Statistics Explained

SDG 8 - Decent work and economic growth

Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all


Data extracted in April 2022.

Planned article update: June 2023.

Highlights


EU trend of SDG 8 on decent work and economic growth

This article is a part of a set of statistical articles, which are based on the Eurostat publication ’Sustainable development in the European Union — Monitoring report on progress towards the SDGs in an EU context — 2022 edition’. This report is the sixth edition of Eurostat’s series of monitoring reports on sustainable development, which provide a quantitative assessment of progress of the EU towards the SDGs in an EU context.

SDG 8 recognises the importance of sustained economic growth and high levels of economic productivity for the creation of well-paid quality jobs, as well as resource efficiency in consumption and production. It calls for opportunities for full employment and decent work for all alongside the eradication of forced labour, human trafficking and child labour, and the promotion of labour rights and safe and secure working environments.

Full article

Context

Sustainable economic growth and decent employment are vital for the development and prosperity of European countries and the well-being and personal fulfilment of individuals. For economic growth to be truly sustainable, it must be accompanied by eco-efficiency improvements, climate action and resilient measures, alongside active labour market and social inclusion policies, in order to ensure that the transition to a climate neutral economy is just and inclusive. Key to achieving this will be the generation of decent employment opportunities for all and improving working conditions for those already in employment as well as supporting citizens in their labour market transitions.

Decent work and economic growth in the EU: overview and key trends

Monitoring SDG 8 in an EU context involves looking into trends in the areas of sustainable economic growth, employment and decent work. As Table 1 shows, the EU has achieved some progress in terms of economic growth over the past few years. Despite the COVID-19 pandemic, the overall employment situation and working conditions have also improved since 2015.

Economic growth

To ensure the well-being of future generations, the EU has adopted a new growth strategy, the European Green Deal, aimed at transforming the Union into a modern, resource-efficient and competitive economy. The indicators selected to monitor this objective show that over the past few years Europeans have generally enjoyed continuous economic growth. However, the positive trend was halted in 2020 by the COVID-19 pandemic.

After a COVID-19-related drop in 2020, the EU economy grew by 5.4 % in 2021

Citizens’ living standards depend on the performance of the EU economy, which can be measured using several indicators. One of these is growth in gross domestic product (GDP). Although GDP is not a measure of welfare, it gives an indication of an economy’s potential to satisfy people’s needs and its capacity to create jobs. It can also be used to monitor economic development.

Real GDP per capita (GDP adjusted for inflation) in the EU saw strong and continuous growth of 2.0 % per year on average between 2014 and 2019, with both private consumption and investment being the key drivers of economic expansion [1]. In 2020, the economy was hit by the COVID-19 pandemic, resulting in a 6.0 % contraction of real GDP compared with 2019. Nevertheless, the economy rebounded from the recession in the following year. In 2021, the real GDP per capita reached EUR 27 810, a 5.4 % increase compared with the previous year and only slightly below 2019 levels. This growth was mostly driven by households spending [2].

Investment is another indicator of economic growth as it enhances an economy’s productive capacity. In 2020, the total investment share of GDP in the EU declined by 0.2 percentage points compared with the previous year as a result of the pandemic, reaching 22.3 %. This drop interrupted a period of steady growth in investment observed since 2014 and can be attributed to a decrease in business investment in 2020. Businesses were the biggest investor in 2020, with an investment share in GDP of 13.7 %, followed by households with 5.4 % and governments with 3.3 %. The investment share of households has been slowly growing since 2016 but still remains below the levels seen before the 2008 financial crisis. Government investment has followed a counter-cyclical pattern, increasing during both the financial crisis of 2008 and the COVID-19 crisis in 2020.

Employment

Decent employment for all — including women, people with disabilities, young people, older people and migrants — is a cornerstone of socio-economic development. Apart from generating the resources needed for decent living standards and achieving life goals, work provides opportunities for meaningful engagement in society, which promotes a sense of self-worth, purpose and social inclusion. Higher employment rates are a key condition for making societies more inclusive by reducing poverty and inequality in and between regions and social groups. The European Pillar of Social Rights Action Plan sets a target of at least 78 % of the population aged 20 to 64 to be in employment by 2030.

