The European Commission has published its 2026 European Employment and Social Outlook, finding that EU job quality improved over the past decade in pay, job security and working time. Progress remains uneven across countries, sectors and occupations. Jobs with lower pay, less security and atypical hours often face more acute labor shortages, indicating that better conditions could help employers attract and retain workers while supporting productivity. Job quality is generally higher in manufacturing, knowledge intensive services, finance, public administration and professional activities than in accommodation, food and lower skilled services. The report links sustained wage growth to productivity gains, while finding that higher wages, particularly minimum wages, can encourage investment and innovation. Artificial intelligence could improve productivity and allow workers to focus on higher value tasks, but it may reduce demand for some routine and entry level roles, affect working conditions and widen skills gaps if less experienced workers cannot identify errors in automated outputs. The EU employment rate reached 76.1% in 2025, while unemployment remained at a historic low of 6%. For 2026, Commission analysis indicates that the energy shock linked to the Middle East conflict is likely to slow hiring, with around 440,000 fewer jobs expected to be created, although employers are expected to retain existing workers. The Commission plans to present the Quality Jobs Act later in 2026 following its second phase consultation with EU social partners.

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