Europe Ahead ( A vision document & some practical tips to implement strategy) :

( Author : NS Chandrasekaran)

Background :500 Milllion people (size of work force being 150 Million ie. 165 Million less unemployed
of 10% , granting that aging pensioners form nearly 30% and the youth, the potential productive value
adders, upto 20 years and less incl. those in school, etc , drop outs form nearly 20% and with only about
40% of women in the 20- 60 age group working ) turning out 25 % of the planet’s GDP (80 Trillion USD)
ie. one twentieth of the world is producing 25% of GDP, which is phenomenal and also may be one of
the highest per capita earnings across the world . What is besetting Europe( the consortium of 28, now
27 member countries) is the inevitable aging and the decline in population growth. This would mean it
having to reckon with a. improved productivity and from such sources/countries where the relatively
younger population live(mostly the emerging economies like erstwhile communist bloc countries
Poland. Hungary, Bulgaria, Romania, Czech, Slovakia, Serbia and Tunisia, Cyprus/Turkey/Greece).

Challenges :

Mass employment is the need of the hour for the nearly 33% or 165 Millions workforce ,even as
automation , incidental to innovation and deployment of high technology, forces redistributes available
jobs .

The traditional mass employment sectors have been Agriculture, the primary sector and the
manufacturing ( textiles , mining/exploration , auto/bldg products /mass transportation wagons/ HT,LT
electrical eqpts.) being the 2ndary and services (IT, healthcare, hospitality/tourism) the tertiary sector .
Even as the average productivity of humans drops and automation increases , related downstream
businesses in each of these sectors such as food processing( such value addition) to Agriculture , SMEs
to large mfg co’s and Hospitality and Travel/Transportation among services others being healthcare
for therapeutic reasons, as adjunct to Tourism, IT to BFSI with Govt. and IT across all sectors of services
, will have to act as the pillars supporting all the above ( in effect generate mass employment)

Despite being a knowledge society ,it may be appropriate to engage R& D scientists in the labs in
Emerging markets( low costs) and the spin offs being used for developing/mfg in the European markets
, eg. being auto ( hybrid and Elec. cars /self driven cars) and pharma/bio sciences industries.

The challenges for the policy makers would be to sell the idea to people to be multi skilled ( ie. learn
new skills , retrain and join professions other than the ones they have been engaged in . While Agri and
textile sectors have been the biggest employers followed by Engg. orgs , because of environmental
considerations, less growth will be witnessed in Mining /oil/gas /energy exploration industries and the
shift happens to clean or renewable energy like solar/wind, ocean , etc as well as CDM technologies .
So the need for people to reskill (acquire new skills) when they are laid off from conventional industries
like Agriculture, textiles, mining/ metals mfg/ engg. co’s.

Govt. may think in terms of redistributing large tracts of arable land (with few owners, persuading
them too ) to engage more people on a sharing basis( cooperative)or lease basis , only for production (
with ownership not changing) to engage many in the good old Agri/food processing sector . Similarly
textile units which make cloth , can outsource to many individuals ( men or women) to do value addition
by coming up with apparels , each with min. capital investment in CST m/cs on an SME basis and the
outputs of these units be bought by the big stores/chains. This would mean the govt.
initiating/facilitating dialogues between the stake holders ( bet. Landlords/ farmers small land
holders/agriculturists/farmers ) ,Textile /Apparel manufacturers and SME apparel units. As 4 to 6 mths a
year , may not witness any agriculture ( except in moderate tropical counties bordering the
Mediterranean/Aegean ) ,because of cold conditions , the persons engaged in agriculture will have to
be provided minimum support for sustenance for upto 4 or 6 mths (during non farming periods). This
support must be used to create assets for the govt., such as infrastructure.

