Complete study-presentation revitalising-the-european-dream.-a-corporate-view

Brussels, 29 June 2011

Revitalising
European
the
Dream
A CORPORATE VIEW
European
Executive
Council

Re-vitalising the European Dream:
A corporate view
Overview of the study
Re-energising the European economy
Reshaping the European social model
Redefining the European role in
international affairs

The State of Europe project was conducted in three steps, focusing
on two outputs: a white paper and inputs for three roundtables
Approach

White paper:
Survey of European Revitalizing the
business leaders European dream:
A corporate view
 Survey sent to 38,000 European
business leaders from EU27,
Norway and Switzerland. Yield:
Analysis and
~2,000 respondents synthesis of results

Roundtable
Interviews with
discussions at
policymakers and
The State of the
thought leaders
European Union
 European Commissions and  Social roundtable: Reshaping the
Delegations European social model
 OECD  International roundtable: Redefining the
 Academia European role in international affairs
 Business leaders  Economic roundtable: Reenergising the
European economy
 …

1

The online survey was sent to a wide community of business
leaders across Europe
Response Period: Feb., 28th – Apr., 1st 2011
Mix by industry Mix by country Mix by age
Over 60 20-29
Belgium
Austria Bulgaria 3%
Automotive
Sweden 14% 30-39
Agriculture, Fishing, Forestry Switzerland
Transport 23%
1% Romania Cyprus
Other Energy, mining 2% 5%
4% Portugal Czech Rep.
& utilities 1% 3% 1%
Poland
Consumer 3%
Norway 1%
Germany 50-59 25%
Goods Netherlands
Business 2% 12%
Services
1%
20% 36%
Italy 8% 3% Denmark
Estonia 40-49
2%
19% Ireland 1% Spain Mix by gender
Hungary 2%
Greece Finland Female
Education 2% 10%
3% Information, 17%
18% Comm. &
Technology United Kingdom France
Finance &
Insurance

Retail
Lithuania Malta
Health & Other social serv. Luxembourg Slovenia
90% Male
Law/Justice & Public Admin. Latvia Slovakia

Response Rate 5%, ~ 2,000
Source: Booz & Company analysis

2

Survey questions revolved around four key themes

Emotional Reshaping the Redefining the
Reenergising the
perceptions of European social European role in
European economy
Europe model international affairs

 Emotions with regard  Social policy  Presence and  European economic
to Europe influence of the EU, growth perspectives
 Labour policy with today and in 2030 and drivers
 Perceptions of current regards to the – Regions of
situation in Europe anticipated decline in focus  Economic policy
(e.g., financial crisis, the EU workforce – International
unemployment) aid policy  Climate and
 Education system and sustainable energy
 European Union’s its evolution towards  Potential new policy
position as a global 2030 member states by
power, today and in 2030
2030
 Trade policy

3

A solid majority of respondents have positive feelings about
Europe
What are your emotions about Europe?
All respondents
100%
9% 10%
17% 16% 17% 12%
24% 23% 23% 23% 27% 26% 25% 21%
33% 28% 30%
33% 38% 38% 33%
31%
72% 57% 50% 41%
69% 58%
48% 33%
55% 54% 49% 49% 49% 53%
60%
45% 43% 47% 24%
53% 45% 43%
17%

16% 21% 19% 27%
11% 14% 17% 10% 12% 14%
18% 31%
9% 18% 19% 18% 15% 21%
10% 13%
10% 7% 10% 8% 11% 12% 12% 10% 13% 10%
5% 5% 10% 4%
7% 2% 5%
8% 3% 3% 3% 4% 4% 7% 2%
3% 3% 5% 2% 1%
Avg BG AT BE GR SE FI PL HU FR ES DE PT RO DK IE NL IT NO UK CH

Very positive Positive Neutral Negative Very negative
Note: Numbers may not add to 100% due to rounding.
Source: Booz & Company and INSEAD 2011 State of Europe Survey (1,914 respondents); Booz & Company analysis

