Guidelines for the employment policies of the Member States

PURPOSE: adoption of guidelines for the employment policies of the Member States.

PROPOSED ACT: Decision of the Council.

ROLE OF THE EUROPEAN PARLIAMENT: the Council adopts the act after consulting the European Parliament but without being obliged to follow its opinion.

BACKGROUND: in accordance with the Treaty on the Functioning of the European Union, the Council must adopt guidelines for employment (Article 148), which must be compatible with the broad economic policy guidelines. While the broad economic policy guidelines are valid on a continuous basis, the employment guidelines must be reformulated annually.

The Broad Guidelines and the Guidelines were first adopted jointly in 2010. Revised integrated guidelines were adopted in 2015. Since 2018, the practice has been to alternate between a full update (covering both the recitals and the guidelines themselves) every other year and a "rollover" (updating the recitals but keeping the guidelines unchanged) the following year.

Following a reconduction in 2023, when the recitals were adjusted to reflect the new EU headline and national targets on employment, skills and poverty reduction and recent initiatives, a full update was carried out in 2024. The update entailed adding references to the 2030 national targets (in addition to the EU headline targets), putting greater focus on the impact of technological developments and AI, giving more emphasis to labour and skills shortages, and placing increased attention on legal migration from third countries in addition to harnessing talent within the EU. The 2024 text also reflected recent policy initiatives of particular relevance, such as platform work, the social economy and affordable housing.

CONTENT: the proposal for a Council decision stipulates that the guidelines for the employment policies of the Member States, set out in the Annex to Decision (EU) 2024/3134 , are maintained for 2025 and are to be taken into account by the Member States in their employment policies and reform programmes.

This year, the update of the recitals aims to introduce more elements concerning i) the evolving geopolitical context (trade tensions, etc.), ii) the Union of Skills initiative, iii) competitiveness, in light of the Competitiveness Compass, and iv) upward social convergence, following the second year of implementation of the Social Convergence Framework, now fully embedded into the EU's economic governance framework.

The recitals of the proposed decision stressed in particular the need for the Union and the Member States to:

- focus on developing a coordinated employment strategy and in particular on promoting a skilled, trained and adaptable workforce and inclusive, resilient and future-oriented labour markets capable of responding quickly to economic developments, with a view to achieving the objectives of full employment and social progress, balanced economic growth and a high level of protection and improvement of the quality of the environment;

- combat social exclusion and discrimination and promote social justice and protection, as well as gender equality, solidarity between generations and the protection of children's rights;

- increase competitiveness, given the uncertainty about global trade policies, as well as the effects of Russia's aggressive war against Ukraine;

- strengthen economic and social progress and upward convergence, support the green and digital transitions, strengthen the Union's industrial base, productivity and competitiveness, address demographic challenges and achieve inclusive and resilient labour markets in the Union;

- address labour and skills shortages and promote quality jobs and inclusive and quality education and training for all, in line with the Union of Skills;

- boost education and training in science, technology, engineering and mathematics (STEM), strengthen future-oriented vocational education and training and lifelong upskilling and reskilling, and work towards inclusive education systems, effective active labour market policies and improved working conditions;

- work together to effectively address structural developments related to climate change and other environmental challenges, the need to ensure a fair green transition, energy independence and increased competitiveness of net-zero industries, technological sovereignty, and the need to increase defence spending, as well as demographic developments and the development of digitalisation, including artificial intelligence, algorithmic management, the platform economy and teleworking;

- continue to involve social partners in the design, implementation and evaluation of measures to address employment and skills challenges, including the recognition of qualifications of displaced persons from Ukraine;

- support labour market transitions through a coherent set of active labour market policies - including temporary and targeted hiring and transition incentives, skills policies integrating learning for the green transition and sustainable development, flexible retirement pathways as well as targeted, effective and adaptable employment services;

- combat discrimination in all its forms, ensure gender equality and support the employment of groups that are under-represented in the labour market;

- ensure that new forms of work organisation translate into quality jobs and adequate healthy and safe workplaces and working conditions, as well as work-life balance, active and healthy ageing, maintaining established  labour and social rights, and strengthening the European social model.