Make Europeans work more, says economist
Europe's biggest obstacle to economic growth lies in a lack of participation in the workforce, an official at the International Monetary Fund (IMF) has said. Europe must focus on bringing young people, people over 50 years old and women into the workforce, insisted the IMF deputy director of Research, David Robinson, speaking at a conference organised by the European Commission on 20 and 21 April. 'The key to progress is at the national level,' stated Mr Robinson during the two-day forum which brought together economists and policy-makers from around the world in a bid to find ways to enhance economic growth in the EU. According to Mr Robinson, it is easy to see why Europeans have 30 percent less GDP per capita than the US. The answer lies in fewer working hours, shorter working weeks and more holiday time than US workers. All the conference speakers agreed that increased investment in both education and research and development (R&D) is needed to close the economic gap and organise the economy around a future of ever-ageing citizens sustained by fewer workers. According to former Danish Prime Minister, Poul Nyrup Rasmussen, one solution would be for each Member State to invest an additional one per cent in each area covered by the Lisbon Agenda over the next four years. Mr Rasmussen lauded the Scandinavian model where childcare costs are subsidised by the governments. 'High investment in childcare ensures high employment participation and helps the age problem by allowing people to have children and balance it with work life,' he said. For EU vice president Gunter Verheugen, the answer lies in R&D and innovation. The more research and innovation, the more competitive European companies will become in the global marketplace, believes Mr Verheugen. 'We cannot compete with China on lower wages [...] so we must be better, not necessarily cheaper [...]. We cannot have the best product if we don't invest in research and development,' he stated. As many speakers explained, an increasing amount of unskilled jobs are outsourced to countries outside the EU where labour is cheaper. This means that the market for skilled jobs will increase and it is therefore time for Europeans to prepare now to take the skilled jobs of the future. As figures presented by John Fitz Gerald of the Economic and Social Research Institute in Dublin showed, every step of education past primary level is one more step away from future unemployment. 'It is not just about increasing unskilled jobs but it is better to increase education so to lower the supply of unskilled labour,' concluded Mr Fitz Gerald.