ABSTRACT
The debate about European labour market policy has shifted away from preoccupation with the harmonisation of worker rights and labour market regulations which characterised the 1980s towards the battle against unemployment and the controversy over labour market flexibility. The outcome of this debate is viewed by many as the key to improved competitiveness and ultimately to the creation of more jobs. The labour market flexibility issue is not new. Indeed it was a fundamental element of the former UK Conservative government’s opposition to the EU’s social dimension. However, it would be too simplistic to claim that the current emphasis on labour market flexibility represents the imminent dismantling of worker rights. Certainly, the 1990s have seen the growth of fears throughout Europe that unemployment is increasingly a structural phenomenon arising from the introduction of advanced technologies and the competitive consequences of globalisation. The 1980s and 1990s have also seen the spread and triumph of neo-liberal economics, resulting in a shift of policy from direct market intervention to enhancing the environment within which enterprises operate. Nevertheless, although there is an emerging consensus that labour market flexibility is about enabling labour markets to operate more efficiently, agreement ends there. Views conflict about what labour market flexibility actually is, and how it can be achieved, and these differences reflect to a large extent previous conflicts about labour market policy and different labour market traditions within the EU. The chapter opens with a discussion of different approaches to labour market flexibility before proceeding to an analysis of recent trends in the European labour market which provides the context for later sections
on policy. The chapter then traces the evolution of labour market policy from its beginnings to its postAmsterdam Treaty phase, concluding with analysis of policy proposals for the new century.
