Sustainable business and labour practices How to avoid the risks of industrial decline
Italian industry is going through a challenging period: industrial production has been in decline for almost two years (22 months to be precise) and only 6% of companies see an improvement in the economy (Bankitalia survey); “La Repubblica”, 15 January) and Confindustria is not hiding its serious concerns either. Its president Emanuele Orsini has highlighted the negative impact of high energy prices (Italy has the highest prices in Europe, which is unsustainable for industry) and the risks of increased tariffs (which the new US president, Donald Trump, has also announced for the EU). He has therefore called on the government in Rome and the Commission in Brussels to draw up an “industrial plan” that prioritises energy (starting with nuclear power) and the recovery of productive investment (Il Sole24Ore, 26 January).
In a nutshell, there are dark clouds on the economic horizon, with Germany, a former manufacturing giant and industrial engine for the whole of Europe, still in trouble, especially in the automotive sector, and with EU growth down to 1% in 2025 (there was talk of 1.2% in October). Growth in Italy is slightly worse: 0.6% in 2024 (the government hoped it would be 1%) and 0.7% in 2025.
“Industry is struggling, but no one is worried”, criticises Ferruccio de Bortoli (“Corriere della Sera”, 18 January), pointing out that Palazzo Chigi is not paying attention to the poor productivity performance and the shadow cast over exports, Italy’s traditional strength.
The issue of the industrial crisis is by no means a marginal one. And we certainly cannot console ourselves with the positive data on GDP and employment that come from the solid results in tourism. Apart from the negative factors caused by an increasingly excessive and overwhelming tourist presence (known collectively as “overtourism”), especially in cities of art and in the most ecologically fragile places, the fact remains that tourism is an essential component of GDP and a source of income, work and widespread well-being, but it is also subject to a certain volatility of flows, generates work that is sometimes seasonal, precarious and poor, and in any case does not affect the political and strategic influence of a country in the international context.
A few months ago, in an attempt to stir up a sense of urgency about Europe’s slide into decline, the Financial Times warned Brussels and other capitals of the danger of Europe quickly becoming a Grand Hotel, where the world’s rich and powerful go for elegant and lavish holidays.
To avoid this, we need to return to the centrality of industry, to quality production that stimulates innovation and change and produces resources in the long term, to production choices that address issues related to energy (and therefore security) and durable goods, to skilled collaboration between industry and research, to major strategic production and competitive options.
“Building the future of industry and our country“, is how Foreign Minister Antonio Tajani (Il Sole24Ore, 25 January) puts it, insisting on the need to “strengthen and defend the pillars of Italian manufacturing and Made in Italy”, namely “food, fashion, furniture, design and technology” and to prioritise “strategic industrial sectors for security, health and social development, such as pharmaceuticals, defence/aerospace and information technology”. He speaks of decisions to combat the crisis in the automotive sector (the car industry has declined by 34% in two years) and appeals to the responsibility of Brussels: “Stopping economic decline is a European challenge.”
How? By looking more closely at the data and facts, and within the general framework of the crisis, looking for the factors that can be used to implement actions and commitments for recovery. Taking into account the opinion of leading economists and the conclusions of the latest Symbola report “Italy in 10 Selfies” on Italy’s positive achievements.
Let’s take a closer look. “Made in Italy is an industrial heritage to be protected and invested in,” says Marco Fortis, vice-president of the Edison Foundation, an economist who is one of the most aware and well-informed on the state of Italian industry (“Il Soile24Ore”, 16 January). Italy remains firmly in fourth place in the world export rankings, behind China, the USA and Germany and ahead of France, Japan and South Korea, excluding motor vehicles (which account for only 8% of world exports). This means that in the main manufacturing sectors, Italian industry continues to be competitive, especially in the higher value-added niches of mechanics and mechatronics, robotics, pharmaceuticals and chemicals, rubber and plastics, aerospace, luxury shipbuilding, furniture, clothing and agri-food.
It’s true, we have a low productivity problem. We are severely impacted by the demographic crisis and the shortage of skilled labour (already a serious problem and destined to deteriorate in the future). High energy costs and the difficulties associated with inefficient bureaucracy and high taxation are having a negative impact. But despite all this, we persevere.
We cannot rely for long on the abilities of the “Italian genius”, especially in the face of technological evolution. But we still have some good cards in our hand.
“It’s not a debacle, our industry remains competitive”, confirms Gregorio De Felice, Intesa Sanpaolo’s chief economist (Corriere Economia, 20 January), speaking of a “cyclical and not structural crisis” (with the exception of the automotive sector), of geopolitical uncertainties, of limits linked to the difficult application of the rules of Industry 5.0, the postponement of investments while waiting for the fall in interest rates, but also the positive factors linked to the transformation of a large part of the Italian industrial apparatus, after the great crisis of 2008/2009, in the direction of better and higher productivity: “Italian companies have a greater capacity to react than their German counterparts”.
