In a number of cases, together with high marginal tax rates, the legal and regulatory environment in Europe continues to provide a disincentive to take up work and to continue working later on in life. And, there are still, in certain sectors of activity, a large mismatch between skills and vacancies, implying the need for improved education and training.
Finally, wages should more strongly reflect regional and sectoral productivity differences. EU countries also made progress in product market reforms during the 1990s, having positive effects on the integration and level of competition in goods markets, but barriers to competition and innovation in Europe remain.