4

Concern dominates feelings about Europe’s current situation

How do you feel about the current situation in Europe?
All respondents
1% 3% 2% 2% 1% 2% 1% 1% 2% 2% 100%
7% 5%
20%
26% 24% 23% 23% 24% 22% 22% 20% 18%
27% 31% 26% 27%
38% 31% 27%
46% 43% 37% 33% 2% 4% 8%
6% 4% 11% 10%
7% 7% 12% 9% 5%
5% 9% 6%
3%
12% 19%
52% 58% 65%
62% 58% 70% 56% 63% 64%
55% 43% 47% 56% 53%
56% 45% 59% 65%
46%
37%
38%

19% 16% 13% 11%
9% 13% 13% 5% 14%
10% 8% 6% 3%
9% 8% 8% 11% 5% 6% 7%

Avg HU DE NO BG AT BE PL FI IE SE RO IT ES GR NL FR PT UK CH DK

Enthusiastic Confident Indifferent Concerned Alarmed

5

Most respondents think that the European Union’s position today
one of a second-tier power or even more limited
How do you see the European Union’s position today?
All respondents
100%
16% 17% 21% 21% 15% 15% 15% 13% 15% 14% 17% 16%
20% 22% 18%
29% 26% 26% 28% 32%
40%
25% 19% 19%
31% 30% 29% 29% 26%
26% 35% 34% 32% 28% 26%
22% 24% 23% 19% 14%
38%
19%
17% 24% 28%
27% 15% 19% 18% 24% 25%
20% 14% 15% 23% 27%
22% 21% 26%
16% 33% 38%
13% 40%
31% 32% 37% 35% 40%
32% 36% 25% 27% 29% 37% 34%
28% 28% 26% 31%
20% 24%
14% 14%
4% 6% 4% 6%
2% 3% 1% 1% 2% 1% 1%
Avg BG GR SE ES PT FI DE CH NO FR IE HU PL NL AT RO UK DK BE IT

One of the main global powers A second-tier power A group of countries with no influence
A major power A group of countries with limited influence

6

Despite this, respondents are cautiously optimistic about the
future
How do you see the European Union’s position in 2030?
All respondents
100%

20% 19% 15%
26% 30% 26% 30% 26% 29% 23% 21% 20%
30% 33%
39% 39% 36% 36% 35%
43%
51%
61% 38% 27% 29% 27%
29% 26%
31% 48% 37% 32% 35% 27%
55% 29% 29% 26%
42% 31% 24%
39% 22% 29%
31% 7% 33%
22% 21% 29% 32% 29%
20% 28% 22% 26%
15% 19% 19% 14% 46%
15%
7% 13% 16% 24%
14% 13% 10% 14% 14% 14% 14% 14% 16% 24%
10% 9% 6% 10% 7% 12% 14% 13% 17%
2% 3% 3% 2% 3% 4% 4% 2%
Avg GR RO SE PL PT FI IE BG DE BE ES IT FR NL NO AT HU UK DK CH

One of the main global powers A second-tier power A group of countries with no influence
A major power A group of countries with limited influence

7

While business leaders favour EU leadership on monetary and
budgetary issues, they are more reluctant to delegate social matters
In which fields should the EU prevail over national states?

Economic and business issues Social issues

11% 14% 9%
15%
20%
38% 44% 41% 41%
48% 33% 32%
27%
64% 35%
78%
44%

40%
41% 42% 42%
35%
26%
13%
16% 16% 17% 17%
9% 10%

Monetary policy Budgetary policy Industrial policy Public health Educational Social welfare
policy policy policy

Strongly agree Agree Disagree Strongly disagree

Source: Booz & Company and INSEAD 2011 State of Europe Survey (2,030 respondents on monetary; 2,020 on budgetary; 2,017 on industry; 2,007 on educational; 2,005 on public health and 2,003 on
social); Booz & Company analysis

