Welfare systems and labour market policies for economic and social resilience in Europe

Four megatrends - technological transformations, globalisation, climate warming and demographic changes - reshape labour markets, redefine opportunities and risks, and pose new challenges for welfare states in the EU. WeLaR aims to fill knowledge gaps about these processes by pursuing two main goals: (i) provide a comprehensive and comparative diagnosis of the effects on megatrends on labour market risks and challenges for welfare states; (ii) develop policy recommendations to adapt welfare states. WeLaR contributes to the destination’s goal of promoting inclusive growth, fair distribution of its productivity gains, and boosting economic and social resilience. In measuring effects, we account for interactions between megatrends, and disentangle their impacts of on labour supply, labour demand, and labour market allocations, which are also shaped by institutions. We pay particular attention to groups that often face higher labour market risks: women, young workers, people in atypical jobs or in in-work poverty. In developing policy proposals, we combine simulations with lessons from recent welfare state interventions and social innovation experiments, while accounting for political economy of reforms. We use an interdisciplinary approach that combines quantitative and qualitative methods and adopts a cross-country perspective, covering the entire EU, which allows us to understand the role of country-specific institutional settings for the effects of megatrends and challenges for welfare states. To ensure relevance of policy ideas, we engage in extensive consultations and set up feedback loops with stakeholders, which complement and validate the quantitative and qualitative studies. These stakeholder consultations help to develop concrete policy proposals aimed at resilient, inclusive growth. We deliver research papers and policy briefs. To maximise WeLaR’s impact, we disseminate the lessons learned and policy proposals to policy-makers, stakeholders and the public.