On the European Semester for economic policy coordination: employment and social priorities – annual report 2026

MOTION FOR A EUROPEAN PARLIAMENT RESOLUTION

on the European Semester for economic policy coordination: employment and social priorities – annual report 2026

(2025/2183(INI))

The European Parliament,

– having regard to Article 3 of the Treaty on European Union,

– having regard to Articles 9, 121, 148 and 149 of the Treaty on the Functioning of the European Union (TFEU),

– having regard to the European Pillar of Social Rights (EPSR) proclaimed and signed by the Council, Parliament and the Commission on 17 November 2017,

– having regard to the Commission communication of XX November 2026 on the Annual Sustainable Growth Survey 2026,

– having regard to the Commission proposal of XXX 2026 for a joint employment report from the Commission and the Council,

– having regard to the Commission recommendation of XXX 2026 for a Council recommendation on the economic policy of the euro area,

– having regard to the Commission report of XXX 2026 entitled ‘Alert Mechanism Report 2025’,

– having regard to the Commission communication of XX November 2026 entitled ‘Draft Budgetary Plans for 2025: Overall assessment’,

– having regard to the report by Mario Draghi entitled ‘The future of European competitiveness’, published in September 2024,

– having regard to the report by Enrico Letta on the future of the single market, entitled ‘More than a Market’, published in April 2024,

– having regard to the report of the High-Level Group on the future of social protection and of the welfare state in the EU, published in January 2023,

– having regard to Rule 55 of its Rules of Procedure,

– having regard to the report of the Committee on Employment and Social Affairs (A10-0000/2025),

A. whereas in June 2025, the unemployment rate in the EU stood at 5.9 %, while youth unemployment remains high at 14.7 %; whereas higher levels of employment are not fully matched by job quality, wage increases and productivity gains;

B. whereas the European Semester remains a central instrument for coordinating economic, fiscal, employment and social policy across the EU, and thus offers an opportunity to embed social, environmental and intergenerational fairness more systematically into macroeconomic governance;

C. whereas 21 % of the EU population was at risk of poverty or social exclusion (AROPE) in 2024; whereas insufficient progress is being made towards the objective of reducing the number of children at risk of poverty or social exclusion by 5 million by 2030;

D. whereas climate change and environmental destruction have exacerbated inequalities and affected the most vulnerable groups; whereas the transition towards climate neutrality is expected to create about 2.5 million additional jobs;

E. whereas housing cost pressures and high energy prices impose significant burdens on households, yet housing policy has often been under-represented in country-specific recommendations;

F. whereas the EU faces a persistent shortage of workers and skills, owing to a number of factors, including poor job quality;

G. whereas data indicates that more effort is needed across most Member States to reach the target of 60 % of adults participating in education and training by 2030; whereas the integrated approach to policy coordination within the European Semester provides the framework to guide the necessary investment in human capital development, education and training systems;

H. whereas additional investment needs in social infrastructure have been estimated at EUR 192 billion per year, including in affordable housing, health and long-term care, education and lifelong training1; whereas further work is needed to measure the social investment gap in the EU as well as the economic returns on social investment;

1. Stresses the competitive advantage of investing in the EU’s social model; calls for the recommendations of the High-Level Group on the future of social protection and of the welfare state, as well as the recommendations of the Letta and Draghi reports, to be integrated into the European Semester process; welcomes the integration of the EPSR into the economic governance framework and calls on the Member States to take advantage of the possibility of extending the adjustment period for investing in the EPSR priorities; calls for the integrated governance framework to be reflected in the internal processes of the EU institutions, with their economic and social bodies involved to equal extents;

2. Considers that the Commission and the Council should strengthen their efforts to implement the EPSR; calls for the EPSR action plan targets to be embedded at the core of the European Semester by making them benchmarks in the European Semester assessments;

3. Welcomes the Commission’s ambition to eradicate poverty by 2050 and its intention to propose a quality jobs act; emphasises the need for coherence between the European Semester, the follow-up to the EPSR action plan and these upcoming instruments, with measurable targets and corresponding country-specific recommendations;

4. Welcomes the permanent inclusion of the social convergence framework in the European Semester; stresses its importance, together with the social scoreboard, for identifying risks and tracking progress on upward social convergence;

5. Recalls that social investment can have a positive impact on economic growth, productivity and competitiveness, thereby also supporting fiscal sustainability while promoting upward social convergence; calls on the Commission and the Council to treat social investment as foundational to sustainable growth;

6. Emphasises that the Commission’s affordable housing plan should be integrated better into the European Semester, with a stronger focus on affordable, sustainable and decent housing in country-specific recommendations; reminds the signatories to the Lisbon Declaration on the European Platform on Combatting Homelessness about the goal to eradicate homelessness by 2030;

7. Emphasises that investment in education, upskilling and reskilling is a strategic social investment with long-term returns for competitiveness and cohesion;

8. Emphasises that intergenerational fairness must become a structural component of the European Semester; calls on the Commission, as part of its intergenerational fairness strategy, to integrate indicators on youth well-being, access to quality jobs, housing affordability, education and skills into the European Semester’s assessment framework, and to systematically evaluate long-term impacts of fiscal and reform recommendations;

9. Acknowledges that Member States have committed to investing 5 % of GDP annually in core defence requirements and related security spending by 2035, including through the activation of the national escape clause; stresses that, within the framework of the European Semester, such expenditure must be planned in a coordinated manner;

10. Notes that the European Semester recommendations in 2026 will play an essential role in the drawing up of the national and regional partnership plans; believes that reforms and investments should be selected on the basis of the efficiency and effectiveness with which they address the relevant country-specific recommendations;

11. Supports a more democratic European Semester process, with Parliament strongly involved in setting economic policy priorities and taking economic governance decisions; insists on the systematic involvement of social partners, civil society organisations, and regional and local actors in the European Semester process;

12. Instructs its President to forward this resolution to the Council and the Commission.