Following the economic recovery, the employment rate in the EU reached its peak in 2021

Prior to the COVID-19 pandemic, the EU employment rate [3] exhibited an upward trend, reaching 72.7 % in 2019. The growth over the past decade can be partly attributed to increased participation in the labour force by older workers and women [4]. In 2020, the severity of the pandemic’s socio-economic impacts was cushioned by support measures introduced by the EU and its Member States [5]. As a result, the employment rate fell by only one percentage point to 71.7 % in the first year of the pandemic. Following the economic recovery, labour market conditions in the EU improved and the employment rate went up to 73.1 % in 2021 – the highest level observed so far. If this positive trend continues, the EU will be well placed to reach its employment target of 78 % by 2030.

An analysis by degree of urbanisation reveals that employment rates in cities, towns and suburbs and rural areas were all affected by the COVID-19 crisis. The pandemic and the following economic recovery, however, did not affect the employment gap between cities and rural areas, which stood at 0.4 percentage points in 2020 and 2021, the same level as in 2019. Since 2012, the employment rate in rural areas has been slightly higher than in cities and reached 73.6 % in 2021, compared with 73.2 % in cities and 72.6 % in towns and suburbs [6].

Unemployment and long-term unemployment have decreased since 2014

The EU’s unemployment situation had also been improving before the onset of the COVID-19 pandemic. Between 2014 and 2019, the EU’s unemployment rate (age group 15–74) decreased by 4.2 percentage points, affecting 6.8 % of the population in the labour force in 2019 [7]. In the first year of the pandemic, however, the unemployment rate increased to 7.2 %, before falling back to 7.0 %, following the economic recovery in 2021. Over the past few years, city dwellers have been more affected by unemployment than those living in rural areas. In 2021, the unemployment rate in cities was 7.8 % compared with 5.9 % for rural areas [8].

Long-term unemployment usually follows the trends in unemployment, but with a delay, meaning that the effects of the COVID-19 pandemic are only visible in 2021 data. Being unemployed for a year or more can have long-lasting negative implications for individuals and society by reducing employability prospects, contributing to human capital depreciation, endangering social cohesion and increasing the risk of poverty and social exclusion. Beyond material living standards, it can also lead to a deterioration of individual skills and health, thus hindering future employability, productivity and earnings.

As a result of the COVID-19 pandemic, the long-term unemployment in the EU increased by 0.3 percentage points, reaching 2.8 % of the labour force in 2021. This was still 2.7 percentage points less than at the peak of the long-term unemployment rate in 2013 and 2014, indicating an overall positive trend. The proportion of long-term unemployment in total unemployment has also decreased over the past few years [9].

The labour market situation of young people was strongly affected by the COVID-19 crisis

The economic growth observed over the past few years has also helped to improve the labour market situation of younger people, with the employment rate of 20- to 24-year-olds growing steadily between 2014 and 2019. Nevertheless, their employment prospects remain precarious and they were hit harder by the COVID-19 crisis than older age groups. This is because young people are more likely to be employed on a temporary contract or to work in sectors affected by the restrictions placed on economic activities to tackle the pandemic, such as the service sector [10]. In 2021, only 50.6 % of people aged 20 to 24 were employed [11], compared with 73.1 % of people aged 20 to 64.

The overall low employment rate of people aged 20 to 24 can also be explained by the fact that many people at this age are still in education, and thus, are not a part of the labour force. However, in 2021 the employment rate of young people was still 2.2 percentage points lower than at its peak in 2008. Moreover, despite the strong decrease in youth unemployment since 2013, 15.2 % of 20- to 24-year-olds were unemployed in 2021, which is still significantly higher than for older age groups [12]

Young people not engaged in employment nor in education and training (NEET) are among the most vulnerable groups in the labour market. Over the long term they may fail to gain new skills and suffer from erosion of competences, which in turn might lead to a higher risk of labour market and social exclusion. To improve the labour market situation of young people, the EU set a complementary target of decreasing the NEET rate to 9 % by 2030.

Between 2004 and 2019, the NEET rate for 15- to 29-year-olds in the EU closely followed the economic cycle, improving from 15.6 % to 12.6 % over the period. As a result of the COVID-19 pandemic, however, the NEET rate increased to 13.8 % in 2020, before falling back to 13.1 % in 2021, which was still above the pre-pandemic level. This pushed the EU off-track to achieving its 2030 target of 9 %. The NEET rate in rural areas and towns and suburbs had been higher than in cities over the past few years and reached 13.9 % in towns and suburbs and 13.7 % in rural areas in 2021, compared with a rate of 12.2 % in cities [13].

