EurWORK European Observatory of Working Life

Alert Mechanism Report

The Alert Mechanism Report (AMR) is the starting point of the yearly cycle of the European Commission’s Macroeconomic Imbalance Procedure (MIP). The MIP was introduced in 2011 as part of the ‘six-pack’ of legislative measures, aimed at reinforcing economic governance in the European Union. The report is produced annually and presents the outcomes and analysis of a scoreboard of 11 indicators regarding the economic performance of EU Member States. The process aims to identify Member States that are showing signs of potential macroeconomic imbalances (damaging both to their economies and to the smooth functioning of the Economic and Monetary Union) so that the necessary policies can be implemented to prevent them. The alert mechanism is described by the European Commission as a ‘filter’ to identify countries and issues for which more in-depth analysis is required.

The conclusions of the AMR are discussed by the European Council and the Eurogroup (an informal body that brings together the finance ministers of eurozone countries), enabling the Commission to obtain appropriate feedback from Member States in order to prepare specific in-depth reviews for some countries.

If the Commission deems that a Member State has macroeconomic imbalances, it will propose policy recommendations as part of the European Semester process. If the Commission considers that the imbalances may jeopardise the EMU, it can ask the Council to open an Excessive Imbalance Procedure (EIP).The Commission’s first AMR (127 KB PDF), issued in February 2012, called for a closer look at the macroeconomic situation in 12 countries: Belgium, Bulgaria, Cyprus, Denmark, Finland, France, Italy, Hungary, Slovenia, Spain, Sweden and the UK. It noted that the countries implementing reforms negotiated with the Commission and supported by external financial assistance – Greece, Ireland, Portugal and Romania – were already under enhanced economic surveillance, and that therefore their economic situation and policies would not be examined under MIP.

The Commission’s second AMR (220 KB PDF) was published in late November 2012; this time around, it called for a closer look at 14 Member States: Belgium, Bulgaria, Denmark, Spain, France, Italy, Cyprus, Hungary, Malta, Netherlands, Slovenia, Finland, Sweden and the UK.

In October 2013, the European Commission issued a Communication (188 KB PDF) recommending that social considerations should feature in the implementation of the MIP, with a view to fostering better understanding of the risks of such imbalances for unemployment, poverty and wider social consequences. It suggested adding relevant indicators to the Alert Mechanism Report, such as the participation rate, the long-term unemployment ratio, the youth unemployment rate and the risk of poverty and social exclusion rate (EU1310011I).

See also: Broad Economic Policy Guidelines; Economic And Monetary Union; Employment guidelines; European economic governance; European Employment Strategy; EU system of industrial relations; European Globalisation adjustment Fund; Integrated guidelines; Lisbon Strategy; National Action Plans; National Reform Programmes; Treaty on Stability, Coordination and Governance.

Please note: the European industrial relations dictionary is updated annually. If errors are brought to our attention, we will try to correct them.
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