2003 employment guidelines and recommendations adopted

The 2003 EU employment guidelines and employment policy recommendations to the Member States were adopted in July 2003. Following changes to the European employment strategy, the timing of the process and the contents of the guidelines and recommendations have been modified in 2003. The employment guidelines now focus on 10 policy priorities, rather than grouping a larger number of guidelines under four pillars as was previously the case, and set concrete targets for most of them.

On 22 July 2003, theCouncil of the European Union adopted the 2003 employment guidelines and recommendations on employment policy to Member States, which had been proposed by the European Commission in April 2003. These guidelines and recommendations are drawn up within the context of the European employment strategy (EES), which has been in place since 1997. Following a review of the EES undertaken in 2002 after five years of operation (EU0209204F), and proposals for its streamlining, made by the Commission in a Communication in September 2002 (EU0210206F), the timing and the content has changed somewhat in 2003. Notably, the employment guidelines have been revised so as to: ensure a stronger link with EU economic policy coordination (through streamlined timetables); lay down fewer guidelines with a broader perspective; provide a medium-term time horizon in order to achieve an increased emphasis on results and outcomes; and strengthen the involvement of the social partners, local authorities and other stakeholders.

Employment guidelines

The 2003 employment guidelines to the Member States set out three main objectives:

  • full employment;
  • improving quality and productivity at work; and
  • strengthening social cohesion and inclusion.

While still maintaining the employment targets set at the Lisbon (EU0004241F) and Stockholm (EU0104208F) European Council meetings in 2000 and 2001, in order to achieve these three objectives, the guidelines focus on 10 policy priorities, rather than grouping a range of guidelines into four pillars, as has previously been the practice. These 10 priorities are set out below.

Active and preventative measures for unemployed and inactive people

Member States are urged to develop and implement active and preventative measures in order to prevent inflow into long-term unemployment. These include the concrete targets of:

  • ensuring that every unemployed person is offered a 'new start' within 12 months of being unemployed (six months in the case of young people). This can take the form of training, retraining, work practice, a job or some other employability measure; and
  • by 2010, ensuring that 25% of long-term unemployed people participate in an active measure, with the aim of all countries achieving the average performance of the three most advanced Member States.

Member States are also urged to modernise and strengthen their labour market institutions, in particular employment services, and to evaluate and review the effectiveness and efficiency of labour market programmes.

Job creation and entrepreneurship

Member States are urged to encourage the creation of more and better jobs by fostering entrepreneurship, innovation, investment capacity and a favourable business climate. The focus should be particularly on exploiting the job creation potential of new enterprises, the service sector and research and development.

In particular, Member States are urged to simplify and reduce administrative and regulatory burdens for business start-ups and small and medium-sized enterprises (SMEs), making it simpler to hire new staff and improving access to capital for start-ups, SMEs and companies with a high growth and employment potential. Member States are also urged to promote education and training in entrepreneurial and management skills.

Addressing change and promoting adaptability and mobility in the labour market

The guidelines ask Member States to facilitate the adaptability of workers and firms to change, 'taking account of the need for both flexibility and security and emphasising the key role of the social partners'. They also ask Member States to: review and reform 'overly restrictive' elements of employment legislation; develop social dialogue; foster corporate social responsibility; promote diversity of contractual and working arrangements, particular in order to favour career progression and a balance between work and private life and between flexibility and security; and promote access to training. Member States are also asked to promote: better working conditions; the design and dissemination of innovative and sustainable forms of work organisation; and the anticipation and positive management of economic change and restructuring.

Member States are urged to address labour shortages and bottlenecks by means of a range of measures such as promoting occupational mobility and removing obstacles to geographic mobility, improving the recognition and transparency of qualifications and competencies and the transferability of social security and pensions rights. It is hoped that, by 2005, jobseekers in the EU should be able to consult all vacancies advertised through Member States’ employment services.

Development of human capital and lifelong learning

Member States are asked to implement lifelong learning strategies in order to equip individuals with the skills required in today’s workforce, to permit career development and to reduce skills mismatches and labour market bottlenecks.

The following targets should be achieved by 2010:

  • at least 85% of 22-year-olds in the EU should have completed upper secondary education; and
  • the EU average level of participation in lifelong learning should be at least 12.5% of the adult working-age population (25-64-year-olds)

Labour supply and active ageing

Member States are urged to increase labour market participation by using the potential of all groups in the population, using a comprehensive approach. They are also asked to promote 'active ageing', notably by fostering working conditions which are conducive to job retention. This could include measures such as access to continuing training and innovative and flexible forms of work organisation. Further, incentives for early exit from the labour market should be eliminated, largely by reforming early retirement systems, giving people incentives to remain active in the labour market and encouraging employers to recruit older workers.

