17 January 2012

Commission launches debate on corporate restructuring - what lessons from the crisis?

The consultation will also help identify specific restructuring measures that could help deal with employment and social challenges, and help European companies improve competitiveness through innovation and a fast, but smooth adaptation to change.

Restructuring is part of business life and one of the important ways of helping a company stay competitive. The economic and financial crisis has put an extra strain on business: from 2002 to 2010, over 11,000 cases of restructuring were recorded by the European Restructuring Monitor, with a ratio of almost two jobs lost for every one created (1.8:1). Between 2008/2010, this ratio has increased to 2.5:1. Many companies and their workers have developed innovative arrangements to limit job losses. Here, social partners have played a key role. These initiatives have varied from working hours, to more social dialogue, to adjustment measures or the intervention of public employment services. However, these may be less effective in a context of persistently weak demand.

László Andor, EU Commissioner for Employment, Social Affairs and Inclusion, presented the new Green Paper, saying: 'To be able to react better in the future, we have to understand the reasons behind the success of some measures in some countries, or sectors during the crisis. We have to look at how measures, like for example short-time work, can be used to deal with the challenges we are likely to face in the coming period." He added: "We also want to see how we can best anticipate the employment and skills needs of the future, especially in the light of new challenges and growing social inequalities across Member States. And last, but not least, we want to see how the social impact of restructuring can be limited."

The Commissioner also stressed how the EU stands ready to help and support Member States through the cohesion policy, in particular the European Social Fund as well as the European Globalisation Adjustment Fund.

Content of the Green Paper:

The Green Paper includes several questions. In particular, it addresses the following issues:

• Lessons from the crisis – are existing policy measures and practices adequate? What are the success factors and future challenges? How have short time working schemes functioned during the crisis and how have they coped with a persistently weak demand?
• Economic and industrial adjustment – what are the relevant framework conditions and existing good practices on access to finance, to accompany structural adjustment?
• Adaptability of business and employability of workers – an anticipative approach best? Is there a possible need to update existing guidelines on restructuring and the means to ensure their implementation?
• Creating synergies in the process of industrial change – how to improve the synergies between companies, local authorities and other local actors? How to develop training as a permanent feature of human resources management?
• Role of regional and local authorities – how to encourage a supporting role of public authorities taking into account different national traditions?
• Impact of restructuring operations - what can be done by companies and employees to minimise the employment and social impact of restructuring operations and what role can public policies play in facilitating these changes?

The Green Paper is supported by the staff working document, "Restructuring in Europe 2011", which draws on the main lessons learned in recent years on anticipation and management of change and restructuring.

The consultation period will run until 30 March 2012.

Press release

Consultation

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