Currently almost 1.3 million Belgians between the ages of 25 and 64 aren’t working or looking for a job. Both the Flemish and the Federal governments set the goal of ensuring that 80% of the working population is in employment. However, figures on the employment rate in Belgium last year show that this is still a very long way off. The figures from the University of Ghent (UGent) show that while half of all EU member states have employment rates of 80 or above, Belgium falls far short of this with just 75.4% of the working population in employment in 2022.
1.27 million Belgians of working age aren’t working and aren’t looking for a job
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When the Flemish Government took office in 2019 and a new Federal Government was formed in 2020 both coalitions said that it was their aim to reach an employment rate (the percentage of people between the ages of 25 and 64 that are in employment) of 80%. This is necessary in order to ensure the sustainability of our social security and pensions system. However, while the employment rate in Belgium has risen considerably (from 67.4% in 2019 to 75.4% last year), it is still well short of the goal of 80%.
There are big regional differences. With an employment rate of 79.7% Flanders falls just short of 8 out of 10 of the working age population in employment. The Brussels-Capital Region has and employment rate of 70%. Wallonia is just behind Brussels with 69.4% of the working age population in employment there.
The figures for Flanders put our region around mid-table when compared to other EU countries. Belgium as whole has one of the lowest employment rates in the EU. Our Dutch neighbours’ employment rate is 3.5 percentage points higher that of Flanders at 83.2%.
“Inactive” population the issue rather than unemployment
The big issue is the large group of people between the ages of 25 and 64 that are “inactive”. This group is different from those that are unemployed. Unemployed people are looking for work, “inactive” people aren’t. This group includes housewives and househusbands, people on long-term sickness benefit, students and people that have stopped work before their 65th birthday.
The unemployment rate in Belgium (3.7%) is relatively low. Even if every person that is currently unemployed found a job tomorrow the employment rate would remain under 80%. The “inactive population” is much larger. 1,267,000 people in Belgium between the ages of 25 and 64 fall into this category. 225,000 people in Belgium are unemployed.
But why are so many people “inactive”?
There are several reasons. In Belgium only half of all people with no or few qualifications are currently in work. In The Netherlands this is 2 out of 3. Belgium also scores poorly when it comes to the percentage of immigrants from outside the EU that are in work. People living with a handicap that prevents them from doing some types of work are (much) more often inactive in Belgium than is the case elsewhere in the EU.
With 16.5% of all working age men in Belgium inactive, we are performing worse than all other EU countries except Italy and Croatia. With 25.3% of working age woman inactive Belgium at around the EU average. The figure for people over the age of 50 that are inactive in Belgium are among the worst in the EU.
“Make work pay”
The researchers that carried out the study say that the key to getting more people into work is reform of how income from work is taxed. “In Belgium, for every 100 euro that an employee who is single is paid by their boss 53 euros goes to the state coffers (social security and tax). In The Netherlands this is 35%. Moreover, there you retain more social benefits if you go and work for a low wage”.
The researchers don’t see any improvement in the future as further automation threatens the jobs of people with below average to average levels of academic attainment.