Speaking on a panel at IF Metall’s Congress in Örebro, Judith Kirton-Darling, industriAll Europe’s General Secretary, set out industriAll Europe’s concerns about the impact of increased geopolitical instability and Trump’s tariffs.
The panel discussed trade union rights, democracy, and what impact recent trade and tariff announcements will have globally on European workers, and particularly in Sweden, and what can be done.
Judith Kirton-Darling stressed that Europe must protect its workforce. The countermeasures, tariff and trade instruments that the EU will deploy in response to the escalating trade war with the United States will not be enough to protect working people. We must not overlook the employment dimension: protecting employment must be an immediate priority.
The success of the measures in the EU’s SURE initiative, which protected jobs and livelihoods during the COVID-19 pandemic, must be urgently reintroduced. Support should be available to safeguard jobs in companies impacted by tariffs, but it should not be used to increase profits or for shareholder dividends. Europe needs an effective emergency plan that must include measures to control profiteering and limit increases in the prices of essentials, especially food.
Trade is an important driver of Europe’s prosperity. More than 30 million jobs are supported by EU exports to third countries, representing 14.5 % of total EU employment. These jobs are related to high added-value and innovative sectors, and they are well-paid quality jobs compared with the average. But internal demand must be boosted. Wages and purchasing power must be protected and increased. Major investments are also needed to get ahead in the technologies and infrastructures of the future. A permanent investment tool, based on common debt instruments, as well as a rethink of the EU’s economic governance rules, are essential. Europe cannot overcome this crisis with its economic and financial hands tied behind its back.
Tariffs will hurt the EU industry directly and indirectly. Directly because the EU has a significant trade surplus with the US ($205 bn in 2023), notably in sectors such as automotive. And indirectly because of the trade diversion that will exacerbate the already existing unfair competition due to global overcapacity, mainly from China.
These tariffs are unjustified and not based on reality. They are not aimed at ending unfair competition, for example exports coming from countries with bad labour standards and very low wages. They are instead aiming for maximum damage to European production and workers in the EU. And the US will be hit with increased prices and, unless emergency measures are taken, job losses will likely follow.
The world is changing, and status quo is not an option, but building economic walls is neither feasible nor desirable. Trade that is fair and regulated must remain an important part of the EU economic strategy. We need imports from third countries (energy, raw materials, intermediate goods, including clean tech) and exports on global markets.
It’s time to develop a progressive, rules-based trade that is open, just and sustainable, providing equal rights and benefits for workers and citizens, with the ILO, as global leader in social regulation, and working with the WTO and the UN to regulate multilateralism. It is important for the EU to continue to seek negotiated solutions, while safeguarding its economic and employment interests.
“Our context has fundamentally changed, and we must find our balance in the shifting sands. Our prosperity has been based on trade with the rest of the world – 30 million jobs depend on it in Europe, but we need to find a new balance through a proactive industrial policy and cooperation with partners elsewhere in the world. Workers need a strong signal from our political leaders to reduce uncertainty and ensure they are safeguarded”, highlighted Judith Kirton-Darling.
Limiting the response to trade retaliation measures will not protect jobs. Instead, a dual approach is needed: a SURE-style job protection mechanism, coupled with a permanent investment facility, up to the task of prioritising quality jobs in a volatile geopolitical environment, and a proactive European industrial policy strategy focused on stimulating internal demand for European manufacturing value chains within the European market.
“The EU needs a strong, coordinated response that prioritises safeguarding jobs, supports our industries, and strengthens our manufacturing base. Investing in European industry and supporting its workers is essential to securing our long-term stability. Europe needs to implement a well-resourced industry that responds to the challenges faced by the targeted sectors and our wider industrial fabric”, added Judith Kirton-Darling.