THE STATE OF THE EUROPEAN UNION Towards a new legislative term

THE STATE OF THE EUROPEAN UNION 84 Social Scoreboard, Cyprus and Portugal seem to have succeeded in catching up with the European average again after severe economic crises. The mediocre posi- tion of the developed welfare states of Luxembourg, France and Germany is astonishing, as is the surprising top position of Slovenia. Compared to the 2017 social indicator scores, Lux- embourg (-4), France, Germany and Malta (-3 each) have deteriorated relative to the EU average on a sig- nificant number of indicators. All four countries were still in the group of very high-performing Member states in 2017 but have fallen back to European mediocrity with the pandemic. In total, eleven countries had more indicators below the EU average in 2021 than in 2017. Only six countries improved compared to the EU aver- age in some indicators; these are Hungary (+3), Croatia (+2) as well as Spain, Ireland, Latvia, and Slovenia (each +1). In ten states, the relative position in the compari- son remained unchanged. The countries of southern and south-eastern Europe, which are far from the median, have not deteriorated since 2017 despite the pandemic. Overall, the overview of the 15 comparable indi- cators of the Social Scoreboard shows that the social situation has steadily improved since 2017 on an un- weighted average of the Member states – despite the severe economic crisis caused by the pandemic. How- ever, in the five years since the EPSR was introduced and the Social Scoreboard has been used, the overall picture is one of a relatively stable tripartite social structure in the EU. The first group of ‘best performers’ are Austria, Denmark, Sweden, Finland, the Czech Republic, the Netherlands and Slovenia. These countries have above- average values in a variety of indicators; Slovenia alone has managed to show an additional indicator above the EU average since 2017. The group of ‘worst performers’ consists of Greece, Bulgaria, Croatia, Spain, Italy and Romania, which have below-average scores in a variety of social indicators. Only Spain and Croatia have man- aged to jump above the EU average in several indicators since 2017. The third group of ‘average performers’ is the largest, with 14 countries. They all cluster around half of the 15 indicators above or below the EU average. This group has seen the most movement since 2017, with many countries worsening, i.e. having more social indicators below the EU mean than four years earlier. Conclusion During the pandemic, European measures such as SURE, social investments within the framework of NGEU and the suspension of the Stability and Growth Pact suc- ceeded in limiting social distortions. The Social Score- board accompanying the EPSR shows in the aggregated view since 2017 that the social situation in the EU is slowly but steadily improving. This is especially true for the labour market data. Measured against the crisis events of recent years, the labour market situation is quite good on average in the EU. The short-time work- ing rules in the pandemic, which were promoted by the EU through the SURE instrument, certainly contributed to this. Nevertheless, since the introduction of the EPSR, only very few Member states have managed to achieve above-average social results. Moreover, some indicators are at levels that are clearly in need of improvement. These include equal opportunities and labour market ac- cess as well as social protection and social inclusion in connection with the first and third chapters of the EPSR. Education, training and further education opportuni- ties for children and young people do not appear to be sufficiently developed or are insufficiently utilised. The disadvantage of young people is also reflected in their high risk of poverty or social exclusion. This also affects the whole population to a large extent. Social transfers do little to alleviate the situation on average in the EU; at the same time, income inequality is high and further aggravated by recent inflation. In 2023, the resilience of European labour markets has come under increas- ing pressure from deteriorating economic growth. The recent sharp rise in the cost of living is leading to a wid- ening of poverty risks and entrenched inequalities. The EPSR has passed its first test while its importance has grown in the pandemic. To play a central role in current and future economic crises, to limit the emergence of social problems, the EPSR should be permanently ac- companied by financially backed instruments.