20 June, 2025 | Xheimina Dervishi and Danielle Brady 

Pathways to a strong social Europe

The COVID-19 pandemic revealed deep weaknesses in social systems across Europe, but it also triggered swift collective responses. Instruments like the Support to mitigate Unemployment Risks in an Emergency (SURE) and the Recovery and Resilience Facility (RRF) demonstrated how quickly and effectively the EU can act when faced with a crisis. Yet five years on, Europe is grappling with new and persistent crises: geopolitical instability, climate threats, and rising living costs. In the REGROUP focus paper “Pathways to a strong social Europe” we ask a crucial question: have we built a stronger, lasting Social Europe or were pandemic-era policies just temporary fixes?

Social Europe is more salient than ever

The rise of populism and declining trust in democratic institutions is closely linked to social and economic exclusion. While social policy remains a national competence, the EU adds value through coordination, standard-setting, and support mechanisms like the European Pillar of Social Rights (EPSR). Austerity and welfare retrenchment have historically fuelled distrust and regressive political behaviour. COVID-19 intensified this trend, with populist actors exploiting public dissatisfaction with health measures. Research suggests that economic insecurity correlates strongly with political distrust and support for populist parties. Therefore, investing in resilient and inclusive welfare systems not only upholds social justice but also reinforces democratic legitimacy and economic stability.

Europeans continue to prioritise social issues. A majority expects a more social EU by 2030, with rising prices, cost of living, and healthcare access topping citizens’ concerns in the 2024 elections. However, priorities differ across Member States, calling for EU policies that better address regional diversity. The COVID-19 pandemic appears to have elevated health-related issues in the public consciousness. As poverty and inequality persist, advancing Social Europe is crucial to maintaining cohesion and ensuring equitable growth amid economic and geopolitical upheaval.

The state of Social Europe: Where are we, and what lessons have we (not) learned?

Although the EU’s commitment to equality is enshrined in its treaties, progress in social policy has been mixed. The EPSR and its Action Plan marked a milestone for Social Europe, backed by measures like the Minimum Wage Directive and the Platform Work Directive. Significant progress includes improved gender equality and declining income inequality, yet millions remain at risk of poverty or social exclusion. Tools like SURE and RRF exemplified rapid EU solidarity, but their temporary design and implementation bottlenecks, including limited absorption capacity, have constrained long-term impact. Challenges such as precarious work, housing affordability, and demographic decline still threaten cohesion and competitiveness. More consistent implementation, adequate funding, and better coordination are needed to meet EPSR goals.

Five years after the onset of COVID-19, the political landscape in Europe has changed significantly: economic pressures, geopolitical tensions and the green and digital transition shifted policy priorities often at the expense of social investment. At the same time, Europe faces serious demographic challenges, including an ageing population, low birth rates, and a shrinking workforce, which are placing growing pressure on welfare systems, healthcare, and pensions. Without sustained social policies, these shifts risk deepening inequalities, reducing economic productivity, and hindering long-term growth. At the same time, growing concerns about funding trade-offs, especially ahead of the 2025 review of the EPSR Action Plan and MFF negotiations, raise doubts about the EU’s commitment to social cohesion. Despite assigning social priorities to a Commission Vice-President, structural reforms remain limited. Without permanent tools like unemployment reinsurance or strengthened income support, the EU risks staying reactive. A narrow focus on GDP and productivity must give way to a more balanced model that sees social investment as key to long-term resilience and fairness.

Six recommendations for our social future

Based on our analysis, in the paper we advance six policy recommendations to strengthen social Europe for the years to come:

1. Break the cycle of Permacrisis: A shift from reaction to prevention. Move from reactive crisis response to long-term preventive strategies through proactive social investment in housing, education, and healthcare. Build adaptive and inclusive welfare systems and create early-warning mechanisms for future risks. 
2. Adopt a long-term framework for future generations. Embed long-term thinking in EU policymaking using tools like a “future generations test,” ensuring that today’s policies do not create tomorrow’s inequalities. Emergency responses should evolve into durable welfare programs.
3. Integrate the European Pillar of Social Rights across all policy domains. The EPSR must guide all EU actions, from fiscal governance to industrial strategy. Conditionalities for EU funding should be linked to social outcomes. MFF allocations must reflect commitments to social justice and resilience.
4. Reform the European Semester. Revise the Semester to include a comprehensive Scoreboard that integrates economic, social, and environmental indicators. Ensure macroeconomic coordination aligns with social cohesion and sustainability.
5. Move beyond GDP-centric approach. Redefine prosperity using wellbeing, inclusion, and sustainability metrics. Support the social economy and ensure that economic strategies include social protections, fair wages, and quality jobs.
6. Strength public-private investments. Scale up investments in social infrastructure by blending public and private funding, especially in sectors like housing, education, and healthcare. Maintain strong public oversight to ensure that equity and inclusion remain central.