"ILO is ready to help", says Guy Ryder, Director-General Elect, in his closing statement at EU Employment Conference

Describing the conference as "an opportunity to think together of how the ILO and the EU can deepen their very positive relationship", the ILO Director-General Elect Guy Ryder said that the ILO is ready to help Europe solve its problems caused by the economic crisis. He stated that the ILO could play a key role in the most crisis-hit EU countries like Greece, and could help the EU address its youth employment crisis. Ryder also called for profound EU-ILO cooperation in the G20.

Statement | Brussels | 17 September 2012
Thank you very much Commissioner, Minister, Dear friends,

I want to thank Commissioner Andor for his invitation and also to congratulate him on the timeliness of this event and its content. It has been a very impressive and a very useful event.

I would like to bring in the global perspective in the discussion. I think it is important for Europeans – as it is for everybody else – to keep in mind that what we have before us is not simply a regional job crisis, it’s a global jobs crisis. And the fact that Europe is at the epicentre does not detract from its global scale.

In fact, as one of the rapporteurs indicated today, I’m tempted at this very late stage to suggest a somewhat different title of the conference: not ‘Jobs for Europe’, but ‘Jobs for the world’. The global unemployment figure is over 200 million, affecting something over 6 per cent of the world’s labour force is unemployed. That’s before you start touching on issues of underemployment, let alone precarity.

The global employment participation rates are down as a result of the crisis, down the full percentage point. It means that the global jobs gap, to get global employment rates back up to pre-crisis levels, is 50 million jobs.

The G20 jobs gap is 21 million. That’s the global scale of the problem that we have. And if you look at the situation of youth, well, you just simply have to double the percentage figures. Global youth unemployment is at 12.7 per cent, and you probably have to add on another percentage point to that to take into account the reality of discouraged youth- youth that has just simply come away from the labour market

That’s what we are faced with. That’s the global context within which you are dealing with the drama of a European unemployment crisis. And of course, we know that the economic prognosis gives us little space for comfort or encouragement.

You, I’m sure, heard what the OECD Secretary General Mr. Gurria said yesterday, and you’ve probably read the OECD interim projections published. We are faced with a situation where outside Europe the outlook is deteriorating. China seems ready to settle for lower growth rates, 7.5 per cent, something it would not have settled for even two years ago. India is at a moment of very soft growth and we have seen a quite rapid slowdown of growth in Brazil. So Europe should not think that it could look to external locomotives to get the train going again. It’s worth bearing this in mind, too.

Now that’s the context, and it’s not a very encouraging one. I have to say that I found the opening session of this conference yesterday really quite an extraordinary one. And I think we received from the leaders of the European Union an extraordinary set of messages, from the three Presidents. I’m tempted to say not an ‘extraordinary set of messages’, I’d say ‘one message’ because the message was the same.

In his very first sentence to us, President Van Rompuy said that “there can be no higher priority than jobs for Europe”. President Barroso spoke – and you have to think of what it means – of social emergency situations in this continent.

At the same time, there was recognition of what the price of failure to act and to improve would be. President Barroso spoke of crisis of confidence, of credibility in Europe, and in its values and its model. He spoke of the danger posed to the stability to our societies, and we see the symptoms of that danger. We see it of course in peaceful demonstrations. We see it occasionally in less peaceful outbreaks of disorder.

But above all, if we have our eyes open, we should see it in the quiet desperation of millions of European citizens who find themselves out of a job, falling through or around social protection systems, finding themselves in conditions of poverty or finding that their children have no realistic job prospects for the future.

That’s where we are. But the message, I think, from this conference yesterday, and I believe it’s a message that we have to pick up and act upon, is that there is recognition of the problem. There is also absolute consensus – that’s what I detect – on the urgency of action to make a difference.

And a start has been made. A start has been made with the European employment package, and we’ve heard from the EU Cypriotic Council Presidency how a number of actions are going to be taken forward. This is welcomed. And having recognized the political challenge, the question is – and we will all be judged together – how we react.

Do we have the political will? Do we have the common political purpose to meet our responsibilities to those we represent, either as politicians, as trade union leaders or business leaders? That’s a challenge before us, and nobody should want to dodge it, I think nobody will be allowed to dodge it.

Now, given that strong consensus, a strong recognition of the need to act, where is the problem? What’s holding us back? Well, we have of course this rather obvious disconnection, if I can call it that, between our macroeconomic policy targets and objectives and our employment goals – that priori has to be clear. Our current macroeconomic s stance is not the one that one would normally advocate to deal with the employment situation of the dramatic proportions that we have in Europe.

But we’re not innocent; we know that other policy situations and imperatives are at play. How do we move forward? I think through recognition in the first instance. The clear evidence before us is that, in employment terms, the current austerity structural reform has produced results - and I use the language of others expressed today and yesterday at the conference - are unacceptable.

So we do need to move on, and we do need to move on now. And the good news, in my view, is that Europe is very well equipped to move on. It’s very well equipped because of what President Barroso described as is the DNA of dialogue and collective bargaining. There is a habit, an instinct, a predisposition to work together, to talk together, to overcome differences and to work to common purpose.

The EU has the institutions. And there is, too, a predisposition – it’s a word I like and it’s a word that has been used a lot – to solidarity in Europe. And I think that we have to bring that predisposition of solidarity to bear.

