• Council of the EU
• Press release
• 12 November 2025 16:41

The Council presidency, the European Central Bank and the European Commission met with European social partners on 12 November 2025 to discuss recent developments of the economic situation, as well as a thematic topic chosen by the Danish presidency: “The importance of labour market and human capital-building reforms in enhancing the EU’s competitiveness”.

Competitiveness and productivity are top priorities for the Danish presidency. Today, we have been discussing how to boost both through labour market and human capital-building reforms in EU member states, while supporting efforts at the national level with EU level measures. Labour market and human capital-building reforms constitute the most important area of policies to strengthen productivity and potential growth. Thus, it is important that EU institutions and policy makers continue the debate on advancing these reforms with social partners also beyond MEDPOL. It is a long Danish tradition to involve trade unions, social partners and employer organisations to overcome barriers to important reforms.

Stephanie Lose, minister for economic affairs of Denmark, which currently holds the Council presidency

Europe’s economy is gradually regaining momentum, even amid ongoing geopolitical challenges and heightened uncertainty. However, skills shortages and weak innovation continue to weigh on our competitiveness and long-term growth potential. We must work hand in hand with social partners to act decisively and address these challenges. Investing in people’s skills is not only a social priority, but also an economic imperative. At the same time, we must accelerate our work on deepening the Single Market and cutting red tape to facilitate innovation, create high-quality jobs, support SMEs and secure our long-term prosperity.

Valdis Dombrovskis, Commissioner for economy and productivity; implementation and simplification, European Commission

The macroeconomic dialogue is a valuable opportunity to exchange views with social partners. Robust labour markets in the euro area have supported economic resilience despite global uncertainty, but growth must be strengthened. The Eurogroup’s statement on competitiveness highlighted the importance of boosting investment opportunities and implementing well-calibrated structural reforms, including up-skilling and re-skilling schemes, greater labour market flexibility and mobility and attracting and retaining talent to enhance innovation. A healthy labour market is underpinned by sound public finances which the Eurogroup continues to address through close coordination of economic and fiscal policy strategies in order to enhance overall policy effectiveness and support economic growth. I look forward to continuing these discussions as Ireland prepares to take up the Presidency of the Council of the European Union in July 2026.

Paschal Donohoe, President of the Eurogroup and Irish minister of finance

The solution to Europe’s economic challenges lies in workers. When people have money in their pocket, they spend it in the real economy. Workers are the motor of Europe’s economy. But spiralling housing costs and the ongoing cost-of-living crisis means that too many working people struggle to make ends meet. In 16 member states, rent consumes more than 50% of a full-time minimum wage. It has never been more critical for the EU to support collective bargaining and working people’s just demands for higher wages.

Esther Lynch, General Secretary of the European Trade Union Confederation (ETUC)

The ongoing underperformance of the EU economy reflects the present challenging landscape for European businesses, with increasing trade tensions and continued competitiveness issues. Nevertheless, the relative stability provided by the EU–U.S. agreement reached in July, and the overall resilience of the EU economy, so far helped to avert more negative outcomes. To ensure that the EU economy reaches its full potential, the EU should significantly step up its efforts to revitalise its competitiveness. Both the EU and member states must act swiftly to implement measures that lower energy prices, reduce regulatory burdens, simplify administrative procedures, further trade diversification, and lead to a simpler and less distortive tax system. As the EU spends significantly less in research and development than its competitors, completing the Savings and investment union is a must and the upcoming EU budget will also be crucial to help close the EU’s investment gap in key strategic areas.

Thérèse de Liedekerke, Deputy Director General of BusinessEurope

Raising productivity is Europe’s central economic challenge. In times of uncertainty and tighter fiscal space, maintaining investment in people, skills and services of general interest will be essential to sustain growth and labour market participation. The architecture of the next multiannual financial framework, including its connection with existing instruments such as the EU Semester, must emphasise this logic and ensure that EU and national budgets work together to strengthen delivery capacity across all territories by empowering social partners and SGIs and developing the “freedom to stay”.

Valeria Ronzitti, SGIEurope, Secretary General

The Danish presidency rightly points to the importance of labour market reforms and human capital development for Europe’s competitiveness. Labour market reforms can be a key driver of productivity growth if they take a comprehensive approach that includes taxation and social benefit systems. Such reforms should aim to increase labour market participation and mobility, and to facilitate the reallocation of labour towards more productive jobs. Regarding human capital, better alignment between education systems and vocational training with future labour market demands will be as crucial as making Europe more attractive to qualified and qualifiable migrants. Finally, SME competitiveness is also under threat from wage increases that outpace productivity gains, especially for labour intensive services.

Gerhard Huemer, SMEunited, Economic Policy Director

Cyprus shares the view that labour market and human capital reforms are vital to boost Europe’s productivity. Cyprus, as the upcoming presidency, is committed to ensure the effective policy coordination of European and national labour market policies, within the framework of the European semester, to enhance the resilience of EU economies and boost EU’s competitiveness. At the same time, we stand ready to facilitate the successful implementation of labour market reforms through the RRF, in view of its final year of implementation.

Christina Rafti, Permanent Representative of Cyprus to the European Union (next Cyprus Presidency: January-June 2026)

The next macroeconomic dialogue will be organised under the Cyprus presidency.

• Macroeconomic dialogue of 12 November 2025 (video and photo)

Last review: 12 November 2025