By 2010, it is hoped that there will be a five-year increase in the average EU exit age from the labour market – this was estimated to be 59.9 years in 2001. The guidelines emphasise the important role of the social partners in this regard.

Gender equality

Member States are asked to encourage female labour market participation and achieve a substantial reduction in gender gaps in employment rates, unemployment rates and pay by 2010. The gender pay gap should be reduced using measures such as addressing sectoral and occupational segregation, education and training, job classifications and pay systems, awareness-raising and transparency.

Reconciling work and private life is identified as an important aspect of gender equality. Concrete targets, to be achieved by 2010, are to provide childcare to at least 90% of children between three years old and the mandatory school age and to at least 33% of children under three years of age.

Integrating and combating discrimination against disadvantaged people

People at a disadvantage in the labour market include early school-leavers, low-skilled workers, people with disabilities, immigrants and people from ethnic minorities. Member States are urged to develop their employability, increase job opportunities for them and prevent discrimination against them. Concrete targets to be achieved by 2010 are as follows:

  • an EU average of no more than a 10% early school-leaver rate;
  • a significant reduction in the 'unemployment gaps' for people at a disadvantage, according to nationally-set targets and definitions; and
  • a significant reduction in the 'unemployment gaps' between non-EU and EU nationals, according to nationally-set targets.

Making work pay

Member States are exhorted to develop policies which will make work attractive and thus encourage people to seek and remain in work. Tax and benefit systems should be reviewed and, where appropriate, reformed, in order to encourage more people into work, particularly women, low-skilled workers, older workers, people with disabilities and 'those furthest from the labour market'.

By 2010, Member States should aim to have policies in place which achieve a significant reduction in high marginal effective tax rates and, where this is appropriate, in the tax burden on low-paid workers, although this should reflect national circumstances.

Undeclared work

Undeclared work is an area where the Commission hopes to see significant improvement in the coming years. The guidelines state that Member States should aim to eliminate undeclared work using measures such as: the simplification of the business environment' removing disincentives to declaring work; providing incentives to declare work, by means of adjustments to the tax and benefits system; and improving law enforcement and the application of sanctions.

Regional employment disparities

Member States should work towards reducing regional employment and unemployment disparities. In particular, they should promote favourable conditions for private sector activity and investment in the poorer regions and ensure that public support in these regions is focused on investment in human and knowledge capital and an adequate infrastructure. Further, the potential of the EU cohesion and structural funds and of the European Investment Bank should be 'fully exploited'.

Implementation of guidelines

The 2003 employment guidelines include a section on 'good governance and partnership' in their implementation. Member States are to ensure the effective implementation of the guidelines, including at the regional and local level, and should involve parliamentary bodies, social partners and other relevant actors. Good governance and partnership are seen as important issues for the implementation of the EES, 'while fully respecting national traditions and practices'.

With regard to the social partners, they should be invited at national level - 'in accordance with their national traditions and practices'- to ensure the effective implementation of the guidelines and to report on their most significant contributions in all areas under their responsibility, in particular concerning: the management of change and adaptability; 'synergy' between flexibility and security; 'human capital development'; gender equality; making work pay; active ageing; and health and safety at work. The European-level social partners at intersectoral and sectoral level are invited to contribute to the implementation of the employment guidelines and to support efforts undertaken by the national social partners at all levels. As announced in their joint work programme for 2003-5 (EU0212206F), the European intersectoral social partners will report annually on their contribution to the implementation of the guidelines. Furthermore, the European sectoral social partners are invited to report on their respective actions.

Employment recommendations

The 2003 recommendations give each Member State guidance on policy and the implementation of the employment guidelines, in the following 12 policy fields:

  • unemployment prevention and activation;
  • job creation in regions;
  • change and adaptability;
  • lifelong learning;
  • labour supply and active ageing;
  • gender equality;
  • people at a disadvantage;
  • making work pay;
  • undeclared work;
  • job mobility;
  • social partnership; and
  • delivery services.

All Member States have at least three recommendations addressed to them, and 57 recommendations have been issued in total. More than half of the Member States have received recommendations in the field of labour supply and active ageing, gender equality, lifelong learning and unemployment prevention and activation, including development and modernisation of employment services.


The 2003 guidelines and recommendations comprise the latest progress towards the attainment of the employment goals set at the Lisbon and Stockholm spring Councils of 2000 and 2001. While it is clear that work remains to be done in terms of the modernisation of individual Member States’ employment policies, and that some Member States have more work to do in this area than others, significant progress has nevertheless been made towards increasing overall employment rates across the EU, in addition to improving the participation rate of women and older workers. The streamlining of the European employment strategy and the refocusing of the employment guidelines will doubtless be instrumental in moving this process forward. (Andrea Broughton, IRS).

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