8

Respondents from early EU member states and the Eurozone tend
to be more inclined to delegate policy to the EU
% of strongly agree and agree
79% 74% 73% 72% 71% 64% 64% 63% 61% 57% 51% 50% 50% 46% 46% 44% 43% 41% 39% 38% Ø 56%
Overall
BG GR BE ES IT FR PT HU RO AT NL FI IE DE SE DK PL NO CH UK
97% 96% 94% 94% 93% 93% 85% 84% 84% 83% 77% 76% 75% 73% 71% 71% 69% 63% 62%
47% Ø 79%
Monetary
BE ES GR IT BG FR PT FI NL AT NO DE DK PL RO SE HU CH IE UK
87% 85% 85% 84% 81% 72% 69% 69% 69% 68% 67% 64% 60% 58% 57% 56% 55% 52% 50% 36% Ø 66%
Social
BG ES BE GR IT FR PT HU FI AT RO PL NL DE IE DK CH SE NO UK
81% 71% 70% 69% 63% 62% 59% 58% 52% 49% 48% 48% 46% 42% 41% 35% 34% 32% 29% 27% Ø 51%
Industry
BE BG GR HU IT ES FR DK NL PT AT IE RO SE FI UK DE PL CH NO
79% 73% 63% 62% 59% 59% 58% 47% 46% 45% 44%
Public 40% 34% 34% 32% 30% 29% 28% 25% 20% Ø 45%
health
BG GR PT HU ES IT RO BE IE AT FR UK NO SE PL NL CH DE FI DK

64% 63% 59% 58% 55% 54% 53% 48% 46% 41% 37% 34% 31% 30% 30% 27% 18% 18%
Education
14% 12% Ø 40%
BG RO ES IT BE PT FR GR HU AT IE DE FI SE UK NL CH NO PL UK

Countries which joined prior to 1973 or €-zone members Countries which entered after 1973 or are not €-zone members
9

A corporate view
Re-energising the European
economy
Reshaping the European social model

Business leaders responded to questions around growth prospects
and drivers as well as economic and sustainable energy policy

 What are business leaders’ expectations for growth? How
European economic realistic are those expectations? How do they vary?
growth and drivers  What key growth drivers would be most effective to achieve high
Europe-wide growth?

 How can we avoid new Eurozone crises?
Economic policy
 In which areas should EU policy prevail over nation states?

 By 2050, the EU objective is that 40-80% of energy will be
Sustainable energy renewable energy– what will be the outcome of this policy?
policy  How could the EU leverage sustainable energy to foster foreign
investments inside the EU?

10

A corporate view
economy
European economic growth and
drivers
Economic policy
Climate and sustainable energy policy

Reenergising the European economy – Growth

Respondents believe that slow growth (less than 2%) is structural –
results biased by local conditions
What are, in your opinion, the growth perspectives for the EU towards 2030?

All respondents National GDP growth forecasts and expectations of slow growth 1)
% of respondents who
believe slow growth
74% is structural Forecasted growth and respondents’
100% expectations are aligned

IT FR AT
80% BE BG
IE Avg. 74%
DK UK DE
GR SE PL
ES PT
60% RO
NL HU Forecasted growth is
Forecasted growth is
~2% but half of higher than 2% but
26% 40% ~75% of respondents
respondents have more
optimistic expectations have more pessimistic
expectations
20%

0%
The current Slow growth is
economic slowdown structural in Europe
-2.5% 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 4.5%
is temporary Forecasted ’09-’12 GDP growth

1) Responses by country with sample size > 10.
Source: Global Insight data and forecasts, Booz & Company and INSEAD 2011 State of Europe Survey (2,034 respondents); Booz & Company analysis

11


Across countries and industries, decision makers strongly agree that
innovation and SME activity are key to fostering high growth
What would be the best strategies to reach high growth in Europe?

All respondents

100%
8%
19%
35%
26% 34%
52%
64%
75%
85% 56%
95% 95%
42%
50%

43%
31%
21%
24%
13%
1% 4% 1% 5% 2% 4%

Aggressively invest Boost SME participation Focus on budgetary Foster share of Enlarge the Union to
in innovation in economy discipline of states exports in GDP high growth countries
(e.g., debt) (e.g., Turkey)
Note: Numbers may not add to 100% due to rounding. According to the European Commission’s annual SME Performance Review (2009), SMEs are defined as ‘enterprises in the non-financial business
economy that employ less than 250 persons.’
Source: Booz & Company and INSEAD 2011 State of Europe Survey (2,035 respondents on innovation; 2,018 respondents on boosting SME participation; 2,000 respondents on budgetary discipline;
1,966 respondents on share of exports in GDP; and 2,015 on Turkey); Booz & Company analysis