As Europeans have placed a high premium on Knowledge acquisition , many who may want to be in
the high technology areas like Big data, fin. Services , ( requiring analytics, etc) aerospace/defence , bio-
sciences semiconductors/research labs could be engaged in ECC funded / University funded institutions
in respective countries and particle research/nuclear/space exploration will continue be engaged in
Universities/Labs , etc funded by both Govt. and public agencies on a PPP mode. For the same reason ,
non STEM people such as may want to become professionals - Lawyers, accountants ,
doctors/healthcare workers and teachers ( from the literature/ fine arts/history/geography oriented )
must be provided opportunities. Maths and STEM teachers will have to upgrade with programs on
regular basis by the ECC /respective country grants for such Institutions to offer these offline or online

Healthcare will require many many nurses, technicians ,lab assistants , etc . So skills required for these
institutions can be arranged by ECC/respective Govt .

Citizens not so much interested in engg. / technology , but are desirous of arts/literature and such soft
skills, can be given training in areas such as writing skills, music classes, arts/painting/sculpting classes
or people with good communication skills be engaged in PR or as tourist guides/travel agents
/counsellors .

As more professionals may be required in other disciplines like Insurance/banking/financial services ,

sales agents for Manufacturing and service sectors PR/Marketing skills can be imparted .

Effectively , Redeployment of wealth( mainly land use and not ownership change), reskilling , govt.
facilitating ( on PPP mode) reskilling/upskilling of people , even as jobs move from one sector to
another ( so encourage people to be multi skilled so start from school 6th grade onwards based on the
child’s proclivity such as STEM, or Arts/literature or caring for others like healthcare .
Industrywise absorption of workers ( in these sectors) : Over the years 2015 to 2050(assumption)

Agriculture/Food processing/Dairy 8 to 4 % (8%in 2015 > 4% in 2050)

Textiles/Apparels 7 to 5%

Mfg ( Core sector-Steel,Metal,engg.) 15 to 10% ( decline)

High Technolgy- Defence /Aerospace /Cern LikeLabs/ 8 to 10%

Mining/Minerals/ exploration/Processing 11 to 7% ( decline)

MRO of transportation/ Infra Services 5 to 7% (increase >)

Electrical/Energy stations /HVAC/ bldg. maint. 2 to 1%

Realty( res.,commercial),Bldg materials 2 to 1%

Banking/Fin/Ins Services 2 to 3%

Shipping/stevedoring/logistics(increased trade) 2 to 3% (>)

Retail Stores/Marketing 2 to 3% ( >)

Professionals 4 to 8 % ( >)

Healthcare Workers 3 to 5% ( >)

Education 1 to 1.5%

Tourism/Hospitality/airlines/museums 2 to 4% (>)

IT services/communication/call centers 4 to 6% (>)

Media/Entertainers /Musicians/ensembles 0.5 to 1% (>)

Infrastructure- Roads/ports/transportn/Schools }

Public buildings maintenance( balancing factor) } 10% to 15% (>)

Govt / Gov . Services 1.5 to 1.0

Unemployment 10 to 5%
Employment Distribution across sectors in 2015 ( assumption)

2015

Agri/Foodprocessing
Textile/Apparels
Maufacturng/engg
HighTechnolgy
Mining/metals/minerals/explorn
MRO/Transportn/InfraServ
Energy/ElecStns/HVAC/BldgMaint
Realty
Banking/Fin/insurance Servcs
Ship/Stev/logistics/
Retail/Marketing
Professionals-Law/Drs/Accts/Tax
Healthcare Workers
Education/skill Centres
Tourism/Hosp/Airline/CultPlcs
IT Serv/Commn/call centres
Entertainers/Musicians/Bands
Infra/Ports/railHeads/PubBldgs
Governement serv
Unemployed
Goal Ahead ( 2050): Employment Distribution ( assumption)

