Quality Jobs for All: Two Challenges, Both Within Reach
The EU’s fight against poverty requires both better-paid jobs and policies that help more people into work. A commentary by Giulia Giupponi
Turning the EU’s Anti-Poverty Strategy into Action
IEP Bocconi and the European Commission bring together researchers, policymakers and civil society to discuss affordable housing, access to quality jobs and policies to tackle poverty.
Speakers include Giulia Giupponi, who will join the session on “Quality Jobs and Protection Against Poverty”.
9 October 2026, 10:00–17:00 | Bocconi University, Leonardo Del Vecchio Building, Room N01, Piazza Sraffa 13, Milan.
The European Commission’s first Anti-Poverty Strategy rests on a claim that the evidence supports: for people who are able to work, a quality job is the best protection against poverty.
That is certainly the right ambition. But it bundles together two demands, and very different policies have to meet them. Quality: the job has to pay enough, and come with good employment conditions. For all: the job has to be within reach of those who do not have one.
On both counts, there is a distance to travel. In the EU, 8.3 percent of people in work are at risk of poverty, and around one in five people aged 20 to 64 is outside the labor force. Which policies actually deliver on each?
Take pay first. Minimum wages have become the headline instrument to make work pay, and their rise over the past decade has been striking. Germany introduced a national minimum in 2015, Cyprus in 2023, and the UK and Spain have raised theirs to levels hard to imagine twenty years ago.
Here the evidence is reasonably settled. Minimum wages consistently raise pay at the bottom of the wage distribution. And employment does not fall or falls only very modestly.
If firms are not cutting jobs, how do they absorb the cost? Research shows that prices rise modestly, turnover falls, productivity rises, and profit margins take some of it. But there is another channel, which is especially relevant for job quality.
Minimum wages press hardest on firms whose business model depends on very low pay, and those tend to be the least productive. Some of those firms shrink or exit, while more productive firms – which typically offer better jobs – expand.
Research shows that, after the minimum wage was introduced in Germany, workers moved towards better-paying and more productive firms. A wage floor, on this reading, does more than raise the pay of low-wage workers. It also improves the quality of the jobs they hold.
Minimum wages are not the only lever on low pay, though. A growing literature documents the wage-setting power employers hold, because workers are poorly informed about their options, or are held in place by non-compete and no-poaching clauses.
Where employer power is greater, wages and job security are lower. European institutions constrain employer power more than American ones do, but the issue is a live one here too, and its scale calls for counteracting tools above and beyond a wage floor: antitrust enforcement in labor markets, better information about job opportunities, and support for worker mobility.
Now employment. In 2024, 51 million people aged 20 to 64 in the EU were outside the labor force. Thirty-two million were women and close to twenty million are aged 55 to 64.
For women, much of the gap between European countries opens up after the first child. Research shows that, when a couple has a baby, the mother’s employment and earnings fall sharply and stay low for years, while the father’s barely move. This is what researchers have labeled the “child penalty”, and it varies enormously: it is small in the Nordic countries and large in southern Europe.
Despite levying some of the highest taxes on taking a job in the OECD, the Nordic countries pay for the services that make working possible — childcare, preschool and care for elderly parents.
That spending runs at about 6.5 percent of all wages paid in the economy in Norway, 6.1 in Sweden, 4.7 in Finland and 4.6 in Denmark. In Spain it is 1.6 percent, in Italy 1.1 and in Greece 0.6. These are cross-country comparisons, but evaluations of individual childcare reforms mostly point the same way.
Older workers pose a different question: what actually persuades people to remain in the labor market for longer?
Governments have two levers. They can increase the ages built into the pension system, the earliest age at which a pension can be drawn and the age at which it is paid in full. Or they can make working longer pay better, by topping up the pension of those who delay retirement.
Research shows that raising the statutory ages delays retirement substantially, while improving the financial return to postponing retirement achieves much less. People do not appear to treat these ages as a calculation; they read them as a signal of when retirement is due.
Quality jobs for all is two challenges, not one, and they call for different instruments. The policies discussed here are only some of those available, but they share something important: we can now say, from evidence rather than intuition, how well each of them works. Neither challenge is beyond reach.
IEP Bocconi does not express opinions of its own. The opinions expressed in this publication are those of the authors. Any errors or omissions are the responsibility of the authors.
