,210 Bulgaria 1,395 Luxembourg 50 Cyprus 150 Malta 132 Czech Republic 4,436 Poland 11,420 Denmark 510 Portugal 9,210 Estonia 462 Romania 4,335 Finland 1,420 Slovakia 1,764 France 10,275 Slovenia 889 Germany 15,666 Spain 11,426 Greece 5,726 Sweden 1,383 Hungary 4,270 The Netherlands 1,705 Ireland 1,360 United Kingdom 8,598 Italy 15,321 12
ESF 2007-2013 Investing in your future The level of ESF funding differs from one region to another depending on their relative wealth. EU regions are divided into four categories, based on their regional GDP per head compared to the EU average (EU with 27 or 15 Member States). Convergence regions: with a GDP per head of less than 75% of the EU-27 average Phasing-out regions: with a GDP per head of more than 75% of the EU-27 average but less than 75% of the EU-15 average Phasing-in regions: with a GDP per head of less than 75% of the EU-15 average (in the period 2000-2006) but more than 75% of the EU-15 average (in the period 2007-2013) Competitiveness and employment regions: applies to all other EU regions Position as of January 2007 EuroGeographics Association for the administrative bounderies
What ESF does for you ESF: active labour market policies and public employment services ESF: adaptability of enterprises and continuing training of workers ESF: developing human potential in research and innovation ESF and labour mobility ESF: education and lifelong learning ESF: women, gender mainstreaming and reconciliation of work and private life ESF and Roma ESF: sustainable development and eco technologies ESF: migrants and minorities ESF: urban areas and local employment ESF and older workers ESF and health ESF and entrepreneurship ESF and young people ESF and disabled ESF and institutional capacity ESF and social inclusion ESF and equality mainstreaming ESF and social partners ESF support to building partnerships ESF and culture Check the latest on these publications at http://ec.europa.eu/esf