EU employment and social situation : quarterly review; September 2014: Supplement

This supplement briefly reviews a set of indicators that complement Gross Domestic Product (GDP) growth. They provide a more comprehensive measure of growth in society, encompassing not only macro-economic performance but also progress in other important aspects of sustainable and inclusive growth. Building on the chapter on Indicators of inclusive growth to complement GDP growth of ESDE 2013, which contributed to the 'Beyond GDP' debate, this supplement updates some of the ESDE analysis and examines social aspects and distributional trends since the first half of the 2000s. First, it sketches the situation across the EU and then looks at selected Member States. GDP is the most widespread measure of macro-economic performance. In order to reflect progress in our societies more broadly, it needs to be complemented by measures of environmental sustainability and social progress. The limitations of GDP as a measure of key societal goals such as well-being and sustainable development are widely recognised,notably in the report by Stiglitz et al. (2009). At political level, the 'Europe 2020' strategy, which is based on a vision of smart, sustainable and inclusive growth, acknowledges that improvements brought about by economic growth ought to be distributed widely and fairly to all individuals in society. In the global arena, discussion is now underway to set up a new post-2015 framework for sustainable development, where goals that are supported by indicators other than GDP, including a focus on social cohesion, would help direct policies towards more inclusive and sustainable growth. A set of indicators is reviewed here which complement GDP per capita growth as a measure of the socio-economic progress of societies. They focus on distributional measures in particular. These indicators cover growth in average and median household income, including for specific income quintiles, as well as inequality indicators and inequality-adjusted growth in GDP per capita.