European subsidies intended for construction workers in Italy

A 3.9 million euro European aid was decided by the European Globalisation Adjustment today in benefit for 528 construction workers in Italy .

The European Commission has today proposed to provide €3.9 million of assistance from the European Globalisation adjustment Fund (EGF) to Italy. The funding, matched by €2.1 million of national contribution, will help 528 redundant construction workers from a number of mostly small enterprises in two Italian provinces of Trentino and Bolzano back into employment. The proposal now goes to the European Parliament and the EU’s Council of Ministers for their approval.

The Italian application relates to 643 redundancies in 323 small and medium sized enterprises operating in the construction of buildings sector in the region of Trentino-Alto Adige/Südtirol. The dismissals were a consequence of the financial and economic crisis, which resulted in a substantial fall in demand for new houses and house renovation in this region where the construction sector is an important employer.

Of the total 643 workers made redundant, the 528 workers with the greatest difficulties of re-integration into the labour market are targeted for assistance from the EGF. The package of EGF assistance will offer the workers one-to-one counselling and guidance; skills assessment and outplacement; coaching; general training and re-training; individual vocational training; mentoring after reintegration into work and participation and subsistence allowances.

Background

Available data confirms the significant downturn in the construction sector, which fell in the EU-27 for seven consecutive quarters (first quarter of 2009 to the third quarter in 2010) compared to the same period of previous years. This was mainly due to the decrease in private investment in the residential sector.

The area affected by the redundancies is the region of Trentino-Alto Adige/Südtirol which covers two autonomous provinces: Trento and Bolzano/Bozen. The economic situation of both provinces deteriorated in 2009 and their economic growth was negative (-3,0 % and -2,6 % respectively) compared with the previous year. Unemployment in Trento increased by 117 % in 2010 compared to 2009. In Bolzano/Bozen unemployment in at the end of 2010 was 43 % higher than in the same period the previous year.

In this area in Italy, the construction sector contributes to about 15 % of regional GDP and represents 8.6 % of the jobs in Trentino and 8 % in Bolzano/Bozen. The impact of the redundancies at local level is especially high - some 9.3 % of the new redundancies in the province of Trento from March to December 2010 took place in the construction sector, while in the province of Bolzano/Bozen this rate was 11 %.

There have been 78 applications to the EGF since the start of its operations in January 2007, for a total amount of about €357.6 million, helping nearly 76,000 workers. EGF applications are being presented in a growing number of sectors, and by an increasing number of Member States.

EGF applications relate to the following 25 sectors: automotive (Austria, Belgium, Germany, France, Poland, Portugal, Sweden, Spain); textiles (Belgium, Italy, Lithuania, Portugal, Spain); wearing apparel (Malta, Lithuania, Slovenia, Spain); construction of buildings (Ireland, Italy, Lithuania, Netherlands, Spain); specialised construction (Ireland); architectural and engineering (Ireland); machinery and equipment (Denmark, Germany, Poland); printing industry (Netherlands); electronic equipment (Austria, Netherlands, Portugal); retail trade (Czech Republic, Greece, Spain); mobile phones (Finland, Germany); basic metals (Austria, Bulgaria); domestic appliances (Italy, Lithuania); computers (Ireland); shipbuilding (Denmark); furniture (Lithuania); carpentry and joinery (Spain); ceramics (Spain, Italy); stone/marble (Spain); crystal glass (Ireland); shoe manufacture (Portugal); publishing (Netherlands); wholesale trade (Netherlands); aircraft maintenance (Ireland); road transport (Austria).

The EGF, an initiative first proposed by President Barroso to provide help for people who lose their jobs due to the impact of globalisation, was established by the European Parliament and the Council at the end of 2006. In June 2009, the EGF rules were revised to strengthen the role of the EGF as an early intervention instrument. It forms part of Europe’s response to the financial and economic crisis. The revised EGF Regulation entered into force on 2 July 2009 and applies to all applications received from 1 May 2009 onwards.

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