E.U. conference on “Investment in Human Resources”

For investment in the upskilling of people in employment, particularly lower skilled workers - says Minister for Labour Affairs Mr. Frank FaheyT.D.

Minister for Labour Affairs, Mr Frank Fahey T.D., has today (Monday 21^st June 2004) told an E.U. conference on “Investment in Human Resources”, that with fewer people entering the labour market from schools and colleges due to Europe’s changing demographic, companies are becoming increasingly dependent on the skills and adaptability of their existing workers to remain competitive.

The one-day conference in Dublin Castle, which forms part of the Irish EU Presidency agenda, was also addressed by the EU Commissioner for Employment and Social Affairs, Mr Stavros Dimas and by the Commission’s Director General for Employment, Mme Odile Quintin.

Minister Fahey, who officially opened the conference, said there was “a compelling business case, as well as a social inclusion case” for investing in the training and education of workers who were currently low-skilled. “The political recognition of the value of investing in human capital is based on clear evidence that it pays off, and that the skills and knowledge base of the labour force increasingly defines the competitive profile of industry and business. By directing resources towards education, training and re-training Member States can promote increased productivity, growth and more jobs” he said.

The Minister said, "The European Social Fund, among other factors, had made an important contribution to Ireland’s recent economic success, not principally due to the amounts involved but to the way in which ESF transfers had been spent. Ireland had chosen to invest in human capital, in education and training, and that priority now needed to be further developed if we were to maintain and improve productivity in an increasingly competitive global economy."

Emphasis must be put on equipping people with the right skills for the modern diverse workplace so that individuals are able to do a range of jobs and are capable of working in the knowledge-based economy. A key challenge for Member States is therefore the promotion of the concept whereby everybody has the opportunity to learn and upgrade his or her skills," he said.

Minister Fahey said Ireland had prioritised these issues during its EU Presidency because it was conscious of their importance if Europe was to meet the 10-year targets for growth and employment set at the Lisbon Summit in 2000. “Immediate reform is required if we are to achieve the Lisbon objectives, and a heightened pace of change is required from Member States, enterprises, individuals, social partners and the Commission”.

Commissioner Dimas said that improving the quality of the European workforce was probably the most important challenge facing the EU. “But investing in human capital is not just about supporting large public education and training programmes.

“It is about stepping up active labour market policies, such as reforming tax and benefit systems to encourage training and further education, and paying attention to the quality and level of public spending on education and training. It is also about matching skills and abilities in the workplace, ensuring that companies, especially small companies, are not held back by a shortage of skilled workers,” he said.

The Commissioner said the independent Employment Taskforce, chaired by the former Dutch Prime Minister, Mr Wim Kok, had stressed the need for Europe to re-think how it invested in its human resources, pushing public authorities, individuals, themselves and businesses to start sharing the responsibility for the cost of investing in human capital. “Investing in human capital and raising skills levels pays off. In the past 5 years, over 60% of all new jobs have been in the high-skills sectors and one additional year of school or training increases an individual's salary over a lifetime by almost 10%. Everybody gains, so it is appropriate that education and training costs should be shared by all."

The Commissioner added that it was clear that cohesion policy should embrace the whole of the European Union but the absolute priority for future Structural Funds must be the least developed Member States and regions.

ENDS/LA80