2050

Agri/Foodprocessing
Textile/Apparels
Maufacturng/engg
HighTechnolgy
Mining/metals/minerals/explorn
MRO/Transportn/InfraServ
Energy/ElecStns/HVAC/BldgMaint
Realty
Banking/Fin/insurance Servcs
Ship/Stev/logistics/
Retail/Marketing
Professionals-Law/Drs/Accts/Tax
Healthcare Workers
Education/skill Centres
Tourism/Hosp/Airline/CultPlcs
IT Serv/Commn/call centres
Entertainers/Musicians/Bands
Infra/Ports/railHeads/PubBldgs
Governement serv
Unemployed
Potential concentration of industries and countries/opportunities(core strengths)

High Technology Countries : Germany/France /Austria/Britain

Auto : Germany/France/Italy/Sweden

Medium Tech Co’s : Czech, Bulgaria , Denmark, Holland

Textiles : Hungary/Poland/ Portugal/Spain

Emerging Tech Countries : Erstwhile communist countries incl Hungary/Poland , Bulgaria,

Slovenia/Serbia

Agriculture : Spain/Portugal /Italy ( Italy also in design, engg)

Pharma/Medical Eqpts : UK/Germany

Light Engg : Turkey / Greece /Romania apart from Ger/Fra/Italy

Precision Industries : Latania/Lithuania/Estonia/Luxembourg

Tourism : France /Austria/ Greece/Turkey/ Spain/Italy/Portugal

Electronics/semiconductors : Germany/France /Netherlands

Communication/Switches/Phones : Scandinavian Countries Sweden/Finland

Electronics/Semicon/CapitalGoodsDesign: Britain/Germany/ France/Denmark/Finland

Trading/Shipping : Dutch/ All countries with their ports especially Belgium, Poland

BFSI : Ireland/France/Germany/Luxembourg/Britain

Entertainment /leisure : All tourism promoting countries

Infrastructure : Roads/railheads/ports/ buildings Across all countries

ICT/IR Servcs,HiTech design : Ireland/Iceland/UK, France/Germany/Italy/Hungary/Bulgaria/Norway

Entertainment ( Movie/TV prog)/Journalism :France/Italy/ Austria /Hungary/Poland/Britain

Note : The above are indicative concentration of industries with their clusters/feed units, given the
availability of ecosystem/labour close by and does not restrict the industries to these countries alone ,
with the other industries inviting lower investment and correspondingly lower employment potential.
No industry is the exclusive preserve of a country and all countries can pursue their options in a spirit of
competition , a sine qua non for a knowledge society.
EUROPE ( Inset parts of Scandinavia except Norway)

Non members are Norway , Switzerland, Bosnia Herzegovina

How to achieve this or road ahead :

Goals fixed for each country along with annual budgets for 5 ( medium) and broad budgets for 15(long)
and 25(very long) year periods at ECC/ECM annual meeting including on Monetary policy ( for
growth/inflation reasons) with targets for employment fixed in each of the sectors, given the growth
rate of each country which could be bet 1 & 3 % max. identified given each country’s strength ( along
the lines given potential concentration of industries/skills or the evolving focus areas even as the whole
of Europe/the Knowledge society moves up the value chain) along with industry associations/captains
of industry from respective countries. While consumption drives produced/manufactured produce and
services , min. of 15 % avg. per capita savings must be encouraged ( thru appropriate Govt. interventions
such as Bonds, etc apart from tax breaks for savings like savings in pension funds, Equity /Insurance
schemes, etc ).
Corporates /co’s SMEs. etc should get necessary Investment allowance /tax breaks for Capital
investments ( must be encouraged to make min. of 15 %to 25 % of surplus funds from the income
earned every year after appropriations like dividends , etc in production/capital goods/ eqpts or other
assets (incl Buildings , reconstruction etc by way of tax breaks for Investments made, being tax
exempt) and thru Community or CSR activities( bulk of it at least ) , which create assets
tangible/intangible both , as these create jobs .

