Much depends on a well-functioning labour market – this is true for individuals and their families, but also for society and state. Whether it´s the population’s income situation, the breakup of traditional family structures, the affordability of living space, people’s health or time for family and friends: the labour market is pivotal in addressing and shaping many of these issues.
EU-wide study on labour market situation
The closer countries come to fulfilling the target of “full employment”, the better for all of us. The systemic view towards national labour markets in Europe is always worthwhile. Based on the Labour Market Monitor, the Austrian Chamber of Labour, in cooperation with the Austrian Institute of Economic Research (WIFO) creates an annual EU-wide study on the labour market situation. This year’s Labour Market Monitor 2020 is already the 10th update to be published. The focus this time is on the period prior to the Covid-19 crisis, whereby the main data to be compared originates from 2019.
It is important to see the conditions under which countries slid into the recent crisis – and to reflect whether the EU countries did indeed overcome the financial and economic crisis from 10 years ago. Undeniably, some countries have “deep scars” to this day.
Northern European countries ranking top
Traditionally, it is mainly the “small” Member States with open economies that are at the top of the European league. Above all, the Nordic countries Sweden, Finland and Denmark can consistently be found ranking at the top. According to a major GDP data revision, Ireland, with regard to some indicators, can also be found at the top. In contrast, mainly the Southern European countries as well as “more recent” Member States such as Greece or Bulgaria, are trailing behind.
The Labour Market Monitor also shows the impact the financial and economic crisis had on the labour market. Hence, the first dimension, which deals with the overall performance of the labour market, reveals that due to the crisis, the labour market performance of the EU Member States has strongly diverged.
Austria rarely rising above the level of mediocrity – Coronavirus magnifies current imbalances
The empirical evidence suggests that Austria is increasingly lagging behind the top group. The main drawbacks – also in relation to other EU countries – have been hardly or not at all reduced. A lot of catching up is in particular required with regard to gender equality, older employees and health aspects.
The study shows that great effort is needed to noticeably improve Austria’s ranking: without a more active employment and labour market policy, Austria will be increasingly left behind by the top group – with all associated negative effects both at individual and social level.
On the Labour Market Monitor
It is the objective of this long-term project to provide a comparing overview of the labour market realities of the EU Member States. The focus is not only on analysing current trends, but to also on suggesting potential questions for a deeper analysis.
Whilst the sometimes superficial observation of the labour market situation in the EU is often limited to only a few key indicators – in particular the unemployment and employment rate –, the Labour Market Monitor attempts, based on 58 indicators, to shed light on a wide range of relevant aspects, thereby painting a more differentiated picture.
5 empirical analysis dimensions
The Labour Market Monitor assesses
- The general performance of the labour market,
- The labour force participation of various groups,
- Exclusion risks in the labour market,
- The distribution of earned income as well as
- The redistribution by the welfare state.
Each of these five dimensions is built on a number of comparable and regularly available indicators throughout Europe, on the basis of which a range index – in this case a number between 1 and 10 – is created. That way it is possible to clearly depict and compare complex economic, political, and social coherences. Apart from that, the study not only shows, which countries lead the way in the respective dimensions, but also what makes these countries stand out.