Women’s participation in the labour market is growing, but gender differences persist

Over the past 12 years, the employment rate of women in the EU has been increasing. After a dip caused by the COVID-19 pandemic, the employment rate of women reached a new high of 67.7 % in 2021. The gender employment gap, however, continues to persist, despite narrowing by 2.6 percentage points since 2009. In 2021, it amounted to 10.8 percentage points, despite women increasingly becoming well qualified and even outperforming men in terms of educational attainment (see the article on SDG 4 ‘Quality education’). Women are also overrepresented in part-time work.

The impact of parenthood and caring responsibilities remains one of the main drivers of lower employment rates for women. Inflexible work-life-balance options and underdeveloped care services — both for childcare and long-term care of a family member — are major impediments to women remaining in or returning to work. In 2021, 30.2 % of women aged 20 to 64 outside the labour force were in this situation because they were caring for children or incapacitated adults, compared with only 8.5 % of men. This gender gap had widened between 2014 and 2019, reaching 26.8 percentage points in 2019, but in 2021 the trend reversed and the gap narrowed to 21.7 percentage points. Overall, the share of people aged 20 to 64 from both sexes who were outside the labour force due to caring responsibilities rose continuously between 2013 and 2019, reaching 24.8 % of the population outside of the labour force in 2019, before falling back to 21.4 % in 2021.

In 2021, caring responsibilities were also the main reason why women were opting for a part-time employment [14]. As a result, women were overrepresented in part-time employment, with 28.3 % of employed women working part-time in 2021, compared with 7.6 % of employed men [15].

Employment opportunities are lower for people with disabilities

People with disabilities are those who have a basic activity difficulty (such as seeing, hearing, walking, communicating) and/or a work limitation caused by a longstanding health condition and/or a basic activity difficulty [16]. Disabilities impact on people’s lives in many areas, including participation in the labour market. In 2020, the employment rate of people with disabilities at the EU level was 24.5 percentage points lower compared with people without disabilities. For women with disabilities, this gap was 21.6 percentage points, while for men with disabilities it was 27.0 percentage points. The degree of disability is also an important factor affecting the employment rate. At the EU level, the employment rate for people with a severe disability was 44.1 percentage points lower than for people without disability, while for people with a moderate disability the gap was 17.4 percentage points in 2020 [17].

Decent work

For a society’s sustainable economic development and well-being it is crucial that economic growth generates not just any kind of job but ‘decent’ jobs. This means that work should deliver fair income, workplace security and social protection for families, better prospects for personal development and social integration and equality of opportunity [18]

Work in the EU is becoming safer and more economically secure

A prerequisite for decent work is a safe and healthy working environment, without non-fatal and fatal accidents. Over the past few decades, the EU and its Member States have put considerable effort into ensuring minimum standards in occupational health and safety at work. In 2019, the rate of fatal accidents at work amounted to 1.7 fatalities per 100 000 employed persons, with the mining and quarrying sector being particularly prone to the risk of fatal accidents [19]. While there has been a significant decrease since 2010, a noticeable gender difference persists: in 2019, the incidence rate for women was only 0.2 per 100 000 persons, compared with 3.1 for men. This might be due to the fact that activities with the highest incidence rates are mostly male-dominated [20].

Besides safety at work, fair income and social protection are other important components of decent work. Poverty is often associated with the absence of a paid occupation but low wages can also push some workers below the poverty line. People working part-time or on temporary contracts [21], low-skilled workers and non-EU born workers are especially affected by in-work poverty. In the EU, the share of the so-called ‘working poor’ (aged 18 and over) decreased between 2016 and 2019, to 9.0 %. In 2020, however, the in-work at-risk-of-poverty rate grew again, to 9.4 % of employed people. Part of this increase can be attributed to methodological changes in the EU-SILC surveys in a couple of Member States.

Factors influencing in-work poverty rates include, among other things, type of contract, working time and hourly wages. While a fixed-term, part-time contract or platform work may provide greater flexibility for both employers and workers, it is not always a personal choice for an employee and can thus significantly influence their well-being. In 2021, 4.9 % of European employees aged 20 to 64 were involuntarily working on temporary contracts, corresponding to 37.5 % of all temporary employees. This share has decreased over the past few years [22]. Similar to involuntary temporary employment, the share of involuntary part-time employment in total employment in the EU also decreased, from 5.6 % in 2016 to 4.1 % in 2021 [23].