Italy has another strength: the significant number of our companies that consider sustainability, both environmental and social, as a fundamental competitive advantage (Pirelli has long been an exemplary case), rather than a marketing and communication choice or a clever greenwashing positioning.
There is no doubt that these are troubled times, with a geopolitical landscape of contrasts and conflict. And with the growing disengagement of major international players (starting with the US, with Donald Trump’s new presidential strategy) in terms of ESG guidelines and restrictions to combat climate change. The Green Deal is being called into question. And even within the EU, there is a critical reflection on the damaging rigidity of the environmental policies pursued so far (bureaucratic and ideological, say the critics, thinking in particular of the decisions on the primacy of electric cars and the fines for internal combustion engines). The aim is to quickly arrive at new environmental and social policies based on compliance with ESG objectives, but also on “technology neutrality” to achieve them. A new Green Deal generation, at the heart of which is the defence and revival of the centrality of European industry in the face of competition from the US, China and, soon, India.
Returning to Italy, as noted, the annual report “Italy in ten selfies” by the Symbola Foundation and Unioncamere (Il Sole24Ore, 14 January) contains some very interesting information. It accurately documents Italy’s record performance in the circular economy (the best in Europe for the recycling of special and urban waste: 91.6%, against an EU average of 57.9%), for “green” steel (the share of steel produced using the electric arc furnace cycle is 86%, against 68% in the US), for the strength of the world’s largest operator in renewable energy among listed utilities (Enel, through Enel Green Power), and for Made in Italy, which is at the forefront of organic farming companies and export capacity in the pharmaceutical and furniture sectors.
We compete well and sustainably: “Italy grows when it does Italy well”, confirms Ermete Realacci, president of Symbola. In other words, “it is at its best when it crosses its hostoric DNA with an uniquely Italian way of doing business, which combines innovation and tradition, social cohesion, new technologies and beauty, the ability to speak to the world without losing touch with its regions and communities”.
In short, a productive sustainability that is sensitive to both environmental and social issues (work, general well-being). And it respects competitiveness and development. An industrial sustainability. A good way to grow better.
(Photo Getty Images)
Italian industry is going through a challenging period: industrial production has been in decline for almost two years (22 months to be precise) and only 6% of companies see an improvement in the economy (Bankitalia survey); “La Repubblica”, 15 January) and Confindustria is not hiding its serious concerns either. Its president Emanuele Orsini has highlighted the negative impact of high energy prices (Italy has the highest prices in Europe, which is unsustainable for industry) and the risks of increased tariffs (which the new US president, Donald Trump, has also announced for the EU). He has therefore called on the government in Rome and the Commission in Brussels to draw up an “industrial plan” that prioritises energy (starting with nuclear power) and the recovery of productive investment (Il Sole24Ore, 26 January).
In a nutshell, there are dark clouds on the economic horizon, with Germany, a former manufacturing giant and industrial engine for the whole of Europe, still in trouble, especially in the automotive sector, and with EU growth down to 1% in 2025 (there was talk of 1.2% in October). Growth in Italy is slightly worse: 0.6% in 2024 (the government hoped it would be 1%) and 0.7% in 2025.
“Industry is struggling, but no one is worried”, criticises Ferruccio de Bortoli (“Corriere della Sera”, 18 January), pointing out that Palazzo Chigi is not paying attention to the poor productivity performance and the shadow cast over exports, Italy’s traditional strength.
The issue of the industrial crisis is by no means a marginal one. And we certainly cannot console ourselves with the positive data on GDP and employment that come from the solid results in tourism. Apart from the negative factors caused by an increasingly excessive and overwhelming tourist presence (known collectively as “overtourism”), especially in cities of art and in the most ecologically fragile places, the fact remains that tourism is an essential component of GDP and a source of income, work and widespread well-being, but it is also subject to a certain volatility of flows, generates work that is sometimes seasonal, precarious and poor, and in any case does not affect the political and strategic influence of a country in the international context.
A few months ago, in an attempt to stir up a sense of urgency about Europe’s slide into decline, the Financial Times warned Brussels and other capitals of the danger of Europe quickly becoming a Grand Hotel, where the world’s rich and powerful go for elegant and lavish holidays.
To avoid this, we need to return to the centrality of industry, to quality production that stimulates innovation and change and produces resources in the long term, to production choices that address issues related to energy (and therefore security) and durable goods, to skilled collaboration between industry and research, to major strategic production and competitive options.
