- Rent outstrips the minimum wage: In most EU capitals, the cost of renting a modest flat now exceeds what a minimum-wage worker earns in a month, while families face a €1,800 rise in energy bills.
- The CEOs’ prescription has failed: Labour shortages stem from low pay and poor conditions, skills gaps from a failure to invest in training, and weak productivity from decades of profits siphoned off rather than reinvested.
- Bad jobs corrode democracy: Workers who are poorly paid, badly treated, and voiceless at work are more likely to turn against democracy, creating the conditions in which the far right and anti-EU sentiment thrive.
- Public money must buy quality: With more than €2 trillion spent annually through public contracts, awarding them to the lowest bidder entrenches precarious work when it should be creating high-quality jobs and services.
- EU Inc transfers risk, not competitiveness: The 28th-regime initiative threatens national labour law and collective agreements, shifting risk from capital to workers while the Draghi report’s €800 billion investment call goes unheeded.
Ask anyone in Europe what the “state of the Union” is today and the answer will be about rent, energy bills, wages that are not keeping pace with prices, fears of job loss, and the uncertain future facing young people.
Despite the fact that the EU’s own polling consistently shows the cost of living to be citizens’ top concern, the likelihood is that the State of the Union address will spend all its political capital on a war economy and on trying to manufacture competitiveness through deregulation, notably by stripping away workers’ rights through the “EU Inc” initiative and the ongoing fleet of Omnibus proposals.
The State of the Union address sends an unmistakable signal about whose interests the EU is focused on. That is why President von der Leyen should use this year’s speech to address working people. She should lead with jobs: how the EU is going to create more quality jobs, with wages you can live on and rights you can rely on, alongside serious measures to counteract the crippling cost of living. These are not side issues. They are the test by which working people will judge this Commission, and the benefit of the EU itself.
President von der Leyen needs to speak to the mum working two jobs just to pay the rent, which now often exceeds the monthly minimum wage. To the families facing a €1,800 increase in their energy bills this year. To the thousands of manufacturing workers facing redundancy with no alternative employment in sight. To the young workers unable to find any work at all despite being well qualified.
The speech must not treat workers as some footnote to competitiveness. It must set out how the EU is going to help Europe’s workers, their families, and their communities with a pathway to success. Europe’s cohesion will not be sustained by how many tech start-ups it can count. It is sustained by communities that can see a future for their children, and by industrial regions that are not simply told to “adapt” while their local industry and economy collapse or their public services are cut back.
Deregulation Is the Opposite of Common Sense
That is not just the right thing to do by people; it is the way to build a genuinely competitive economy. The evidence shows that the CEOs’ prescription for competitiveness has already failed. The labour shortage has been badly exacerbated by low pay and poor conditions. The skills shortage has been caused by a failure to invest in training for workers. And productivity is low because CEOs have for decades siphoned off profits rather than reinvesting them. Deregulation is the opposite of common sense, and EU leaders need to stop handing an alibi to CEOs who blame workers, or their rights, for company failures.
Europe will not win a race to the bottom. Our path to competitiveness lies in high skills, high standards, and high-quality jobs; in a strong manufacturing base, a vibrant services sector, and thriving next-generation agriculture; and in the fundamental underpinning of public services.
The Commission has taken some steps in the right direction by recognising that investment should create quality jobs in Europe. Bringing forward the Quality Jobs Act and the Public Procurement Act will demonstrate whether the EU has a common-sense approach to delivering for working people.
We need to end the explosion of precarious work, including through the opaque subcontracting chains so easily exploited by criminal gangs, and rebuild secure, well-paid jobs covered by collective bargaining, on which people can build a life. Our European Social Model is the foundation of our future success.
That would not only improve the lives of workers and make the economy more competitive; it would strengthen democracy, because bad jobs and unenforceable rights have created the conditions for the far right to thrive and anti-EU sentiment to build. Research shows that workers who are poorly paid, work under tough conditions, and have little say in their work are more likely to hold negative attitudes towards democracy, while good jobs can reverse the trend.
Where the Public Money Goes
Europe needs to invest in social cohesion now more than ever. And yet the European Social Fund faces the axe under the next long-term budget. Public services, housing, and social spending are being treated as unaffordable while money is funnelled towards the defence industry and blank cheques are written to private capital.
How public money is spent is crucial. More than €2 trillion is spent every year through public contracts: money that should be spent in the public interest, creating high-quality jobs and high-quality services. Instead, most contracts are currently awarded to the lowest bidder, fuelling precarious work and low pay.
Ensuring public money is used effectively is all the more crucial at a time when the Draghi report says Europe needs to increase investment by more than €800 billion to catch up with its competitors. That part of the report has been overlooked in favour of competitiveness built on deregulation and a race to loosen labour standards, notably through the EU Inc initiative, which risks undermining national labour law, all collective agreements, and the European Social Model. This, however, is not competitiveness at all, just a transfer of risk from capital to workers. It is not common sense, whatever some may claim.
