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Employment and Social Developments: Women paid less, youth lack the right skills
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The UK has one of the highest gender pay gaps in Europe and a high rate of under-skilled employees, almost double the European average. These and more are the findings of the 2012 edition of the European Commission's Employment and Social Developments in Europe Review.

"2012 has been another very bad year for Europe in terms of unemployment and the deteriorating social situation", commented European Commissioner for Employment, Social Affairs and Inclusion László Andor. "But our analysis shows how appropriate labour market reforms and improvements in the design of welfare systems can increase Member States' resilience to economic shocks and facilitate faster exit from the crisis. Moreover, it is unlikely that Europe will see much socio-economic improvement in 2013 unless it achieves greater progress also on credibly resolving the euro crisis, finding resources for much needed investment, including in people’s skills, employability and social inclusion and in making finance work for the real economy."

    Employment and Social Developments: Women paid less, youth lack the right skills

    Gender pay gap

    A large pay gap between men and women persists (16.4 per cent  on average in the EU in 2010) and tends to increase with a person’s age. In the UK the gender pay gap is one of the highest in Europe at approximately 27 per cent. Minimum wages can set a floor to ensure that the pay gap with other wage earners (especially men) can be tempered in a way that strengthens social cohesion. The negative correlation between the minimum wage and the gender pay gap in the EU Member States in 2010 seems to indicate that minimum wages help reduce the gender pay gap.


    The report's analysis shows that in some countries, the match between skills and jobs is bad and/or has worsened. Compared to the EU average of 21 per cent  of ordinary under-qualified employees, the UK percentage is considerably higher at 28 per cent  and nearly double in the case of severely under-qualified employees (severely mismatched if their qualification level is more than one step away from the required qualification in their job) at 15 per cent  where the European average is only 8 per cent .

    This problem is particularly acute for the high and still growing number of young people who are unemployed or not in any form of education or training (NEETs). The EU average has been steadily increasing since 2008 and reached 12.9 per cent in 2011. The same is true for the UK whose NEET percentage has been rising since 2005 and has reached 14.3 per cent in 2011.

    To reduce the skills mismatch, countries need to invest more efficiently in education and training, spend better on active labour market policies and support the creation of high skilled jobs in growth sectors such as the green economy and technology, information and communications technologies and healthcare.

    The recently-released EU Skills Panorama details where there is demand for workers with all levels of skills. In the UK, hard-to-fill vacancies are in elementary occupations, such as bar staff or cleaners, these recruitment difficulties are most likely due to a lack of interest in that type of work or because the roles involve shift work or unsociable hours. Those vacancies in the UK which remain unfilled due to a lack of potential recruits with the right skills are concentrated in the Business Services sector (26 per cent of all these "skill-shortage vacancies" were in this sector). Agriculture, Manufacturing, and Community, Social and Personal Services stand out as other sectors where employers tend to have more difficulties finding people with the right skills when they are seeking to recruit.

    Growing eurozone divergence

    The average EU unemployment rate climbed to almost 11 per cent . The report confirms a new pattern of divergence, which is most striking between the North and the South of the eurozone. The unemployment rate gap between these two areas was 3.5 points in 2000, fell to zero in 2007 but then has widened fast to 7.5 points in 2011. Outside the eurozone the divergence, though also growing, is significantly smaller.

    Declining household incomes, long-term exclusion risks

    Risks of entering and escaping poverty vary greatly across Member States. Some population groups are affected more: young adults, unemployed women and single mothers are among those facing higher risks of persistent poverty. In the UK, the percentage of the population at risk of poverty has decreased slightly to 22.7 in 2011 from 2010's 23.1 per cent.

    Real gross household disposable income declined between 2009 and 2011 in two-thirds of EU countries for which data is available, with the largest drops recorded in Greece (17 per cent), Spain (8 per cent), Cyprus (7 per cent) and Estonia and Ireland (5 per cent) with UK dropping by less than 1 per cent . This evolution is in stark contrast with the situation observed in the Nordic countries, Germany, Poland and France where welfare systems and more resilient labour markets have allowed overall incomes to continue increasing during the crisis. To prevent rising poverty and long-term exclusion from becoming entrenched, policies need to be tailored to specific country situations and population groups most at risk.


    For more information, please contact the London press office on 020 7973 1971.
    Please note: all amounts expressed in sterling are for information purposes only.


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    Last update: 21/08/2013  |Top