Newspaper article The Christian Science Monitor

Europe Looks to US for Tips on Training, Hiring, Firing, and Pay Scales JOBLESS DILEMMA

Newspaper article The Christian Science Monitor

Europe Looks to US for Tips on Training, Hiring, Firing, and Pay Scales JOBLESS DILEMMA

Article excerpt

THOUGH fractured by nagging political and monetary differences, the 12-nation European Union is remarkably in accord when it comes to identifying its most pressing problem: generating job opportunities for a society fast-approaching economic despair.

Registering 20-million-plus unemployed and a past decade of marginal job growth, European leaders expect that President Clinton's international jobs summit - scheduled for this March in Washington - will be a time for them to show their determination to reverse the decline.

They will also come seeking advice on a host of issues that United States public- and private-sector leaders are already engaged in, such as youth and urban unemployment, job training, flexibility in hiring and firing, hours and pay scales for workers, and beefing up small and mid-sized firms.

"Our diagnosis of our problems is largely complete {and} we are now looking for prescriptions," says Pascal Lamy, chief of the Cabinet of EU President Jacques Delors. Mr. Lamy was a principal architect of the EU White Paper on employment, which calls for "changes in economic and social policies" to combat deterioration in Europe's competitive position in employment, share of export markets, research and development, and establishing new products.

By all accounts, Europe's chief challenge is to reduce welfare costs that strangle job creation. Its economies are tangled in safety nets that were originally designed to ensure "social fairness" by providing a government-guaranteed network of health care, unemployment benefits, and social security benefits. But governments buckling under huge budget deficits and employers who pay high "social costs" on top of wages, no longer have the financial strength to afford these costs.

Zygmunt Tyszkiewicz, secretary general of UNICE, a confederation of Europe's largest employer unions, says he is worried about the "delocalization of industry." Runaway "social costs and minimum wage requirements," he says, are causing a migration of investment capital from Europe to countries like China, where labor costs are 0.5 percent of the costs in Germany.

But Mr. Tyszkiewicz says he is also irked by other government policies that impinge on job creation in the long run. "Subsidies for ailing or uncompetitive industries should be removed and channeled into something new that regenerates economies," he says. "Money going to prop up coal or wine growers could be used to encourage firms of the future, by funding education and research and development."

France, where the unemployment rate is 12 percent (as in other European countries, unofficial figures put the jobless rate much higher), is riddled with European-style problems that hinder job creation.

In Paris, government officials groan about high social charges, worker-training programs that fail to bridge the education system's "distance from actual demands of business," protectionist policies resulting in inefficient companies that cannot compete globally, and insufficient help for the small and medium-sized firms. …

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