Now I am not too starry either – in case you thought I was – to believe that we are all going to go forward without any difficulties, without any problems. Listening to some of discussions yesterday and this morning, some of the major debates that were out there are very, very clear.

But there are challenges that I think we can all meet together. We know we need to repair the financial system, we know about the need to recapitalize the banks. And we know, and surely nobody can be more aware of it than the business community, of the need to get credit lines open to SMEs, where two thirds of European jobs lie, and we need to find ways to ensure that when businesses are sitting on high levels of liquidity, they choose to use that to invest in productive purposes.

All of that needs to happen. I am going to come back, as many of you have done, to the question of youth. And I know the complexities of the debate. I heard what the rapporteurs had to say. But it seems to me that with millions young Europeans out of a job and out of any type of training, we have to look again at the types of activation guarantees that have proved effective nationally at different places, at different times, and at affordable cost. The fact of the matter is that youth activation guarantees historically have come in at something like 0.5 % of government spending. And I think that if we take the approach that Professor Pissarides advised us yesterday, of treating these as investment projects, not to count year by year, the pay-back is even more obvious than it might otherwise be. I cannot see any reason not to move forward with determination in that direction.

I would make a similar point about the long-term unemployed, whose tragedy – it seems to me – is no less great, no less compelling than that of a lost generation of youth. Committing European citizens to the fate of long term unemployment is simply not one we should countenance.

Then we come to the very tricky areas of labour market reform and the way we have to address different levels of competitiveness in Europe. Time does not permit me to go into this very complex debate at length. It is not the right moment anyway. But let’s take note of couple of things. Let’s take note that President Barroso himself spoke about the need for balanced reform of labour market. And I think the notion of balance, without going into the many debates, is extremely important.

President Barroso is also eloquent in talking about the dangers of growing precarity in labour markets and he also warned us of the growing phenomenon of the working poor. 50% of households which are poor in Europe have at least one person employed.

Balanced too, in wages. Balanced too, in getting this link between wages and productivity, in surplus countries as well as in deficit countries. Major challenges for us. But no reason other than a lack of political will, why we shouldn’t tackle them together.

Can the ILO play a role? Can it be helpful? Can we help move forward? Well I hope that we can. And I am here to tell you that we are ready to help where you believe that we should. This conference, I think, provides a fantastic opportunity to think together – and for me it comes at the ideal moment – of how the International Labour Organization and the European Union can deepen their very positive relationship.

It’s a natural relationship because we share, and have shared, from the very beginning, common foundational values and principles. Mr. Somavia, the outgoing Director-General, drew attention to that in his message to you by video, and he said it at the address he made to the European Parliament in Strasburg recently.

So, we have a natural coincidence. But I think under Europe’s and the world’s circumstances, that natural partnership is now married to an urgent need. And that urgent need is to get Europe back to work. The ILO, I hope and I believe, can contribute to meeting that urgent need.

There are a number of areas where I think we can do it.

Firstly, and perhaps most controversially, the ILO has had some role, and could have a more systematic and I think a more constructive role in the EU programme countries. From the moment the sovereign debt crisis in Europe began to present very acute problems to a certain number of member states, and to make it clear that major processes of structural reform and labour market reform are on the table, I believe the ILO could have been at the table and could have been helping.

By and large, that didn’t happen. It happened somewhat after the event in the case of Greece, because our supervisory processes were triggered. And I have to tell you: on the two occasions I have been to Greece in the last 12 months, I have seen very clearly that we could have made a difference, that with ILO presence, if we were listened to, we could have made a difference.

I don’t say that we could have, of course, resolved all the problems. But I think we could have produced better outcomes than we have today, one of which is the total breakdown of social dialogue in that country, which needs to be repaired, it needs to be repaired very urgently. So we are ready there.

And let me tell you that we all need to be, I think, very aware that the predisposition to solidarity must be played out in respect of the programme countries, those countries in most difficulties, more than anywhere else. The projections of the ILO – if it takes anything else to convince you of what I am saying – is that the Greek exit from the Eurozone would push up unemployment around the Eurozone by at least 1.5 percentage points and in the case of Germany our projections show an increase by 26% in German unemployment. This is one of those situations where solidary and self-interest come into conjunction and we can draw the conclusions.

So, that’s the programme countries. It is not just Greece, but Greece is an example. Secondly, in the light of what I have said about youth guarantees and the situation of youth, I think the ILO has an obvious potential for partnership in getting youth back to work. We’ve just had a very important ILO conference discussion this June on youth unemployment globally. It is going to be a priority for my early mandate, we are there to help. Similarly with social protection floors and I could go on.

The third and last area where I want to see the ILO and the European Union working very closely together is in the global policy agenda, in the G20. We both found our seats at the G20 table. The first time the ILO sat at the G20 in Pittsburgh in 2009. I can’t say it’s a direct result, but we did achieve from the leaders in Pittsburgh the commitment to put quality jobs at the centre of the recovery process.

Pittsburgh is already a long time ago. Many things have happened in between. But I think, and it is the message of this conference, that it is time to get that commitment back at the centre, not only of the European policy making, but also of global policy making.

Let’s work together on that as well. Thank you very much.