Even if all the unemployed in Belgium are put back to work, it will probably be impossible to achieve the government’s 80% employment rate target in 2030, despite the assertion of Employment Minister Pierre-Yves Dermagne who says the target is "within reach."
Recently, the Belgian statistics office Statbel announced an employment rate of 71.9% on average for the year 2022, and even 72.3% for the fourth quarter of 2022, which shows a positive trend. To reach the 80% target, it would be necessary to increase both the number of people available for work and the number of jobs.
"It would be a question of gaining eight percentage points in eight years, since we must go from 72% in 2023 to 80% in 2030," Muriel Dejemeppe, professor of economics at UCLouvain told RTBF.
"In the last 20 years, there have been two periods in which the employment rate has risen sharply. First between 2003 and 2008, just before the financial crisis. We were in a period of strong economic growth with relatively significant job creation. We then gained 3.3 percentage points in five years, which is to say about 0.7% per year," she said.
Post-Covid recovery is exceptional
The second period lasted from 2015 to 2019, with again 3.3 percentage points, but in four years this time, which gives 0.8% average per year. "So, on these two periods considered positive, we are below the target."
Since 2021, the employment rate has increased by 1.9%, she added. “So over two years, it's almost one percentage point per year, that is the goal. And so, Dermagne can say that by continuing like this, we will reach 80% in 2030. But it's completely unlikely: this post-Covid recovery is exceptional, we have never experienced such a good period in the past."
Then there is the highly politicised issue of job creation.
"Assuming that we manage to increase the number of people available to work, it would still be necessary to increase the number of available jobs," Dejemeppe added. "Because with 189,000 jobs available at the end of 2022, we are still far from the 540,000 jobs needed to reach the goal."
Between the third quarter of 2020 and the third quarter of 2022, some 200,000 jobs were created in Belgium. "But the forecasts for 2023 are already much less favourable, around 38,000 jobs," she said. "I calculated that to get to 80% of jobs in 2030, taking into account the growth of the population aged between 20 and 64, it would be necessary to create 75,000 jobs per year."
However, when looking at the number of jobs created on average between 1956 and 2022, Belgium is at 45,000 jobs per year – meaning it never reached a rate of 75,000 per year over a long period. "And according to the Planning Bureau, it will be around 40,000 jobs per year, or 0.4 percentage points per year. So, with an unchanged policy and without a major crisis, we would not exceed 75 or 76% of the employment rate in 2030."
In conclusion, to achieve the objectives set, it would be necessary to significantly increase the number of people available for work because it would not be enough to simply put the current number of unemployed people back into the workforce. Any chance of reaching the figures needed would rely on those on long-term sick leave and those in the 55–64-year-old category going back to work.
But it would also be necessary to increase dramatically (at a rate not seen since 1946) the number of jobs created in Belgium for another eight years. In other words, the government's target of an 80% employment rate for 2030 seems impossible to achieve.
