Archive:Labour market policy interventions
- Data from September 2012, most recent data: Further Eurostat information, Main tables and Database.
Labour market policy (LMP) interventions are generally targeted at providing assistance to the unemployed and other groups of people who face particular difficulties to enter the labour market. In most EU Member States the primary target group is people who are registered as unemployed by national public employment services or who are currently employed but at risk of involuntary job loss due to difficult economic circumstances for their employer – a situation that is particularly relevant in the current recovery from the economic crisis.
However, policy objectives aimed at increasing participation in the labour market are increasingly focused on a broader range of persons who are not formally unemployed but are often facing disadvantages and barriers that may prevent them from joining or re-joining the labour force – for example, women re-entering work after a family break, young people looking for their first job, older workers and disabled workers. Therefore, people currently considered as inactive but who would like to enter the labour market are also treated as an important LMP target group. As a result, the types of intervention used, and the groups that are targeted, vary between Member States depending on national circumstances and priorities.
Main statistical findings
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Across the EU-27, a total of 2.2 % of gross domestic product (GDP) was spent on LMP interventions in 2010 (see Figure 1), almost the same as in 2009 when there was a dramatic rise in total LMP expenditure (34% higher than in 2008), which mainly derived from higher levels of expenditure on unemployment benefits as a consequence of the financial and economic crisis. The latest data show that the increased level of expenditure was sustained in 2010 but not extended, despite the fact that the number of unemployed grew by a further 7.7% between 2009 and 2010.
Within the EU Member States, the highest relative level of expenditure on LMP interventions in 2010 was reported in Ireland (3.9 % of GDP), followed by Spain, Belgium and Denmark, which were the only other countries to spend more than 3.0 % of their GDP on such interventions. At the other end of the scale, nine Member States spent less than 1 % of GDP on these interventions: Slovakia, Greece (2009 data), Cyprus, Lithuania, the Czech Republic, the United Kingdom (2009 data), Romania, Bulgaria and Malta. Relative to GDP, Spain spent the most on LMP supports (3.1 %) with Belgium and Ireland the only other countries to spend more than 2 %. Belgium and Denmark spent most on LMP measures (1.3% and 1.4 % of GDP respectively) while Sweden and the Netherlands reported the highest relative expenditure on LMP services (0.5 % and 0.4% of GDP respectively).
In 2010, the majority of EU-27 expenditure on LMP interventions financed LMP supports (62.9 %) whilst just over a quarter (25.7%) was spent on LMP measures and the remaining ninth (11.4%) on LMP services. The level of expenditure and the breakdown of both expenditure and participants between the different types of LMP intervention varied considerably between Member States, reflecting the diverse characteristics and problems within national labour markets, as well as the different political convictions of their respective governments.
LMP measures mostly support the transition from unemployment or inactivity into employment, either: by improving employability through training or work experience; by providing incentives for employers to take on people from selected target groups; or by encouraging individuals to become self-employed. Total public expenditure on LMP measures across the EU-27 in 2010 was equivalent to 0.6 % of GDP. The largest part of this expenditure (see Figure 2) went on training (39.1 %), just over a quarter (25.1 %) on employment incentives, while 14.2 % was accounted for by supported employment and rehabilitation (measures that promote the labour market integration of people with reduced working capacity) and 13.4 % by direct job creation (which covers the provision of temporary jobs that are additional to normal market supply).
Across the EU-27 there was an average of 10.7 million people participating in LMP measures at any point during 2010 (see Table 1), slightly fewer than in 2009 (11.1 million). Meanwhile, the average number of people benefitting from LMP supports at any point in the year fell slightly from 18.2 million in 2009 to 17.7 million in 2010 but remains well above the numbers assisted in 2008, which averaged 13.3 million.
Data sources and availability
Source statistics
All data presented in this article were extracted from the Eurostat LMP database in September 2012. Data are collected annually from administrative sources in each country.
Scope of LMP statistics
LMP statistics cover all labour market interventions which can be described as ’public interventions in the labour market aimed at reaching its efficient functioning and correcting disequilibria and which can be distinguished from other general employment policy interventions in that they act selectively to favour particular groups in the labour market’. The scope of LMP statistics is limited to public interventions that explicitly target groups with difficulties in the labour market; this includes the unemployed, those employed but at risk of involuntary job loss, and people who are currently inactive in the labour market but would like to work.