12


Regardless of home country R&D intensity, there is broad
consensus that Europe must aggressively invest in innovation
- Aggressively invest in innovation
% of respondents
who agree Level of R&D and enthusiasm about innovation1)
investment in innovation
drives growth

100%
GR HU IE
99% BE
98% IT
97%
DK
96% FR FI
RO PL NL DE
95%
PT Avg. 95%
94%
93% ES
UK AT
92% SE
91%
81%
80%
0.0% 0.2% 0.4% 0.6% 0.8% 1.0% 1.2% 1.4% 1.6% 1.8% 2.0% 2.2% 2.4% 2.6% 2.8% 3.0% 3.2% 3.4% 3.6% 3.8%
R&D as % of GDP (2008)

Note: According to the European Commission’s annual SME Performance Review (2009), SMEs are defined as ‘enterprises in the non-financial business economy that employ less than 250 persons.’
Source: Eurostat data, Booz & Company and INSEAD 2011 State of Europe Survey (2,035 respondents); Booz & Company analysis

13


Most respondents share common views on how to leverage
innovation to drive EU growth
How can innovation drive the EU growth over the next 20 years?

All respondents

100%

31%
40%
48%
54%
74%
97% 95% 90%
43%

55% 42%
43%
21%
8%
0% 3% 1% 4% 2% 5%

Foster collaboration between Increase the share Create crossborder Select priority industries
universities and companies of applied research centres of excellence for the R&D agenda

Source: Booz & Company and INSEAD 2011 State of Europe Survey (1,953 respondents on universities; 1,950 on applied research; 1,946 on centres of excellence and 1,945 on priority industries);
Booz & Company analysis

14


Decision makers believe SMEs are a lever of future growth -
regardless of the current level of SME participation
- Boost small and medium enterprise participation in economy
Share of SME valued added and positive opinion about SME activity Positive opinion about SME activity
By country By industry
Share of SME value added (2008) % of respondents who ’agree’ or ’strongly agree’ % of respondents who ’agree’ or ’strongly agree’

BE 58% 98% 40% Agriculture 100%
FR 55% 98% 42%
Education 97%
GR 73% 97% 24%
ES 68% 97% 29% Consumer Goods 96%

NL 62% 97% 35% Info. Com & Tech 95%
FI 54% 97% 43% Other 95%
RO 42% 96% 54%
Finance 95%
UK 51% 96% 45%
IE 52% 95% 44% Business Services 94%
PT 67% 94% 27% Energy 94%
SE 56% 94% 38%
Law & Justice 94%
HU 52% 92% 40%
DE 53% 91% 39% Retail 93%
PL 52% 91% 39% Health 92%
AT 60% 90% 31%
Automotive 91%
IT 72% 89% 18%
DK 68% 88% 20% Transportation 91%

Note: According to the European Commission’s annual SME Performance Review (2009), SMEs are defined as ‘enterprises in the non-financial business economy that employ less than 250 persons.’
Value added is defined as ‘the gross income from operating activities after adjusting for operating subsidies and including indirect taxes. Value adjustments (such as depreciation) are not
subtracted. This is equivalent to gross domestic product in macro-economic analysis.'
Source: European Commission data on SME Performance Review, Booz & Company and INSEAD 2011 State of Europe Survey ( 2,018 respondents); Booz & Company analysis

15


At the same time, Europe should emphasize budgetary discipline –
though results suggest some national bias
- Focus on budgetary discipline of states (e.g., low level of debt)

% of respondents Level of debt and positive opinion about budgetary discipline 1)
who agree budgetary
discipline drives growth
Low and medium levels of debt
95% with the highest level of
NL
agreement with
SE HU statement
DE
90%
RO FI
DK UK Avg. 85%
85% AT FR

PL BE
80%
PT
IE
IT
ES High level of debt with high
75%
level of agreement with
statement GR
65%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 110% 120% 130% 140% 150%
Debt as % of GDP (2010)

Source: Eurostat and Global Insight data, Booz & Company and INSEAD 2011 State of Europe Survey (2,000 respondents); Booz & Company analysis