This Investment will fuel innovations/inventions in all sectors . The technological revolution will be
witnessed in personal wearables, portable communication devices/robots, electric cars /driverless
cars/clean development mechanisms (CDM), mass transportation- inter/intra cities , energy sector-
mainly renewable energy sources incl. ocean thermal energy being tapped and in power evacuation with
minimal transmission losses. It may be worthwhile to plan for contribution of incremental GDP growth
to the extent of at least 0.5 %, to 1 % because of these investments.

Income /safety nets being in place during times of unemployment , the unemployed should be given
higher support/maintenance fee , if they reskill/upskill themselves in Authorised Govt/PPP(Private
Public Partnership mode ) schools for skill upgrades.

As trade is important , suitable trade pacts with other blocs should be made such as Atlantic alliance,
African alliance, Indian Ocean Alliance , Asean , South American bloc, BRICS etc and encourage
exports/imports in order to achieve the engagement of upto 5 % of people in trade/trade , related
activities and supporting infrastructure like Ports/ Transportation and airlines, etc Exchange programs
with Heads of ECC, ECM and major country heads visit the major countries/ markets-the members of
these Trading blocs, bet 2015 & 2050. Strong emphasis must be made while negotiating the trade pacts ,
the need to protect revenue likely to stem from technology exports/patents and enforcement by the
bloc’s members. This is essential ,as Europe could turn out to be one of the most advanced blocs to
export technology and this incentivizes(motivates) the knowledge workers/inventors. Necessary legal
courses also must be thought of for enforcement /or when commitments are not met/abrogated.

As the bloc is a united one and allows free movement of labour, the people will move between now and
2050 for reason of work and seek , the kind of work each prefers.

All member countries must be encouraged to maintain the current population ie achieve net
reproduction rate by encouraging couples to have more children and such families getting tax breaks or
more expenses of additional children’s education and healthcare costs being borne by Govt . Where
population growth falls, a. technology must step up and makeup for productivity and b. equip labour
force with specific high tech skills , etc or enable those who possess them from across the globe to
migrate . Here the assumption is automation /robots contribute the missing productivity from humans.

Policies such as a. govts’ framed to encourage non polluting industries

b. Reskilling centres opening on PPP mode

c.Increased funding for Infrastructure maintenance/Public Health /education

 d. Soft credit lines for exporters and importing countries ( to facilitate imports)

must be made and targets announced ( to make the people target oriented , regardless of

criticism from opposition )

Incentives for reskilling to be announced for Govts. and people ( trickle down) in form of unemployment
support thru’ doles .

In order to encourage SMEs , concessional banking credit terms(int. rates) must be announced/
reviewed periodically and rewards given for target production/target export achievers.

Risk factors for non – achievement of each of the goals must be identified and provisions must be made
in budget for non achievement( variance)

The key concern ( short term till 2020) and how to address it :

How to sell the idea to the Heads of State of Members that the plans for the Medium term upto 2020
will succeed :

The members are divided across the Governance Systems as follows: 3 Semi presidential
representative democracies viz France, Romania and Portugal and 1 Presidential govt of Cyprus and the
rest 23 (now 22) being Parliamentary democracies .All these countries have witnessed changes of Govt
from right of centre to middle/left of centre parties, regardless of the respective Govt’s performance
good or bad , as people in these countries have been mostly indifferent to who(which party) was ruling (
despite voting in large numbers at the hustings ) or anti incumbency factor has been at work ,because
they all know despite the intentions of the Govt and monetary policies , globalization, integration with
rest of the members and the larger world, competitiveness across sectors from across the world (
despite protectionist measures) have resulted in slow GDP growth and redistribution of jobs across the
member countries, if not altogether lost to cost effective & cheaper Emerging economies like China &
India other BRICS ‘ countries and other emerging economies