Presentation of the main indicators


Real GDP

Real GDP per capita evaluation 2022.png

Gross domestic product (GDP) is a measure of economic activity and is often used as a proxy for changes in a country’s material living standards. It refers to the value of total final output of goods and services produced by an economy within a certain time period. Real GDP per capita is calculated as the ratio of real GDP (GDP adjusted for inflation) to the average population of the same year and is based on rounded figures.

Figure 1: Real GDP per capita, EU, 2000-2021 (EUR per capita, chain-linked volumes, 2010)
Compound annual growth rate (CAGR): 0.8 % per year in the period 2006–2021; 1.0 % per year in the period 2016–2021.
Source: Eurostat (sdg_08_10)


Figure 2: Change in real GDP per capita, by country, 2016-2021 (average annual growth rate in %)
Source: Eurostat (sdg_08_10)

Investment share of GDP

Investment share of GDP evaluation 2022.png

The investment share of GDP measures gross fixed capital formation (GFCF) for the total economy, government and business, as well as household sectors as a percentage of GDP.

Figure 3: Investment share of GDP, by institutional sectors, EU, 2002-2020 (% of GDP)
Compound annual growth rate (CAGR) for total investment: – 0.02 % per year in the period 2005–2020; 1.7 % per year in the period 2015–2020.
Source: Eurostat (sdg_08_11)


Figure 4: Investment share of GDP, by country, 2015 and 2020 (% of GDP)
Source: Eurostat (sdg_08_11)


Young people neither in employment nor in education and training (NEET)

Young people neither in employment nor in education and training (NEET) evaluation 2022.png

A considerable proportion of young people aged 15 to 29 in the EU are not a part of the labour force. For some this is due to the pursuit of education and training. Others, however, have withdrawn from the labour market or are not entering it after leaving the education system. Those who struggle with the transition from education to work are captured by the statistics on young people who are neither in employment (i.e. economically inactive or unemployed), education nor training (NEET rate). Data presented in this section stem from the EU Labour Force Survey (EU-LFS).

Figure 5: Young people neither in employment nor in education and training (NEET), by sex, EU, 2002-2021 (% of population aged 15 to 29)
Compound annual growth rate (CAGR) for the total: – 0.4 % per year (observed) and – 1.9 % per year (required to meet target) in the period 2006–2021; – 1.9 % % per year (observed) and – 3.3 % per year (required to meet target) in the period 2016–2021.
Source: Eurostat (sdg_08_20)


Figure 6: Young people neither in employment nor in education and training (NEET), by country, 2016 and 2021 (% of population aged 15 to 29)
Source: Eurostat (sdg_08_20)


Employment rate

Employment rate evaluation 2022.png

The employment rate is defined as the percentage of employed persons in relation to the comparable total population. The data analysed here focus on the population aged 20 to 64. Employed persons are defined as all persons who, during a reference week, worked at least one hour for pay or profit or were temporarily absent from such work. Data presented in this section stem from the EU Labour Force Survey (EU-LFS).

Figure 7: Employment rate, by sex, EU, 2009-2021 (% of population aged 20 to 64)
Compound annual growth rate (CAGR) for the total: 0.7 % per year (observed) and 0.7 % per year (required to meet target) in the period 2009–2021; 1.0 % per year (observed) and 0.8 % per year (required to meet target) in the period 2016–2021.
Source: Eurostat (sdg_08_30)


Figure 8: Employment rate, by country, 2016 and 2021 (% of population aged 20 to 64)
Source: Eurostat (sdg_08_30)


Map 1: Employment rate, by NUTS 2 regions, 2021 (% of population aged 20 to 64)
Source: Eurostat (lfst_r_lfe2emprt)


Long-term unemployment rate

Long-term unemployment rate evaluation 2022.png

Long-term unemployment is measured for the population in the labour force (which includes both employed and unemployed people) aged 15 to 74 who have been unemployed for 12 months or more. Long-term unemployment increases the risk of inactivity and falling into poverty and has negative implications for society as a whole. People in the EU who are long-term unemployed have about half the chance of finding employment as those who are short-term unemployed [24]. Data presented in this section stem from the EU Labour Force Survey (EU-LFS).