16


Nearly 80% of respondents agree that exports fuel economic
growth - except for French respondents who are neutral
- Foster share of exports in GDP
Share of exports in GDP and enthusiasm towards exports 1)
% of respondents
who believe in
Low to medium export countries whose
fostering the exports
respondents are strongly enthusiastic High export countries
95% about exports
ES whose respondents are
90% PT
DK optimistic about exports
GR FI
85%
RO SE
80% BG NL IE
IT
75% DE Avg. 78%
PL
70% BE
AT
65%
HU
FR
45% 50%
40%
35%
30%
0% 25% 30% 35% 40% 45% 50% 55% 60% 65% 70% 75% 80% 85% 90%
Average share of export in GDP
(’00-’10)

17


A majority feel that expanding the EU to include neighbouring
high growth countries would not stimulate growth
- Enlarge the Union to high growth countries (e.g., Turkey)
All respondents Respondents by sector
42%
66% 100%
-16pp 29% 24% 24% 21%
26%
24% 32%
41% 43% 42%

8% 29%
20% 24% 26%
10% 10% 7% 19%

Strongly Disagree Agree Strongly agree Government/ NGO Private sector Academia
disagree International
organisation
Respondents by nationality 1)
8% 9% 100%
20% 20% 16% 19% 19% 21% 13% 18%
25% 28% 22% 30% 24% 23% 26%
34% 32% 35%
44% 39% 32%
50% 38% 42% 39% 31% 36%
77% 53% 51% 49% 45% 34%
50% 46% 40% 30%
42%
28% 30% 33% 33% 39% 41%
26% 29% 30%
20% 26% 24% 27% 22% 31% 28%
19% 20% 26%
15% 7% 8% 6% 9% 11% 10% 14% 13% 10% 14% 10% 9%
4% 6% 3% 5% 3% 3%

HU FR DE GR BG BE AT NO CH DK FI RO NL ES UK PT IT IE SE PL

Strongly disagree Disagree Agree Strongly agree

18

A corporate view
economy
European economic growth and drivers
Economic policy
Climate and sustainable energy policy

Reenergising the European economy – Economic policy

Respondents call for the reinforcement of the stability pact with
the use of penalties for failure to comply
How could we avoid other Eurozone crises?
- Strictly enforce the stability pact, use penalties, revoke voting rights and exclude risky states
% of respondents
who agree that Agreement on need to reinforce stability pact vs. Need for budgetary discipline1)
the stability pact
should be reinforced
100% NL
BE AT FI
90%
Avg. 80% DK DE
80% SE
ES
PL FR HU
70% IT UK RO
60% PT
GR IE
50%
Avg. 85%
0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% 60% 70% 80% 90%
% of respondents % of respondents who agree that budgetary discipline is necessary
who agree that
the stability pact Agreement on need to reinforce stability pack1) vs. National deficit
should be reinforced
High deficit and less support for
100%
DE BE reinforcing the stability pact
90% FI HU
SE
AT NL DK
ES Avg:80%
80% PL UK
Low to medium deficit and RO
70% FR
strong support for reinforcing IT PT IE
60% the stability pact
GR
50%
0% 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 11%
Deficit as % of GDP (2011)

19


There are differences in opinion concerning the financial safety
net: Only respondents from high debt countries wish to reinforce it
How could we avoid other Eurozone crises?
- Extend the current financial safety net supporting Eurozone stability
Debt burden and support for reinforcing financial safety net 1)
% of respondents
who agree on reinforcing Countries with high debt and high support for
the financial safety net reinforcing the financial safety net
90%
GR
80% PT
Countries with low or
70% medium debt and against FR
ES IE BE
60% reinforcement of the IT
financial safety net HU
50% NL
40% RO UK
SE DK FI
AT DE
PL
0%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 110% 120% 130% 140% 150%
Debt as % of GDP (2010)
All respondents

14% 10% 11% 13% 12% 100%
48% 62% 34% 44% 40% 51% 44% 57% 47% 59%
20% 41% 35% 31% 32%
18% 15% 14% 12% 9%

20-29 30-39 40-49 50-59 Over 60

20


With the exception of U.K. respondents, the majority of Europeans
feel that the EU should prevail on budgetary policy
- Budgetary
Debt burden and Prevalence of the EU on budget policy 1)
% of respondents
wishing the EU
to prevail on budgetary policy Respondents from high debt
countries who strongly
agree that the EU should
ES BE prevail on budgetary policy
IT
HU FR GR
FI PT
RO NL AT
Avg. 66%
PL DE
DK IE
SE 50%