Types of interventions
LMP interventions are classified into three main types:
- LMP services refer to labour market interventions where the main activity of participants is job-search related and where participation usually does not result in a change in labour market status.
- LMP measures refer to labour market interventions where the main activity of participants is not job-search related and where participation usually results in a change of labour market status. In other words, a person who is unemployed typically ceases to be considered as such when participating in an LMP measure because they are temporarily in training or work and therefore not both actively seeking and immediately available for work. An activity that does not result in a change of labour market status may still be considered as a measure if the intervention fulfils the following criteria:
- the activities undertaken are not job-search related, are supervised and constitute a full-time or significant part-time activity of participants during a significant period of time, and;
- the aim is to improve the vocational qualifications of participants, or;
- the intervention provides incentives to take-up or to provide employment (including self-employment).
- LMP supports refer to interventions that provide financial assistance, directly or indirectly, to individuals for labour market reasons, or which compensate individuals for disadvantage caused by labour market circumstances.
Additional category breakdowns
The three main types of intervention are further broken down into nine detailed categories according to the type of action:
- LMP services
- 1. Labour market services;
- LMP measures
- 2. Training;
- 3. Job rotation and job sharing;
- 4. Employment incentives;
- 5. Supported employment and rehabilitation;
- 6. Direct job creation;
- 7. Start-up incentives;
- LMP supports
- 8. Out-of-work income maintenance and support;
- 9. Early retirement.
The LMP methodology provides guidelines for the collection of data on LMP interventions: which interventions to cover; how to classify interventions by type of action; how to measure the expenditure associated with each intervention; and how to measure the number of participants in each intervention using observations of stocks and flows (entrants and exits).
Context
The LMP data collection was developed by the European Commission as an instrument to monitor the implementation and development of targeted employment policies across the EU in response to two agreements of the European Council in 1997. The first, held in Amsterdam in June 1997, confirmed that whilst employment policy should be a national responsibility, it was also an issue of common concern and that there should be a coordinated strategy at a European level. The second, held in November 1997 in Luxembourg – the so-called ’Jobs Summit’ – launched the European Employment Strategy (EES) in which LMPs had a key role in relation to employability. Since that time, LMP statistics have been used to monitor both active and passive interventions in the labour market and, in particular, relevant areas of the EU Employment Guidelines.
More recently, LMP statistics are used as one of the sources of data for monitoring the EU Employment Guidelines through the Europe 2020 Joint Assessment Framework (JAF). The JAF is an indicator-based assessment system developed and used by the European Commission and the Employment Committee. Organised in 12 Policy Areas, the JAF includes a series of indicators used to monitor the progress towards EU headline targets and associated national targets in relation to the implementation of the Employment Guidelines. Data from the Eurostat LMP database are used to calculate indicators in Policy Area 3 related to Active labour market policies and Policy Area 4 related to Adequate and employment oriented social security systems. The latest values for all LMP indicators are available in the Eurostat online database.
Further Eurostat information
Publications
- Labour market policy - Expenditure and participants - Data 2010
- Labour market policy expenditure fell by more than 14% in real terms between 2005 and 2008 - Statistics in focus 66/2010
Main tables
- Labour market policy
- Main tables
- Labour market policy (t_lmp)
- Public expenditure on labour market policies, by type of action (tps00076)
- Public expenditure on labour market policy measures, by type of action (tps00077)
- Public expenditure on labour market policy supports, by type of action (tps00078)
- Participants in labour market policy measures, by type of action (tps00079)
- Beneficiaries of labour market policy supports, by type of action (tps00080)
- Persons registered with Public Employment Services (tps00081)
- Labour market policy (t_lmp)
- Main tables
Database
- Labour market policy
- Database
- Labour market policy (lmp)
- Public expenditure on labour market policy (LMP) interventions (lmp_expend)
- Participants in labour market policy (LMP) interventions (lmp_particip)
- LMP based indicators for monitoring the Employment Guidelines (lmp_indic)
- Persons registered with Public Employment Services (PES) (lmp_rjru)
- Labour market policy (lmp)
- Database
Methodology/Metadata
- Labour market policy [ESMS metadata file - lmp_esms]
- Labour market policy database – Methodology – Revision of June 2006
- Addendum to the 2006 LMP methodology, March 2009, see Dedicated section: Labour market policy
Source data for tables and figures (MS Excel)
Other information
External links
- European Commission - Employment and Social Affairs - Employment Strategy
- Employment Committee – opinions and other working documents
- OECD - Active labour market policies and activation strategies