Abstract
The European Union created the European Globalisation Adjustment Fund (EGF) in 2007 to assist workers negatively affected by globalisation in their search of a new job. The EGF was an acknowledgment that the EU, which has exclusive competence over trade policy, needed to assume some responsibility for the economic displacement due to globalisation. This article attempts to evaluate the EGF programme after 10 years of activity. Our evaluation addresses both its political visibility and its economic effectiveness. We find that the programme was visible in the sense that EGF beneficiaries tended to work in large firms and that their dismissals were reported in the media. The economic effectiveness of the programme is more difficult to evaluate because the available data is insufficient. Estimates, however, suggest that only a small proportion of EU workers who lost their job due to globalisation received EGF financing. Unfortunately, it is also impossible to assess whether workers who received EGF assistance did better in their job search than those who did not receive assistance. We make three recommendations to improve the programme: (1) collect more and better data to allow a proper evaluation of the programme; (2) revise the eligibility criteria to qualify for EGF assistance and the co-funding rate for the contribution by low-income regions; and (3) enlarge the scope of the programme beyond globalisation to also assist workers displaced by intra-EU trade and offshoring that result from the working of the single market, which is also an exclusive competence of the EU.
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Notes
- 1.
- 2.
This chapter was previously published as a working paper in the Bruegel Policy Contribution series as Claeys and Sapir (2018).
- 3.
- 4.
The publication of these reports, which could be useful to assess the EGF, is not mandatory and only a few member states publish them (see for instance Ireland: http://egf.ie/final-reports-for-completed-egf-programmes/), Thus, we do not have access to most of them.
- 5.
The UK is the only country in the EU without a national coordinator for the EGF and the British government made it clear that it was not interested in participating to the EGF and that it did not want the EU programme to be renewed. See for instance in 2012: https://publications.parliament.uk/pa/cm201213/cmselect/cmeuleg/86-xvi/8605.htm. Moreover, we find in the ERM database (see next section) that at least 6 cases of extra-EU offshoring could have been eligible to EGF funding in the UK between 2007 and 2016.
- 6.
See ESF guidelines: http://ec.europa.eu/esf/main.jsp?catId=525
- 7.
Collecting data at the individual level in order to be able to undertake scientific ex-post evaluation was recommended by Wasmer and von Weizsäcker (2007) when the programme was launched.
- 8.
Coming back to our back-of-the-envelope calculation, if all 180,000 workers affected by globalisation were covered, this would represent a total budget for EGF-financed programmes of 800 million euro per year (assuming expenditure equal to the average amount spent in the period 2007–16, i.e. around 4200 €/beneficiary).
- 9.
Reducing the threshold to 100 redundancies would also result in an additional 150 extra-EU cases.
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Acknowledgement
The authors would like to thank Raphaële Adjerad and Inês Gonçalves Raposo for their excellent research assistance.
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Claeys, G., Sapir, A. (2020). The European Globalisation Adjustment Fund: Easing the Pain from Trade?. In: Paganetto, L. (eds) Capitalism, Global Change and Sustainable Development. Springer Proceedings in Business and Economics. Springer, Cham. https://doi.org/10.1007/978-3-030-46143-0_7
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