Respondents from
low debt countries are UK
Anglo-
more evenly divided
Saxon
on EU budgetary
model
prevalence

Debt in % of GDP (2010)


21


Eurozone respondents tend to favour European monetary policy
more strongly
% of respondents who believe the EU should prevail over national states for monetary policy
% of ‘strongly agree’ and ‘agree’
97% 96% 94%
94% 93% 93%
85% 84% 84% 83%
Avg. 79%
77% 76% 75%
73% 71% 71%
69%
63% 62%

47%

BE ES GR IT BG FR PT FI NL AT NO DE DK PL SE RO HU CH IE UK

Eurozone Non-Eurozone
1) The Guardian ('Poll shows little support for joining euro despite pound's fall', 2 Jan. 2009)

22


Eurozone candidate countries wish to strengthen entry criteria and
do not seek to include all European countries in the Eurozone
How could we avoid other Eurozone crises? How could we avoid other Eurozone crises?
- Strengthen the entry criteria to the Eurozone - Include all European countries in the Eurozone to limit
competition with other European currencies
100% 100%
7% 4%
14% 15%
27% 25% 24% 13%
25% 36%
39% 38%

45% 38%
38%
49% 53%
31%
58% 41%
45% 73%

33% 36% 46%
21% 31%
27% 23%
14%
13%
2% 4% 5% 6%

Average BG RO PL HU Average BG RO PL HU

Note: Numbers may not add to 100% due to rounding. Only EU member states which are not members of the Eurozone, do not have an ‘opt out’ (U.K., Sweden, Denmark) and have more than 10
respondents are shown.

23

A corporate view
economy
European economic growth and drivers
Economic policy
Climate and sustainable energy
policy

Reenergising the European economy – Climate and sustainable energy policy

Respondents have mixed views on how effective current EU
renewable energy policy will be
By 2050, the EU objective is that 40-80% of energy will be renewable energy, what
do you think will be the outcome of this policy?
Respondents by country

100%
14% 14% 20%
22% 22%
37%
30%
37% 41% 33% 33% 31% 38% 29% 36%
45% 40% 42%
49% 54% 48%
28% 31%
27%
31% 37%
26%
25% 20% 17% 27% 28% 31% 24% 33%
15% 23%
27%
16%
15% 21% 41%

58% 56% 53%
47% 45% 42% 42% 42%
38% 40% 40% 40% 38% 38% 38% 37% 35%
31% 31% 31%
23%

Avg GR PT BG FI DE DK BE ES NO AT IE HU IT RO SE CH NL UK FR PL

The EU will lack execution capabilities EU companies will benefit from this energy policy
EU companies will pay to meet the targets
Source: International Energy Agency data, Booz & Company and INSEAD 2011 State of Europe Survey (2,030 respondents); Booz & Company analysis

24


Leadership in innovation and strengthening the Eur. skill base are
considered to be the best ways to attract FDI in sustainable energy
How could the EU leverage sustainable energy to foster foreign investments inside the EU?

All respondents

100%
6%
20%
42% 30%
36%
56% 58%
38%
95% 92%
47%
50%
39% 32%

17%
4% 7% 10%
1% 1%
Create leadership in Strengthen education and Reinforce specialisation by Reinforce subsidised policy
technological innovation skills of the workforce country (wind, water, solar) to foster production and
consumption
Source: Booz & Company and INSEAD 2011 State of Europe Survey (2,031 respondents on innovation; 2,022 on education; 2,018 on specialisation and 2,013 on subsidisation). Booz & Company
analysis

25


With the exception of Poland, respondents look to the EU for a
unified position on climate
On which topics should the EU take a unified position to increase its voice in
international institutions?
- Climate and sustainable energy
All respondents

100%

33%
45% 43%
54% 53% 54% 54% 51% 57% 58% 52% 49%
61% 63% 60% 58% 61% 62%
68% 67% 68%
24%

