Premier Matteo Renzi's controversial Jobs Act labour reform was lauded Thursday by a senior official with the European Commission as being positive for youth even as a separate EC report said Italy has not done enough for young Italians.
"(It) is a reform that is very positive and will help young people in particular," Jyrki Katainen, economic affairs commissioner for the European Commission told the Italian parliament.
"The Jobs Act will help hires and it is fairer on young people," Katainen said to a joint session of the Senate and Lower House.
However, even as he spoke, a European Commission report said that Italy was not doing enough to help its young people find employment.
The report on Employment and Social Development by the Commission said that Italian policies "to address the low participation of young people in the labor market seem limited".
The unemployment rate in Italy overall rose to 13.4% in November while at the same time, it hit 43.9% for available workers between 15 and 24 years of age.
The report suggested that Italy devotes more attention and resources to protecting pensions and the welfare of older workers, to the exclusion of younger Italians.
In Rome, Katainen, the former prime minister of Finland, also praised the whole of the ambitious programme of structural reforms the Renzi executive has embarked on. "All the Italian government's reforms are just and important and they will increase competitiveness," he said. Significant reforms to civil justice system is particularly key for business certainty and investment, he said later after meeting with Justice Minister Andrea Orlando.
Katainen told parliament that in reviewing Italy's budget, the Commission may be able to exploit new flexibility on investments created by the EC in a recent ruling that could benefit several countries. "It's possible," he said, depending on spring economic forecasts. He also warned that the EC may yet demand Italy present some corrective measures for the its 2015 budget, now under review by the commission.
"We will evaluate," said Katainen.
The EC is expected to give a final decision on the Italy measures in the spring.
One day earlier, Italy's Economy Minister Pier Carlo Padoan again ruled out corrective measures, as he has done in the past.
The Jobs Act gives gradually rising levels of labour protection to people hired on open-ended permanent contracts, but it also softens protection against unfair dismissal.
The aim is to replace a plethora of temporary and other low-paying, no-benefits contracts that have proliferated in Italy in recent years, meaning a regular full time job is increasingly hard to find.
Renzi said the labour law will encourage firms to hire new staff and help combat unemployment, which has reached a record high of over 13% in recession-battered Italy, with young people hit especially hard.
The bill passed despite staunch resistance in parliament from several opposition parties and a minority within Renzi's own centre-left Democratic Party (PD).
The reform has also raised high-voltage protests from two of Italy's three big trade-union confederations, the CGIL and UIL, which staged a general strike against it and the government's 2015 budget law on December 12.
The main bone of contention are changes to Article 18 of the 1970 Workers Statute, which protects people from unfair dismissal, for newly hired workers.
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