Nonetheless , 2.2 Trillion investment to be made by 2020, 35% of it will have come from 28(27) member
states Govts, 25% of it from the 142 Fortune 500 Co’s with 10 % coming from SMEs , 5 % from Overseas
investors of emerging economies like BRICS/Nigeria/KSA and another 10% as FDI inflows and remaining
10% by the larger Public thru Stock exchanges/IPOs/Private placements . Govt will have to kick start
with nearly 45% of their investment in Infrastructure such as Transportation, Ports , Roads/rail heads
and Low Income Housing and Public Buildings, 15 % as Capital Infusion into Banking system and 40%
in state run mfg co’s and as support/subsidies for ailing sectors . The 142 Fortune 500 co’s will invest
their 25% investment in their respective brownfield and Greenfield projects and so will the SMEs. FDI
inflows channelized thru’ Mutual funds / Private Equity will be made in the existing and new age
industries .

The situation being that people are willing to accept trade offs in terms of cut in welfare for allocation
to Education, healthcare and social support schemes, the targets will be the citizens of the currently
well off member states and high income earning citizens of the lower per capita income members too
will have to make a larger contribution by way of accepting larger cuts and pay more taxes so that the
middle and low median income families/individuals benefit ie as it is safer to assume that people in
higher tax brackets ( and with a history of creating wealth/recd high incomes ) get a lower share of the
welfare ( or willing to forego ) in the event of their unemployment/layoff compared to the middle and
lower income earners .The interest rates on workforce’s PF and pension also will be lowered in those
years where there is need for their country to resort to austerity in order to raise investment or keep up
the investment levels.

In order to promote entrepreneurship, govt funded tech parks can accommodate them at low rentals ,
give them infrastructure such as IT/servers/connectivity or access to labs such as common bio science
parks . This in fact encourages start ups.

Dwindling workforce has to be augmented with extended worklife ( notwithstanding reactions like in
France witnessed couple of years ago , thru proper propaganda) and also encouraging more women to
join. Women have to be accommodated with flexi timings, work from home option/telecommuting,,
offer of crèche facilities near workplace, maternity benefits prior and pre/post delivery leave following
pregnancy . Women and youth join the workforce in larger numbers serves the purpose twofold, one
they not only contribute to GDP by value addition , but being being spenders themselves also create
demand( pull factor) and consequently consumption .The median salary too will come down , for reason
youth are at lower age levels and women accepting lower pay because of trade offs being offered, as
seen earlier. This obviously does not hold good for career women , who are treated on pay parity with
men. (The author does in no way suggests, differential and discriminatory pay for women, the trade
offsoffered offsetting the otherwise matching pay)

Youth can particularly be attracted to the workforce , with govt offering apprentice roles/stipend( part
of stipend like 50%) to new inductees hired by all Corporates in both public and Public Sectors . The
duration of apprenticeship shall be 6 mths to 2 years , depending on the nature and extent of skill
required. The apprentices are certified to be employed in the units where they were apprentices or
they seek hobs elsewhere .The purpose of gainfully employing people and reducing unemployment is
sought to be achieved by this and this way the support/maintenance fee (discussed earlier) can be paid
and at the same time reskilling /upskilling objective is achieved.

Governance :

As monitoring mechanisms have to be designed to check and take appropriate remedial measures even
as every country heads towards its goals, adequate thought should be given to them as well and a
typical qtrly and annual reports must be made and employment ( current levels) and anticipated job
opportunities for the next 6 mths/year must be announced every Quarter through media and direct
publications to Industry associations and heads of industries and political leaders . This will help govts/
industries /individuals to plan their moves, govts their plans, industries their investment and the
individuals seek opportunities in those countries which are likely to meet their aspirations.
A matrix of countries and skills must be made and the labour dept of each country must inform the
public at large where the jobs exist and anticipated skills deficiency is likely to be in the years ahead .
This would help the people also to plan their career moves. Needless to say people security perception
id paramount and the govts’ commitment to safety & security is to be ensured so that migration
happens to safer heavens.

