The Autumn Package marks the start of the European Semester cycle, which will set the course for the Member States' economic, employment and fiscal policy priorities for the coming year. As such, the Autumn Package serves as a basis for developing policy guidelines and Country Specific Recommendations presented in the Spring Package. These measures will subsequently be implemented by the Member States during the latter half of the year.

 

Competitiveness as the primary objective

 

The starting point for the current Autumn Package, presented on 25 November 2025, was this year's Autumn 2025 Economic Forecast. The European Commission finds that, although the European economy is showing resilience and moderate growth, it still faces several important strategic and structural challenges, such as low productivity, demographic pressure and increasing demands on public finances arising from defence and the green and digital transition. The Commission stresses that strengthening competitiveness and maintaining sound public finances are crucial to unlocking growth potential and ensuring stability.

 

Referring to the challenging geopolitical context and the Draghi Report and the Competitiveness Compass, the Autumn Package prioritises productivity, innovation, and investment to strengthen competitiveness, resilience and securing prosperity. The agenda also targets labour market improvements, regional competitiveness, human capital - especially in health - reducing reliance on non-EU countries, and less administrative burden. Additional goals include developing transport and clean energy infrastructure, advancing digitalisation, combating poverty, and supporting affordable housing.

 

Extended structure of the Autumn Package

 

In addition to the Communication, the Autumn Package includes, as usual, a Euro Area Recommendation, the Alert Mechanism Report under the Macroeconomic Imbalance Procedure, the Commission's Proposal for a Joint Employment Report and other documents. The input from the European Trade Union Confederation on the EU Semester “For a sustainable economy and social progress” is also particularly interesting.

 

New additions to this year's package are the draft Council Recommendation on Human Capital in the EU and the 2026 European Macroeconomic Report, which provides an overview of the economy of the euro area and the EU and analyses the main risks and opportunities. Additionally, the 2026 cycle of the European Semester is designed to act as a connection to the next Multiannual Financial Framework (MFF) 2028–2034. The National and Regional Partnership Plans (NRPPs) outlined within this framework must effectively tackle the challenges identified during the European Semester and address the country-specific recommendations.

 

Economic policy in the euro area and in the Member States

 

In addition to the above-mentioned objectives, a neutral fiscal policy with greater temporary flexibility in relation to defence spending and competitiveness is recommended for economic policy in the euro area. This is intended to create more leeway for new spending pressures. Higher defence spending should go hand in hand with the elimination of bottlenecks in industry and the labour market. Member States should also complete the implementation of their plans under the Recovery and Resilience Facility by August 2026 to ensure that the available EU funds are used. For this to succeed, measures to promote education and training, improve job quality, combat poverty and increase access to affordable housing will be necessary. The Savings and Investment Union is also to be advanced. Other recommendations include working on the digital euro, strengthening the international importance of the euro and ensuring financial stability by monitoring risks in the banking and non-banking sectors.

 

The Commission's evaluation of Austria's budgetary position indicates that net expenditure growth complies with established thresholds. For the eight other countries under an Excessive Deficit Procedure (EDP), the Commission does not currently propose any further actions beyond the existing procedures. Germany and Finland were assessed within the Autumn Package regarding the potential initiation of an EDP; no procedure is recommended for Germany, while consideration for initiation is ongoing for Finland. The Alert Mechanism Report identifies Greece, Hungary, Italy, the Netherlands, Slovakia, and Sweden for additional comprehensive reviews of macroeconomic imbalances.

 

Employment and ‘human capital’

 

According to the Commission’s Joint Employment Report, the EU's employment target of 78% is likely to be achieved, although there are significant differences between and within Member States. Moreover, the productivity gap in the EU compared to other economies is a cause for concern. Poor working conditions in some sectors are cited as a driver of the often lamented shortage of skilled workers. In addition to employment policy guidelines, the report also covers the monitoring of the European Pillar of Social Rights. In 2024, despite being in employment, one in twelve workers in the EU was at risk of poverty. Here, and also with regard to the targets for adult education, considerable efforts are needed to reduce the number of people at risk of poverty and social exclusion by at least 15 million.

 

For the first time, the Commission also published a Council Recommendation on Human Capital in the EU. The purpose of this report is to address the shortage of skilled workers in strategically important sectors. The recommendations relate to strengthening education and training and promoting skills, including basic digital literacy. Member States are encouraged to speed up the recognition of qualifications from other EU countries and beyond. The Commission identifies clean transitions, the circular economy, decarbonisation, health, biotechnology, agriculture, defence, and space travel as key strategic sectors. It also highlights the need for current data on human capital to help identify future training courses and job opportunities.

 

Chamber of Labour critical of Autumn Package

 

AK supports the Autumn Package’s recommendations on further training and retraining, affordable housing, higher labour force participation, better job quality, and poverty reduction. However, all this is inextricably linked to the rigid EU fiscal rules. This puts even greater pressure on important green and social investments and ongoing social spending. Fair and pro-business policies, on the other hand, can be implemented on the basis of revenue measures such as wealth taxes and inheritance taxes. Forward-looking investments can be made and painful cuts avoided. This not only secures prosperity but also supports aggregate demand and promotes long-term sustainable competitiveness. The emerging link between EU budget payments and compliance with country-specific recommendations is extremely sensitive and questionable. This is also relevant to the ongoing ‘simplification agenda’, which has led to concerns that national labour and environmental standards may be weakened. Overall, the democratic nature of the Semester process and the protection of workers' interests must be guaranteed.

 

Further Links:

 

EU Commission: 2026 European Semester Autumn Package

EU Commission: 2026 European Semester: Autumn Package

EU Commission: Autumn 2025 Economic Forecast shows continued growth despite challenging environment

ETUC: Workers won’t recognise Commission’s economic optimism

ETUC: Macroeconomic Outlook 2025

AKEUROPA: A Compass for the EU's Competitiveness