Figure 9: Long-term unemployment rate, by sex, EU, 2009-2021 % of population in the labour force)
Compound annual growth rate (CAGR) for the total: – 0.8 % per year in the period 2009–2021; – 8.2 % per year in the period 2016–2021.
Source: Eurostat (sdg_08_40)


Figure 10: Long-term unemployment rate, by country, 2016 and 2021 (% of population in the labour force)
Source: Eurostat (sdg_08_40)


Fatal accidents at work

Fatal accidents at work evaluation 2022.png

Fatal accidents at work are those occurring during the course of employment and leading to the death of the victim within one year; commuting accidents occurring between the home and the workplace are excluded. The incidence rate refers to the number of accidents per 100 000 persons in employment. Data presented in this section are collected in the framework of the administrative data collection 'European Statistics on Accidents at Work (ESAW)[25]. As an exception, fatal road traffic accidents at work are not included in the data from the Netherlands.

Figure 11: Fatal accidents at work, EU, 2010-2019 (number per 100 000 workers)
Compound annual growth rate (CAGR) for the total: – 2.7 % per year in the period 2014–2019
Source: Eurostat (sdg_08_60)


Figure 12: Fatal accidents at work, by country, 2014 and 2019 (number per 100 000 workers)
Source: Eurostat (sdg_08_60)

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More detailed information on EU SDG indicators for monitoring of progress towards the UN Sustainable Development Goals (SDGs), such as indicator relevance, definitions, methodological notes, background and potential linkages, can be found in the introduction of the publication ’Sustainable development in the European Union — Monitoring report on progress towards the SDGs in an EU context — 2022 edition’.

Notes

  1. European Commission (2020), Employment and Social Developments in Europe 2020, Publications Office of the European Union, Luxembourg, p. 22.
  2. European Commission (2021), European Economic Forecast, Winter 2022, Publications Office of the European Union, Luxembourg, p. 8.
  3. Due to the entry into force of Regulation 2019/1700 on 1 January 2021, there is a break in the LFS data series between 2020 and 2021 for most countries. Correction input (which can be correction factors or corrected LFS indicators) has been sent by countries to Eurostat, which has been used to break-correct some of the LFS time series, while some others have not been corrected. Accordingly, data on total and female/male employment rate, as well as (long-term) unemployment use break-corrected data for the years 2009 to 2020, based directly on the correction input received from countries. Data on employment by degree of urbanisation and employment by NUTS use raw data received before 2021, i.e. non break-corrected data. Data on part-time employment use break-corrected data based, for most countries, on derivations done by Eurostat using the correction input received from countries (derived indicators).
  4. European Commission (2017), Employment and Social Developments in Europe 2017, Publications Office of the European Union, Luxembourg, p. 10.
  5. European Commission (2021), Proposal for a Joint Employment Report from the Commission and the Council, COM(2021) 743 final, Brussels.
  6. Source: Eurostat (online data code: (lfst_r_ergau)).
  7. Source: Eurostat (online data code: (une_rt_a)).
  8. Source: Eurostat (online data code: (lfst_r_urgau)).
  9. European Commission (2020), Employment and Social Developments in Europe 2020, Publications Office of the European Union, Luxembourg, p. 29.
  10. Fana, M., Tolan, S., Torrejón, S., Urzi Brancati, C., Fernández-Macías, E (2020), The COVID confinement measures and EU labour markets, Publications Office of the European Union, Luxembourg.
  11. Source: Eurostat (online data code: (lfsa_ergan)).
  12. Source: Eurostat (online data code: (lfsa_urgaed)).
  13. Source: Eurostat (online data code: (edat_lfse_29)).
  14. Source: Eurostat (online data code: (lfsa_epgar)).
  15. Source: Eurostat (online data code: (lfsa_epgaed)).
  16. Eurostat, Prevalence of disability (source LFS).
  17. Source: Eurostat (online data code: (hlth_dlm200)).
  18. International Labour Organisation (2022), Decent work.
  19. Eurostat (hsw_n2_02)
  20. Eurostat (2022), Statistics Explained: Accidents at work - statistics by economic activity.
  21. European Commission (2020), Joint Employment Report 2020, Directorate-General for Employment, Social Affairs and Inclusion, Brussels, p. 11.
  22. Eurostat (lfsa_etgar).
  23. Eurostat (lfsa_epgar) and (lfsa_epgaed).
  24. European Commission (2016), Employment and Social Developments in Europe 2015, Publications Office of the European Union, Luxembourg, p. 13.
  25. Eurostat (2013), European Statistics on Accidents at Work (ESAW) - Summary methodology, Publications Office of the European Union, Luxembourg.