47% 19%
48% 36% 36%
36% 40% 38% 38% 40% 34% 33% 31% 31% 28% 23%
37% 33% 28% 27% 26%
24%
6% 4% 6% 10% 7% 15%
5% 6% 4% 7% 5% 9% 7%
3% 3% 6% 6% 6% 7% 8% 4% 3% 5% 4% 2% 8%
4% 2% 2% 5% 1%
1% 1%
Avg IE PT GR BE NO FI BG RO IT DE ES SE AT NL DK CH FR UK HU PL

26

A corporate view
Re-energising the European economy
Reshaping the European social
model

Respondents were asked key questions about their views on the
European social model

 Should EU member states share a common social model? If so, what
European social would it entail and what should it resemble?
model
 What trade-offs would be implied/ required?

 The EU is expected to face a deficit of 20.4m workers by 2060. How can
this be offset to guarantee the balance of our social model?
Declining  Should we use subsidies to provide the unemployed and with skills to
workforce contribute to the labour market?
 What about encouraging extra-EU migration or expanding the EU’s
borders to provide easy access to labour?

 How will European education evolve in the 2030 horizon?
 How well does today’s education fit with the needs of business? How do
Education business leaders expect this relationship to evolve?
 Will we be able to close the education gap between Eastern and
Western Europe?

27

A corporate view
Reshaping the European social
model
European social model
Declining European workforce
Education

While a majority indicate that the EU should strive for a common
social model, they were not aligned on which model to choose
Towards which social model should the EU strive?
Respondents by country
100%

13%
20% 15%
30% 29% 29%
38% 37% 36% 35% 33%
44% 41% 41% 40% 40% 40%
55% 53% 53% 52%
38% 46%
19% 25% 42%
15% 23%
13% 10% 18% 20%
29% 21% 33% 50%
7% 22%
42%
25%
62% 36%
33%
47% 50% 42% 49% 51% 46% 46% 42%
40% 44% 44%
33% 34% 38% 31%
38%
23% 21%
14% 18%
9%

Avg PL BG CH DE DK SE FI NO FR UK AT NL IT BE GR RO IE ES HU PT

No common social model Flexible labour market Strong welfare state

28

To compensate for the decline in the Eur. workforce, respondents are
much less willing to enlarge the EU than welcome extra-EU migrants
The EU workforce will decline by 20.4 million workers (2020-2060). How to offset this
decrease to guarantee the balance of our social model?
All respondents

100%
10% 8%
16% 18%

32%
40%
57%
70% 68% 47%
54% 50%

40%

30%
22% 25%
19%
8% 8% 12%

Subsidise reintegration of Subsidise female Resort to extra-EU migrations Leverage the
unemployed in the labour market integration in the workforce demographic growth of
potential new members

Source: Booz & Company and INSEAD 2011 State of Europe Survey (1,949 respondents on reintegration of unemployed; 1,944 on female integration; 1,942 on extra-EU migrations and 1,938 on
potential new members); Booz & Company analysis

29

With the exception of the Swiss, a majority of respondents approve
of subsidies to reintegrate the unemployed in labour market
The EU workforce will decline by 20.4 million workers (2020-2060). How to offset this
decrease to guarantee the balance of our social model?
- Subsidise reintegration of unemployed in the labour market
% of resp. favouring Unemployment growth rates and opinions on subsidies to reintegrate the unemployed1)2)
subsidies to reintegrate %
unemployed into workforce
100%
SE FI
80% BE BG Avg. 71% GR
NO AT RO
UK DK FR PT IE
60% DE IT
NL
PL HU 50%
40% CH
20%

0%
0% 4% 5% 6% 7% 8% 9% 10% 11% 12% 13% 14% 15%
Unemployment rate, Jan. 2011
Opinion on subsidies for reintegration of the unemployed3)
79% 71% 70% 67% 65%

Education Agriculture Bus. Services Health Transportation
% of jobs
7.0% 6.5% 21.5% 9.7% 25.9%
needed
1) Responses by country with sample size > 10. 2) Statistics for Greece and Romania: Dec. 2010. 3) Selected industries.
Source: Data: Eurostat, IMD, WE, Cedefop. Booz & Company and INSEAD 2011 State of Europe Survey (1,949 respondents); Booz & Company analysis

30

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