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In-work poverty and labour market segmentation in the EU

04/02/2011 In-work poverty and labour market segmentation in the EU

In-work poverty and labour market segmentation need to be taken into account more strongly in the EU’s strategy to tackle poverty and social exclusion in the future.

17 million workers in the EU are poor; they represent 15% of the 120 million people included in the new Europe 2020 social inclusion target. In-work poverty is, therefore, likely to become a more important issue in the future.

The European Commission has published an expert report that analysis in-work poverty and labour market segmentation and suggests how progress can be made on this issue.

It shows important variations in the scale on in-work poverty across the EU. According to national experts, these differences can be explained by structural differences in economies and the extent of labour market segmentation. However, the extent to which Member States intervene both to limit and regulate the amount of labour market segmentation and specifically to alleviate its worst effects (through minimum wage, tax and social protection policies) plays a very significant role.

Based on the analysis of the experts and the examples of countries that have implemented successful policies, the report concludes that progress needs to be made in four main areas:

  • raising public awareness and political priority;
  • enhancing data and analysis;
  • improving monitoring and reporting; and
  • enhancing the mainstreaming of social inclusion goals in economic and employment policies.

A synthesis report is based on a series of national report drafted by the Network of Independent Experts in the field of Social Inclusion commissioned to assist the European Commission in the monitoring of social inclusion policies. It is also intended as a contribution to the monitoring of the EU “Active Inclusion” process, which was launched at the end of 2008 and which is a crucial part of the EU’s fight against poverty and social exclusion.

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