Remedial measures such as interest rates will be announced on Qtrly basis and inflation /growth targets
balance to be revised every half year, correcting for GDP/industrial/agri outputs too every ½ year and
reporting the factual.

Exchange Rate : Strong exchange rate does not bode well for exports and so demand and supply side
constraints must be examined every quarter and industry warned of anticipated world volumes of such
goods and services ( incl. high tech areas , IT flows and info) , in order to ensure effective exports . Also
where such strong exchange rate is inevitable , concessional financial mechanisms /line of credit may be
offered to these countries , where such goods are in demand. A case in point could be high tech capital
goods manufacture and infrastructure /utilities ( such as metro transportation/airliners/nuclear energy
supplies ), high end design services where many countries aspiring to play catch with the knowledge
society , offer concessional lines of credit in order to promote exports , either from European Bank or
other multi lateral agencies like World Bank, IMF, OECD institutions. This is apart from the traditional
exports from Europe like defence equipment – aircraft/ships/submarines/armaments.

While risk and their mitigation factors may have been identified , still if some member countries do not
meet targets , penalizing does not pay ( on the contrary adverse reactions emanate ) ,but given time
and suitable monetary packages devised to bail them out and also help them achieve the backlog. This
can be ensured by taking into confidence, industry and opinion leaders of these countries from time to
time and impress upon them the need to pull up and improve their performance in a spirit of
competitiveness. Despite these , if some ,member country continues to be ‘chronically ill’ it must be
advised/persuaded to opt out of the union and join when it recuperates ( when economic health
improves and for the foreseeable future as well ie. mid term of at least 5 years .) Mentoring by well
performing countries of the ailing ones , will be the need then. It is to be hoped that that the opinion
leaders and political leaders will be able to convince the naysayers of the need for improved
performance and their competitiveness . With Big Data and analytics it should be possible to predict in
advance of the likely slippages from the ‘guidance’ of those countries ( just as credit rating agencies do )
which will render those countries forewarned to be forearmed.

Conclusion :

While it may be fact that the political spectrum of member countries’ leaders ranges from
traditionalists /ultra conservatives to liberal/neo liberals to moderate left and the views they bring to
the Parliament (either in their own country or in Belgium), fact remains that there has been Unity in
Diversity and it must stay on to ensure their collective destiny and not repeat the turbulence of the 20th
century. With collective wisdom they all know that every member country should endeavour to
achieve goals, regardless of their country/party/self short term goal of political survival . Europe with its
legacy of producing great thinkers/philosopher /orators with communication skills will ensure this and
remind member countries/ their people realize that long term goals or values are better ones to aim for

A committed European Commission & Common Market with a strong and committed leadership guided
by the European Parliament and in the Individual member countries , notwithstanding Britain’s
imminent exit with each country’s , a relentless and rigorous pursuit of goals with extensive
communication out to people at large, taking them into confidence ( thru’ extensive yet subtle
propaganda), without forsaking long term goals, despite probable short/medium term guidance
variances, with committed investments ( with tax breaks) in industry/education/healthcare and
infrastructure and upskilling of people, the land of Machiavelli/Medici/Napolean and inventors like Da
Vinci/ Galileo/Ptolemy/Newton/Einstein/vonBraun/Bohr/Pasteur/Madam Curie and great artists
Rembrandt/van Gogh / Beethoven/ Mozart/Strauss apart from philosophers such as
Aristotle/Voltaire/Jean Paul Sartre should be possible to strategize and realize the target at hand with
all union members contributing to a great symphony, working harmoniously. A stable , growing and
enlightened Europe owes it to the world and it can/will do it.

While wars and clash of cultures where the order of the last century , the current century places a
premium on using intellect to solve the challenges and this can be done thru’ means of innovation,
modernization, reconstruction and maintenance and the rational leaders and the people who follow
them , will do well to reflect and act accordingly . Europe to the fore.

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