This week in Brussels, the Fourth Demography Forum organised by the EU Commission took place in front of ca. 300 scientists, policy makers, as well as non-governmental organisations. The main focus hereby was on the demographic aspects of the Social Investment Package (SIP) adopted in February, which shall help Member States to tackle problems related to poverty and social exclusion through investments in human capital and participation in the labour market.

The cost of “doing nothing” is higher than investing sensibly

For two days, the Demography Forum discussed among other what benefits investments in the potential of young adults would bring, how one could approve the so-called “work-life balance”, how one could enable people to be active for longer and how one could successfully integrate second-generation migrants in the labour market. Commissioner László Andor opened the Conference and explained that even though an ageing society is one of most important challenges of demographic change, it is by no means the only one. Youth unemployment is probably the most serious problem at the moment and the Youth Guarantee proposed by the EU Commission could play an important part to find a solution. Andor warned that the even though the Youth Guarantee would involve costs, the cost of doing nothing would be significantly higher. This would be an example to prove that social investments do pay off. Andor concluded his address with a statement by Commission President Barroso, who said in his “State of the Union” address that the European Countries with the most effective social protection systems and with the most developed social partnerships are among the most successful and competitive economies in the world. Further proof that social investments do pay off.

Investments in childcare have only positive effects!

For years, the Chamber of Labour (AK) has been using studies to underpin its opinion that an investing social state does not only make a contribution to sustainable budget consolidation, but that it also has a positive effect on employment. The AK has only recently published a study, which illustrates the positive effects of investments in social services on the example of childcare. The latest calculation of the AK demonstrates that these, apart from significant employment effects – dependent on the overall economic development – also enable a considerable additional income for the public sector. The results of the study were presented at the Demography Forum and perceived with great interest. The study also makes a point in explaining that selected investment measures would already pay off in the medium term, i.e. after five years. This has provided the proof, which also plays an important role for Commissioner Andor, namely that investments in childcare do not only remedy current deficits as regards offer and quality, but that they also generate considerable employment and budget effects.

Further information:

AK Study: Social Investment: Growth, Employment and Financial Sustainability. Economic and Fiscal Effects of Improving Childcare in Austria