Ludovic VOET

Confederal Secretary at European Trade Union Confederation (ETUC)

Europe is losing industrial jobs, productive capacity and economic sovereignty. The debate on the Industrial Accelerator Act is not about protectionism versus openness. It is about whether Europe chooses to manage industrial decline or build a clean industrial future that delivers quality jobs, regional cohesion and strategic autonomy.

What Europe is facing is not an abstract competitiveness problem but deindustrialisation. Across the continent, workers are watching factories close, investments disappear and production relocate. Entire communities that built Europe’s prosperity through steel, chemicals, automotive manufacturing, machinery and countless other industries are increasingly being told that decline is inevitable. The message is always the same: global competition leaves no alternative.

Workers have heard this argument for decades. The result is visible everywhere. Europe has lost industrial capacity, increased its strategic dependencies and weakened parts of its productive base. Entire regions have been left struggling to replace well-paid industrial jobs with lower-paid and more precarious employment. Every major crisis, from the pandemic to the energy shock, has exposed the fragility of supply chains that were supposed to deliver efficiency and resilience.

The lesson should be clear by now. Deindustrialisation is entirely the consequence of political choices, not an economic law. That is why the debate around the Industrial Accelerator Act (IAA) matters. The discussion is often presented as a choice between openness and protectionism, between free markets and state intervention. This framing is misleading. The real question is whether Europe wants to maintain the industrial capacity necessary to guarantee prosperity, social cohesion and strategic autonomy in the decades ahead.

For trade unions, the answer is obvious. Europe needs a stronger industrial policy because workers need a stronger industrial future. Rather than preserving the industries of the past, the European Union shall shape those of the future. The green and digital transitions will require massive investments in batteries, clean technologies, renewable energy equipment, low-carbon materials, digital infrastructure, transport systems and advanced manufacturing. The question is towards which objectives they will grow.

Will Europe create the factories, technologies and jobs associated with this transformation? Or will it increasingly depend on imports while exporting investment opportunities and industrial employment? Europe cannot lead the climate transition while accepting the erosion of its industrial base. 

Climate neutrality and reindustrialisation must go hand in hand. People will not support ambitious climate policies if they associate them with factory closures, insecurity and declining living standards. They will support them if they create stable jobs, new opportunities and economic renewal. 

That is why industrial policy is not only an economic issue, but also it is as a social, territorial and ultimately a democratic issue. Every region in Europe deserves a place in the industrial transition. For too long, economic success has been concentrated in a limited number of regions while others have experienced industrial decline and population loss. Workers in industrial regions must be able to see a future for themselves and their children. This requires moving beyond the assumption that markets alone will deliver the outcomes Europe needs.

Every major economy is actively shaping industrial development. China’s industrial subsidies are estimated at around 4.4 per cent of GDP. Combined with state-directed investment, favourable financing conditions and targeted industrial support, this can translate into cost advantages estimated at between 20 per cent and 40 per cent in key sectors. The United States has embraced industrial policy on a scale unimaginable a decade ago. Governments across the world are actively supporting domestic production and technological development. Europe cannot remain the only major economic power pretending that refusing to act is a form of neutrality. Supporting European production is not protectionism. Of course, Europe should remain open to trade and investment. It does not need to produce everything within its borders. But openness cannot mean naivety. 

Europe has no reason to subsidise investments that create new dependencies, weaken domestic value chains or generate private profits while leaving little lasting benefit for workers and communities. Public support must come with public obligations. Companies benefiting from public money should respect workers’ rights, collective bargaining, fair taxation and environmental standards. Public support should strengthen industrial ecosystems, not simply improve corporate balance sheets. The same principle should apply to European and foreign companies alike. Whether investment creates value in Europe is more important than the nationality of capital.

Critics frequently focus on the costs associated with European preference measures. Yet perspective matters. Estimates suggest compliance costs of around €6 billion annually for businesses and around €1 billion for public authorities. These figures are often presented as evidence that industrial policy is unaffordable. In reality, they are modest compared with the economic and social costs of industrial decline. Europe is already paying a far higher price through factory closures, lost productive capacity, strategic dependencies and the disappearance of quality jobs across industrial regions.

Nor would a stronger European preference be exceptional. Under ‘Buy American’ rules, US authorities apply price preferences of up to 30 per cent in civilian procurement and even higher evaluation factors in defence procurement. China and other major economies also extensively use domestic preference mechanisms. The idea that Europe should remain uniquely neutral while others actively support domestic production is neither economically realistic nor politically sustainable.

This is also why ‘made in Europe’ must mean more than a label attached to a product. Made in Europe must mean made with quality jobs. A race to the bottom on labour standards cannot be Europe’s competitive advantage. Quality jobs, strong collective bargaining and social dialogue are not obstacles to economic success. They are essential conditions for sustainable growth, productivity and innovation.

Industrial policy should therefore be judged not only by output, exports or investment figures, but also by the quality of employment it creates and the resilience of the communities it supports. Europe needs an industrial strategy capable of delivering quality jobs, technological leadership, economic security and a just transition.

Rather than debating openness versus protectionism, Europe must choose between managing decline and organising renewal. Between accepting deindustrialisation as inevitable or deciding that Europe’s workers, industries and regions deserve a future. The Industrial Accelerator Act can become an important step towards that future. But only if it is ambitious enough to match the scale of the challenge. Europe’s industrial future is not a technical question. It is a political choice.

Photo credits: Shutterstock/Alexandros Michailidis