Politics & Policies

EU – The impact of recent reforms on inequality

This thematic review performs an analysis of the impact of recent reforms on inequality in Europe and was prepared by a network of external experts – the European Centre of Expertise (ECE) in the field of labour law, employment and labour market policy.

The review consists of 27 country-specific articles dedicated all EU countries covered by the European Semester process (all EU Member States except from Greece) and a synthesis report.

The experts were asked to select a limited number of reforms to report on, prioritising them in terms of their impact on inequalities and not to present an exhaustive discussion of reforms in 2015 and 2016. This review and the country reports therefore do not seek to provide a comprehensive picture of all relevant reforms implemented in recent years. A particular attention is given to reforms triggered by country-specific recommendations. If certain systems/policies had already been reformed prior to 2015, such reforms are not included in the scope of this review.

Figure 1 below shows the scores for the EU-28, where the Gini Index figure for 2015 ranges from 23.7 (Slovakia) for the most equal country to 37.9 (Lithuania) for the least equal country. The mean for the EU-28 is 31. The interquartile range for 2015 is between 26.8 and 34.1. Countries in the first quartile are the most equal countries in terms of disposable income after social transfers (from lowest score/more equal): Slovakia, Slovenia, Czech Republic, Finland, Sweden, Belgium, and the Netherlands.

Countries in the fourth quartile are the least equal countries after social transfers: Greece, Spain, Estonia, Latvia, Bulgaria, Romania and Lithuania. Compared to the situation before social transfers, it is interesting to see that the most unequal countries before transfers represent a different set of countries, including Portugal, Germany, the UK and Ireland – thus indicating that social transfers have a key role to play in enhancing equality of disposable income.

Figure 1 also shows data for 2008 (not available for combined EU-28, Croatia). The mean figure across the EU-28 for 2008 is similar to 2015 (29.8 – not including Croatia – compared to 31). Fifteen countries became less equal between 2008 and 2015 (i.e. the Gini Index increased), 10 became more equal (i.e. the Gini Index decreased), and two remained the same (no data for Croatia). In a small number of countries there was a significant increase in the index (becoming less equal): Cyprus (+4.6), Estonia (+3.9), Lithuania (+3.4), Hungary (+3), Denmark (+2.3), Spain (+2.2), and Romania (+1.5).

Chosen excerpts by Job Market Monitor. Read the whole story at Publications catalogue – Employment, Social Affairs & Inclusion – European Commission


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