Speaking today at the high level dialogue with social partners, Judith Kirton-Darling, industriAll Europe’s general secretary conveyed industriAll Europe’s demands for a clear European industrial strategy and proactive industrial policy to avoid plunging Europe further into deindustrialisation.
Falling industrial production figures, particularly in our manufacturing heartlands, show that we are at a crossroads. As a result of the lack of a clear European industrial strategy and plan, bad corporate decisions, and lagging investment in industry, deindustrialisation is no longer a threat, but rather a reality.
Europe is dealing with massive restructuring, not only in incumbent industries, like the automotive, steel or chemical industry, but also in new, net-zero industries, like the battery or wind energy manufacturing industries. Europe is now on the brink of losing ground in industries in which it is a global market leader.
There can no longer be a business-as-usual scenario for European industry. The main impediment that industry is currently facing in Europe is a lack of demand, and if purchasing power and real wages continue to fall, the situation will deteriorate even further.
As has been argued in both the Letta and Draghi reports, Europe needs an unprecedented scale of investment to reverse the current trend towards deindustrialisation. As Draghi also recognises and points out in his recent report: the EU’s competitiveness cannot be built on social cost-cutting.
As industriAll Europe has repeated many times, Europe needs unprecedented investment in upskilling and retraining, and in innovation and social cohesion. This demands a permanent EU investment mechanism and a Just Transition Directive to anticipate and manage the industrial change underway. IndustriAll Europe has long argued for a proactive industrial policy.
“We welcome the new European Commission prioritising a Clean Industrial Deal for quality jobs, but unfortunately, we cannot transform an industry that has already been lost. We urgently need a moratorium on forced redundancies, a SURE 2.0 scheme to bridge the investment gap and to create space. We must avoid the loss of strategic industrial capacity.
We call for strong social conditionalities on all public support to industry. Public money must be leveraged, and auctions and contracts need to be made to lock in private investment in Europe for quality jobs”, stressed Judith Kirton-Darling, industriAll Europe’s general secretary.
Evidence shows that investment with social conditionalities works. Companies are currently far more willing to invest in the U.S. than in Europe, despite the inclusion of binding social and fiscal conditionalities in the Inflation Reduction Act (IRA). We can see this with the North American market, that has attracted 11% more electric vehicle sector investment between 2021 and 2023, compared to Europe, despite Europe being the bigger producer. Recently, Stellantis diverted a whopping 74% of its electric vehicle investments to North America.
“We are at an economic crossroads. Do not dither! Choose the right direction, for Europe, and for good industrial jobs”, concluded Judith Kirton-Darling.