European unemployment insurance. From undercurrent to paradigm shift

Abstract

The need for the European Union to get involved in unemployment insurance has frequently been debated in the past decade, starting from exploratory discussions and eventually becoming a political commitment by the European Commission President. This article looks back at the origins of the idea of an EU-level unemployment benefit scheme and explains the political dynamics of the concept’s evolution. Following the 2009 Great Recession and the subsequent eurozone debt crisis, a new movement for a reinforced social dimension has been pushing the EU beyond its previous red lines. The case for counter-cyclical social stabilisation at EU level is now a touchstone for a materially meaningful EU social dimension. The COVID-19 crisis triggered a giant leap to a greater EU budgetary capacity, including financial support for job-saving schemes. This article argues that these new instruments will not suffice without also creating an EU safety net for those whose jobs cannot be saved in a period of economic downturn.