Last week erstwhile Italian Prime Minister Mario Draghi published his long awaited report on the future of European competitiveness. For many workers in European industry, hard times have arisen. There is no uncertainty that decisive action and immense investment are essential – not only to recreate European manufacturing tissue, but besides to make an ambitious social agenda that must be founded on quality jobs. Without specified a program, there will be no fair transition – neither green nor digital.
Draghi's study included a number of convincing and imaginative proposals. At the same time, unfortunately, the author completely ignores the essential features of the European model, specified as Social dialogue and Collective agreements.
Industrial strategy
Draghi's study is based on a thorough analysis of the European economy from a global perspective. Drawing from the awesome data set, Draghi approaches comprehensively to Industrial strategy, providing diagnosis and proposals for innovation, skills, trade, competition and energy markets.
It is worth noting that a study is appearing at the threshold of a fresh political cycle in Europe, which underlines that the future of manufacture is the biggest challenge facing the European Union. Federation of industrial All Europe, a union of industrial workers, Talks about it. from the very beginning of the 2021 energy crisis. Draghi does not avoid questioning the sanctity of the European Union, specified as competition law, trade policy or energy markets, due to the fact that he believes that it is strategically crucial for Europe to keep a strong industrial base.
The study examines 10 economical sectors in depth, highlighting the difficulties facing these sectors. The conventional industries, including mining, construction and energy industries, should be recognised as well as the modern technology sectors. Trade unions have been saying for years that these sectors of the economy are interlinked and complementary: Europe will not be an industrial power if it focuses solely on "sustainable" clean technologies and neglects the basic sectors at the very beginning of the advanced technology supply chain. Draghi besides proposes to remove the link between electricity prices and gas prices – it is these unorthodox concepts that urgently request energy-intensive industries that are facing present high current prices.
Social Agenda
While a strategical view of European manufacture is simply a strong side of Draghi's report, its Achilles heel is simply a complete deficiency of link between this strategy and the genuine EU Social agenda. The study mentions that the competitiveness of EU manufacture must not be based on reducing labour costs and should go hand in hand with social integration, but we will not find any specifics there.
On the contrary: social dialogue, collective agreements and importance are virtually absent on the 400 pages of the study social aspects investments. The social agenda requires proposals that go much further than, otherwise notable, to guarantee that all workers training rights.
A completely disproportional focus of the study is on productivity. The weak economical growth of EU Draghi explains the weak growth in labour productivity, claiming that it is in turn liable for slow wage growth and understates request on national markets.
Draghi rightly argues that in order to improve competitiveness, "the force to lower wages should not be utilized to reduce comparative costs". However, low productivity is not only a origin – it is besides a consequence of the greed of business. The decline in wages in income, which began in the early 1980s, is not only an alleged effect of industrial automation, but besides direct result a immense increase in the share of profits during that period.
Most of these evidence profits hit shareholders' pockets, not employees'. However, Draghi's study completely disregards the question of fair distribution of generated wealth, although it was low wages that contributed to the simplification in home demand. In turn, failure to invest adequate surpluses has hampered innovation – so besides productivity – and indirectly demand.
Large investments
Draghi calls for large-scale investment to decarbonise and digitize the economy. In his opinion, they should be advanced adequate to bring the ratio of investment to GDP back to the level known in the 1960s and 1970s. We agree to this appeal. Fair Transformation the carbon-based economy and the equally fair digitalisation of the economy will not take place without ambitious investments.
However, public investment needs to take account of social issues – in order to guarantee that public funds go only to companies that invest and produce in Europe, they supply permanent and unionised jobs, while respecting collective agreements and labour rights.
Moreover, all these industries trust on high quality public servicesTo whom we owe safe, healthy and educated society. Belt tightening policy resulting from renewed (and revised) fiscal rules agreed by EU governments is not reconciled with this imagination of investment.
The study states that regulation is simply a burden for European industry. However, he does not give convincing arguments to support this argument, but simply cites the acquainted statements of employers, representing this point of view. If Europe far ahead another regions of the world, including the United States, in terms of surviving standards (e.g. life expectancy at birth), possibly this is mostly due to the fact that regulations in the Union supply greater protection for workers and society as a whole.
Each strategy can be simplified and streamlined, but the rules in force in the EU be to guarantee that private business activities fall within the limits of the public good. Strong social and environmental safety is needed to guarantee that changes to regulations are not carried out cost the fundamental interests of European societies.
Political will
Finally, the question remains what circumstantial actions the Draghi study will translate into, peculiarly in the current context an expanding wave of nationalisms and fiscal consolidation, which in most EU countries leads straight to a strict belt tightening policy. As always, everything will turn out in practice.
If the European Commission and the governments of the associate States proceed with plans to reduce costs and make the labour marketplace more flexible, the study will only stay an academic exercise. What is needed is the political will to implement a genuinely European strategy covering investment and social issues that will warrant good jobs..
**
Judith Kirton-Darling is the Secretary General of the Federation of trade unions industrial All European. She was the secretary of the European Trade Union Confederation and held the mandate of a British associate of the European Parliament from 2014 to 2020.
Isabelle Barthès is simply a deputy secretary of the General Federation of trade unions of industryAll Europe.
Article published in stock Social Europe. He translated Marek Jedliński from English.
