European trade union leaders will warn Presidents Barroso, van Rompuy and Renzi that
- The EU is on the brink of a triple dip recession
- the Eurozone is on the verge of deflation
- there is a real risk of a third unemployment peak
- the way out of the crisis is to restore demand, by restoring investment
Speaking in the Tripartite Social Summit ahead of the EU Summit discussions on the economy on October 23, trade union leaders will point out that
- In the second quarter of 2014, GDP growth slowed to 1.3%, down from 1.5% in the first quarter, and below the figure for the second quarter of 2013.
- 10.1% of the EU workforce remains jobless, and in 2013 nearly one in five workers (19.5%) in the EU had a part-time job: 3 million more than in 2008, showing that the overall demand for labour shrank more than employment figures show
- Average headline inflation in September in the Eurozone is estimated at 0.3%, with Greece, Spain and Portugal already experiencing negative inflation
The European Trade Union Confederation fears that if the deflationary trend is not reversed urgently, it will have devastating consequences for the Eurozone economy, and for the highly indebted member states in particular, as their high debt burden will increase further.
- Investment has fallen more from pre-2008 levels than any other component of GDP, with dramatic declines in countries hit hardest by reductions in credit and public spending. Investment fell across the EU 2008-2013 by 21%, in Germany by 4%, Ireland 52%, Greece 56%, and Latvia 30%.
“Europe needs a major programme of investment” said Bernadette Ségol, General Secretary of the ETUC. “This means public investment to generate private investment. Juncker’s investment plan needs to deliver substantial new public money to have an impact.”
“Further labour market reforms that weaken employment and income protection would only increase economic insecurity, making households save, not spend, and pushing the European economy deeper into recession and deflation.”
