The Amsterdam Treaty was signed two years ago and in April 1999 it was ratified by all the Member States. One of the main changes was the introduction of a Chapter on Employment (Digest, JESP, 7.4.1 and 7.4.2). At national level, three general elections (United Kingdom, France, Germany) have modified the political context. In the UK, the new Labour government put an end to the Conservative opposition to a European social policy. It supports the attempt to create a social partnership both at national and European level. The victory of the French Socialists provided an occasion to relaunch the discussion on other aspects of monetary integration (economic governance, taxation, employment, etc.). And finally, the new German government brought into the debate the relation between macroeconomic and monetary policy and more particularly the issue of wage increases. In this paper we present in a schematic way a few of the main events that characterized that period (1997–99), relying on the main Community documents and some of the recent academic analysis. As a yardstick we will use the questions we raised some time ago about the prospects offered by the new Employment chapter (Goetschy and Pochet, 1997). We highlighted three points in particular: the dynamics of the process, its content and the link with macro-economic policy. First, we considered that the new thrust initiated by the new chapter should mean that the European and national, or indeed subnational, levels could interact more effectively, while at the same time it could set up dynamic relationships in which the social players, at European and more importantly at national level, could become involved in an increasingly developed consultative mechanism. Next, we wondered about the consistency of the November 1997 Luxembourg Summit for employment. Anticipating the ratification of the Amsterdam Treaty and its employment chapter, the European Council adopted nineteen measures, which fall into four chapters (Employability, Adaptability, Developing Entrepreneurship and Equal Opportunities) (Digest, JESP, 8.1.7). Our concerns were twofold. First, we considered that the need for a joint approach to the unemployment problem was at least questionable. Unemployment has been reduced in a number of countries using different remedies (e.g., the UK versus the Netherlands, or Ireland versus Denmark). Secondly, the choice of a ‘diplomatic’ type of process, such as the negotiations that take place within the Council of Ministers (several of which are involved here, given the interaction between Ecofin and Social Affairs, with the European Council on top of the pile) struck us as risky in terms of the consistency of diagnosis and solutions. In other words, the process could favour consensual solutions (such as vocational training) which are perhaps not the best, rather than more controversial solutions (for example, to reduce labour costs or working time) which might be more effective. Finally, and this was the most critical EUROPEAN BRIEFING