The Coronavirus pandemic is having a huge impact on the European labour market. The International Labour Organization foresees the loss of 12 million full-time jobs in Europe in 2020. The sectors most at risk include accommodation and food services, manufacturing, retail and administration. To mitigate the issues, the European Union has put in place a scheme called SURE, which stands for Support to mitigate Unemployment Risks in an Emergency. It’s part of a 540 billion euro package to support European companies and workers.
There are up to 100 billion euros available for the SURE scheme, supported by 25 billion euros in guarantees from EU members. States can apply for the cash after they’ve activated schemes to help those either in regular work or self-employed people who’ve lost income. The assistance comes in the form of a loan on favourable terms.
Almost half of Italian workers are experiencing a loss of income. Since the beginning of the coronavirus crisis, the government has allocated eight billion euros to around seven million workers and another four million people who are self-employed. Italy is the second most indebted country in Europe, and the International Monetary Fund forecasts that its GDP will drop by 9.1% this year. Without appropriate assistance, the workers most affected by this crisis are at risk of experiencing great difficulties.
Lucas Visentini, head of the European Trade Union Confederation warns that this recession will deeply damage the European economy and jobs – unless the EU makes really generous provisions: “We think that the recovery plan should imply at least double the amount of money for the European budget, not only 1% of the GDP of the EU but 2%. So we need an additional one trillion euros made available and the only way to finance all of this and to make sure that it is real financing, fresh money, is to have some kind of European bonds in place.”
European Employment Commissioner Nicolas Schmit agrees that, with a forecast of 12 million full-time jobs being lost in Europe, that as many people as possible need to retain their jobs: “That’s what we try to do through the instrument of short-time work – the SURE instrument which I hope can be adopted very, very soon.”
Some of the hardest-hit countries such as Italy or Spain already have weak economies and their economies rely on struggling sectors such as tourism. What does the Commissioner think can be done to help them? Commissioner Schmit believes the issue is complicated by countries having not been hit in an equal way: “When you look at some countries where tourism represents more than 10 per cent, sometimes 20 per cent like in Greece, approximately 20 per cent of GDP, that will be a real blow. So firstly, (we need to help) these countries to maintain as many companies in the tourism business or in the tourism-related business. And this means we have to have in Europe a level of solidarity.”
There is a huge part of the European population working in the so-called “black economy”; they lost income and they cannot legally claim unemployment benefits. How can these people be protected? Is the Commissioner considering including them in the new scheme? “When I launched a few weeks ago the initiative to tackle undeclared work, it was before the virus came. I insisted on the fact that (black market working) is not something which should happen in Europe anymore. But I’m realistic. Unfortunately, in some member states, this undeclared economy is still very high and still very broad.”
“Giving these people the possibility to have an income is absolutely indispensable and then try to bring them into normal declared jobs – and continue fighting undeclared work. Because that’s bad for the people. It’s bad for the economy. It’s bad for public finance. It’s bad for our Social Security systems,” Commissioner Schmit concludes.
Source: Euro News
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