“Building the future of industry and our country“, is how Foreign Minister Antonio Tajani (Il Sole24Ore, 25 January) puts it, insisting on the need to “strengthen and defend the pillars of Italian manufacturing and Made in Italy”, namely “food, fashion, furniture, design and technology” and to prioritise “strategic industrial sectors for security, health and social development, such as pharmaceuticals, defence/aerospace and information technology”. He speaks of decisions to combat the crisis in the automotive sector (the car industry has declined by 34% in two years) and appeals to the responsibility of Brussels: “Stopping economic decline is a European challenge.”
How? By looking more closely at the data and facts, and within the general framework of the crisis, looking for the factors that can be used to implement actions and commitments for recovery. Taking into account the opinion of leading economists and the conclusions of the latest Symbola report “Italy in 10 Selfies” on Italy’s positive achievements.
Let’s take a closer look. “Made in Italy is an industrial heritage to be protected and invested in,” says Marco Fortis, vice-president of the Edison Foundation, an economist who is one of the most aware and well-informed on the state of Italian industry (“Il Soile24Ore”, 16 January). Italy remains firmly in fourth place in the world export rankings, behind China, the USA and Germany and ahead of France, Japan and South Korea, excluding motor vehicles (which account for only 8% of world exports). This means that in the main manufacturing sectors, Italian industry continues to be competitive, especially in the higher value-added niches of mechanics and mechatronics, robotics, pharmaceuticals and chemicals, rubber and plastics, aerospace, luxury shipbuilding, furniture, clothing and agri-food.
It’s true, we have a low productivity problem. We are severely impacted by the demographic crisis and the shortage of skilled labour (already a serious problem and destined to deteriorate in the future). High energy costs and the difficulties associated with inefficient bureaucracy and high taxation are having a negative impact. But despite all this, we persevere.
We cannot rely for long on the abilities of the “Italian genius”, especially in the face of technological evolution. But we still have some good cards in our hand.
“It’s not a debacle, our industry remains competitive”, confirms Gregorio De Felice, Intesa Sanpaolo’s chief economist (Corriere Economia, 20 January), speaking of a “cyclical and not structural crisis” (with the exception of the automotive sector), of geopolitical uncertainties, of limits linked to the difficult application of the rules of Industry 5.0, the postponement of investments while waiting for the fall in interest rates, but also the positive factors linked to the transformation of a large part of the Italian industrial apparatus, after the great crisis of 2008/2009, in the direction of better and higher productivity: “Italian companies have a greater capacity to react than their German counterparts”.
Italy has another strength: the significant number of our companies that consider sustainability, both environmental and social, as a fundamental competitive advantage (Pirelli has long been an exemplary case), rather than a marketing and communication choice or a clever greenwashing positioning.
There is no doubt that these are troubled times, with a geopolitical landscape of contrasts and conflict. And with the growing disengagement of major international players (starting with the US, with Donald Trump’s new presidential strategy) in terms of ESG guidelines and restrictions to combat climate change. The Green Deal is being called into question. And even within the EU, there is a critical reflection on the damaging rigidity of the environmental policies pursued so far (bureaucratic and ideological, say the critics, thinking in particular of the decisions on the primacy of electric cars and the fines for internal combustion engines). The aim is to quickly arrive at new environmental and social policies based on compliance with ESG objectives, but also on “technology neutrality” to achieve them. A new Green Deal generation, at the heart of which is the defence and revival of the centrality of European industry in the face of competition from the US, China and, soon, India.
Returning to Italy, as noted, the annual report “Italy in ten selfies” by the Symbola Foundation and Unioncamere (Il Sole24Ore, 14 January) contains some very interesting information. It accurately documents Italy’s record performance in the circular economy (the best in Europe for the recycling of special and urban waste: 91.6%, against an EU average of 57.9%), for “green” steel (the share of steel produced using the electric arc furnace cycle is 86%, against 68% in the US), for the strength of the world’s largest operator in renewable energy among listed utilities (Enel, through Enel Green Power), and for Made in Italy, which is at the forefront of organic farming companies and export capacity in the pharmaceutical and furniture sectors.
We compete well and sustainably: “Italy grows when it does Italy well”, confirms Ermete Realacci, president of Symbola. In other words, “it is at its best when it crosses its hostoric DNA with an uniquely Italian way of doing business, which combines innovation and tradition, social cohesion, new technologies and beauty, the ability to speak to the world without losing touch with its regions and communities”.
In short, a productive sustainability that is sensitive to both environmental and social issues (work, general well-being). And it respects competitiveness and development. An industrial sustainability. A good way to grow better.
(Photo Getty Images)