Towards a new normal? Employment and social impacts of changing supply chains and declining trade intensities

Europe is being transformed by changes that impact the livelihoods and wellbeing of its citizens. Such changes present important opportunities for the EU to innovate and shape forward looking inclusive societies and economies, while avoiding the mistakes of the past and promoting an inclusive recovery that strengthens economic and social resilience. However, demographic changes, digitalisation, automation, environmental degradation, the transition to a low carbon economy and globalisation all pose multidimensional, interconnected and complex social and economic challenges. At the same time, there has been an increase in inequality, poverty and social exclusion, a polarisation of skill needs in the labour market, and a slowdown in convergence in income and employment in most European countries. Inequalities threaten social and territorial cohesion, economic growth and wellbeing. Moreover, the COVID-19 pandemic has magnified the pervasive inequalities across European societies, with significant differences in the way losses and costs of the COVID-19 pandemic and the crisis that followed are distributed in society. To seize the opportunities emerging from socio-economic transformations in a strongly connected and integrated world, these challenges need to be better understood and tackled.

Population ageing increases social protection spending on pensions, health and long-term care and restricts the capacity of the redistributive system to reduce inequality. Societies also need to adapt to a new role elderly people may have, with their experience and capacity to remain productive. Policies need to support a transition towards more environmentally-friendly ways of producing and providing private and public services, while ensuring all regions and individuals equally benefit from these transitions and that no one is left behind, in particular when it comes to access to essential services. Access to social protection for those in need should be ensured, while making sure that everyone can participate in economic, social, political and cultural developments. Social protection supports individuals in emergencies that they can no longer cope with on their own and, in addition, protect them by means of long-term measures – whether in the event of illness, accident, need for care, unemployment or old age. Moreover, mitigation and adaptation strategies are essential to make sure population movements shaped by these transitions are positive for all areas, and do not contribute to deepening the divide between regions or countries.

Education and training are key long-term factors in preventing and reversing inequalities and promoting equal opportunities, inclusion and social mobility. However, the educational outcomes of younger generations are still determined to a large extent by the socio-economic background of their parents rather than by their own potential. Promoting and ensuring inclusion and equity in education and training is thus fundamental in breaking these patterns.

In this context, it is important to reflect on the nature of economic growth and the need to better capture the different dimensions of social progress. It is increasingly important to distinguish between the different purposes of measurement: economic activity, social and cultural wellbeing and sustainability, and to develop relevant indicators. This is particularly the case as the pervasive effects of the COVID-19 pandemic has altered the economic performance and socio-economic fabric of many countries in Europe.

Migration has been a critical component of the makeup of European societies, one that is likely to dominate policy and political agendas for many years to come. It is an issue requiring comprehensive and coordinated European responses in order to ripen its benefits, both inside and outside the EU, involving Member States, Associated and partner countries, EU actors, as well as local and regional authorities, civil society organisations, migrants’ representatives – including migrant organisations – and economic and social partners. Partnerships between these stakeholders are needed to make the most of the positive consequences of migration, as well as ensuring that migration occurs in an orderly and dignified manner. The task of research is to better understand migration in a global and EU context, assist in its governance, support security and help the socio-economic as well as civil-political inclusion of migrants in European societies. It can enhance policies by providing evidence on the causes and consequences of the phenomena and facilitate timely response by identifying trends and suggesting possible policy solutions.

The implementation of the research activities in the two calls of this Destination will contribute to a comprehensive and reflective European strategy for inclusive growth, including social, economic, ecological and historical dimensions. This will strengthen the resilience of the EU and of its citizens, and will ensure that no one is left behind, including through the accumulation and preservation of human capital in the face of old and new risks. It will equally support productivity gains and their fair distribution, as well as boosting social and economic resilience that is essential to face situations of crisis such as in the case of COVID-19. Activities will contribute to EU migration and mobility policies, both internal and external. The overall knowledge generated, including a holistic understanding of societal wellbeing, will feed into the design of policy strategies in line with the above mentioned objectives and will facilitate the assessment of policy needs and outcomes in the field of the societal and economic transformations.

The Destination calls for proposals that may help in reaching these key strategic policy objectives in the EU. It invites proposals to do so by integrating feedback loops with stakeholders and policymakers that may help in developing suggestions and recommendations throughout their lifecycles. These proposals should take into consideration the stakeholders associated to the decisions that are suggested, and should also account for the context in which decisions are made. Therefore, in order to maximize and facilitate the uptake of group-sensitive recommendations in policy, they should include analyses of political and financial trade-offs associated to the recommendations produced, reflecting also on contextual changes needed to implement proposals developed. Proposals are also invited to build upon previous research funded by Horizon 2020, valorising its experience and findings.

Expected impacts:

Proposals for topics under this Destination should set out a credible pathway to contributing to the following targeted expected impacts of the Horizon Europe Strategic Plan:

• Social and economic resilience and sustainability are strengthened through a better understanding of the social, ethical, political and economic impacts of drivers of change (such as technology, globalisation, demographics, mobility and migration) and their interplay.

Inclusive growth is boosted and vulnerabilities are reduced effectively through evidence-based policies for protecting and enhancing employment, education, social fairness and tackling inequalities, including in response to the socio-economic challenges due to the COVID-19 pandemic.

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