European labour market policy

The "Europe 2020" growth strategy

"Europe 2020" is the European Union's ten-year growth strategy in the economic, social and sustainability fields: in the economic and social field, the "Europe 2020 Strategy". The European Commission presented the current Europe 2020 growth strategy on 3 March 2010.

Three key elements are realised via specific measures at EU level and at the level of the Member States:

• Intelligent growth (the promotion of knowledge, innovation and education as well as a digital society, and
• sustainable growth (more resource-efficient production with a simultaneous increase in competitivity;
• inclusive growth (increase of the employment rate, skills, and combating poverty).

The Member States report on the measures they have taken and if necessary receive recommendations from the Council on the basis of the annual audit by the Commission.

The European Semester

The European Semester for the coordination of economic policy was introduced in 2011 as part of the Europe 2020 strategy. Its goal is to examine national budget and reform proposals before they are adopted by the national parliaments. The main objective of the European Semester is to ensure national budget discipline and a more productive economy. 

As part of the European Semester, progress in the following three areas is examined:

• Macro-economic factors
• Growth-promoting structural reforms (coordination of the themes)
• Public finances (stricter fiscal monitoring)

The European Semester acts on a six-monthly basis, hence the name. Important points are the presentation of the Annual Growth Survey, taking stock of the progress achieved, the presentation of the stability and convergence programmes (medium-term budget strategy) of the Member States as well as their national reform programmes. 

Each of the 27 EU Member States is obliged, firstly, to report annually on the progress made in implementing the priorities and measures at national level and, secondly, to draw up national reform programmes. On the basis of these progress plans, the European Commission can make country-specific recommendations regarding measures still needed (e.g. recommendations on employment policy, framework conditions for businesses, ...).

Austria's current National Reform Programme can be found on the website of the Federal Chancellery (see external links).

On the basis of the Commission’s assessment, the June Council meeting gives the Member States country-specific recommendations. If the latter are not implemented punctually, political warnings can follow. In the case of excessive imbalances, incentives can be given and sanctions issued.

Insertion of the Structure and Resilience Facility

With the Structure and Resilience Facility, another element has been added to the Semester process. The facility entered into force on 19 February 2021 and is the core of NextGenerationEU, the EU's temporary reconstruction instrument to emerge stronger from the coronavirus crisis.

In total, €672.5 billion (figures adjusted for inflation at 2018 prices) will be available to member states through this instrument over the period 2021-2026 in the form of non-repayable grants (€312.5 billion) and loans (€360 billion).

The European Semester monitors the implementation of the Recovery and Resilience Facility in the member states in order to achieve the agreed targets, advance necessary structural reforms, increase the resilience of EU economies and invest in the environmental and digital transformation.

Twice a year, member states must report on the progress of measures and achievement of milestones. Disbursements from the Build and Resilience Facility are performance-linked and will only be approved by the European Commission if the milestones have been achieved as agreed.

There is more information on the current results of the European Semester on the website of the European Commission.