The emergence of a New European Labour Policy regime: Continuity and change since the euro crisis

Abstract

The architecture of European labour policy has changed in the past years of the euro crisis and its management. While in the pre-crisis phase EU labour policy still had a mainly symbolic character, the EU crisis management gave it a much more binding character. The article analyses the continuities and shifts in European labour policy against the background of austerity and crisis policy arguing that a new labour policy complex was able to emerge at the European level. While institutional shifts were considerable, the market-liberal orientation of labour policy remained in place. However, it was radicalized with the resilience approach. The article therefore provides an overview of the continuity and change of European labour policy in the euro crisis on the basis of institutional and discursive shifts.

Reconsidering the drivers of country-specific recommendations: The Commission's ideological preferences on wage policies

“…Zeitlin and Vanhercke (2018) have found evidence for a socialization of the European Semester, lending credence to the Juncker Commission's claim of aspiring for ‘a more social Europe’. This is in contrast with the findings of other researchers (Copeland and Daly, 2018; Syrovatka, 2021a) who instead find that the policy recommendations of the Commission, as articulated in the Semester, veer in favor of market liberalization and a commodification of labour relations. More closely related to the topic investigated here, existing research on the Semester has focused on examining the determinants of CSRs in different policy areas.…”

“…First, because a greater monitoring of wage developments at the European level is not only recognized as important for the economic resilience of the Eurozone, but also because the Commission is playing an increasingly important role in the regulation of member states' labour markets. Recent initiatives such as the support and expansion of short-time work schemes or the proposal for the introduction of a directive on fair and adequate minimum wages across the EU are symptomatic of the Commission's increased willingness to intervene and promote greater coordination between member states' labour market policies (Syrovatka, 2021a). Second, while the mechanisms through which CSRs are implemented in national reforms programs constitute a promising avenue of further research (Guardiancich and Guidi, 2020;Mariotto, 2022), investigations into this area have shown that also non-binding CSRs on policy fields that are not within the remit of the EU's competences can have important consequences for member states' domestic policy agendas (Syrovatka, 2021b).…”

“…Consequently, the policy solutions to economic contractions prioritized lower wage growth and decreases in unit labour costs. In the context of the aftermath of the crisis, price competitiveness and wage development policies became central in the articulation of the Commission's policy recommendations (Syrovatka, 2021a).…”

“…This was seen as fundamental in order to achieve established competitiveness targets. Consequently, wage developments and the harmonization of member states’ labour markets were perceived as important mechanisms by which the imbalances of the Eurozone crisis could be redressed (Copeland and Daly, 2018; Syrovatka, 2021a). Moreover, during the crisis, the notion of competitiveness played a key role in justifying recommendations on labour market and wage-setting reforms.…”

“…First, from a legal standpoint, the issuing of recommendations is justified in different ways; those which find their legal bases in the Stability and Growth Pact (SGP) and the Macroeconomic Imbalance Procedure (MIP) are considered binding. While the Commission has thus far refrained from doing so, it is important to note that non-compliance to recommendations grounded in the SGP and MIP might lead the Commission to levy fines (Syrovatka, 2021a). Furthermore, recommendations favoring social retrenchment and wage restraint over social investment are more likely to be based in what Crespy and Vanheuverzwijn (2016) describe in their analysis as more ‘solid legal foundations’.…”