Industrial restructuring

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'The European Parliament … believes that the current climate of industrial change necessitates a review and an updating of existing legislation.’
- EP Resolution on the social consequences of restructuring, 2001

The information on this page is also available for download as a pdf file.

Industrial restructuring is a striking feature of the economic landscape in Europe today. However, patterns of restructuring vary from one country to another and across sectors. Downsizing, outsourcing and layoffs are still part of the traditional response to the fragile economic climate and uncertainties. In recent times, more imaginative approaches look at further options such as training breaks, sabbaticals, job-sharing, remote working and reduced working hours as part of what is called 'reflective restructuring'. Whatever the approach, restructuring represents an attempt at managing and anticipating change, simultaneously tackling issues of economic, social and environmental significance.

The European Monitoring Centre on Change (EMCC) is a concrete reflection of the concern, at the highest European level, of the far-reaching effects of restructuring. Proposed by the high-level group on industrial change, it was supported by the European Parliament, Commission and social partners. In 2001, the European Council established the EMCC within the European Foundation for the Improvement of Living and Working Conditions. One of its principle aims is to help offset the negative long-term impact of restructuring by examining how best to manage and anticipate social and economic change in our society.

The Foundation offers a wide variety of online information sources on the subject of industrial restructuring:

An EMCC dossier on industrial restructuring with links to a wide range of related publications.
The European Restructuring Monitor (ERM), managed by EMCC, provides news and analysis on company restructuring in Europe, using statistics to compare countries, sectors and types of restructuring.
The European Industrial Relations Observatory (EIRO) is another rich source of regular news and analysis of all aspects of industrial relations, including restructuring.

This fact sheet outlines different facets of restructuring and provides links to a large body of relevant Foundation work on this important subject.

Sectoral impact of restructuring

Some sectors have been harder hit than others in the trend towards restructuring in the marketplace. The response has been equally varied.

EMCC dossier on the crisis in the steel sector, 2003
Against the background of Arcelor’s announcement of large-scale restructuring plans, the European Parliament adopted a resolution on 13 February 2003 on the crisis in the steel sector. This dossier provides full details of the crisis, as well as making available selected case studies on the sector.

Consolidation in the financial sector, 2001
Looking at restructuring in the financial services sector, this report examines the potential effects on monetary policy, competition and credit flows, and payment and settlement systems. Developments in the financial services sector (pdf file) looks at the developments in the financial services sector since 1999.

Outsourcing and industrial relations in motor manufacturing, 2000
This comparative study examines the impact of outsourcing on industrial relations in the EU (plus Norway), focusing on the motor industry.

The impact of industrial restructuring on the tourism sector, 2002 (pdf file)
The attacks of 11 September 2001 and the global economic downturn have had a negative impact on the European tourism sector. This report looks at the industry’s response to these changes.

The impact of recent industrial restructuring in the ICT sector, 2002 (pdf file)
As a result of economic and financial globalisation and the downturn in the US technology sector, the ICT sector is under increasing pressure. This report looks at the sector's response.

Report on the aviation sector, 2002 (pdf file)
In the wake of the attacks of 11 September 2001, the airline industry has suffered further economic uncertainty. This report looks at the industry's response through restructuring, redundancy, layoffs, etc.

Mergers and acquisitions

One of the most prevalent approaches to restructuring in Europe today, mergers and acquisitions are increasingly subject to control at EU level. There is also increasing scepticism that mergers actually improve a company’s profitability and productivity.

Industrial relations aspects of mergers and takeovers, 2001
This comparative study looks at the industrial relations aspects of mergers and takeovers. It examines the EU-level regulation, the role of public authorities, the impact on jobs and collective bargaining, cross-border mergers and takeovers, European Works Councils, and the views of the social partners.

Mergers in Europe (DOME) database
The DOME database was created at the Kiel Institute of World Economics in order to improve the data source for empirical research on mergers in Europe.

Private equity deals as a chance for business turnaround: where and how did it work?
This report presents the main issues discussed at the EMCC’s first workshop in May 2002 dealing with the influence of financial markets on change in companies and sectors. Participants included experts from Europe and the United States who had managed turnaround in businesses in different sectors.

Collective bargaining/agreements

The effects of company restructuring are a constant cause of concern to trade unions and many public authorities – as recent EU initiatives aimed at improving the management of industrial change have shown. Collective bargaining initiatives to reduce or alleviate the negative impact of restructuring on the workforce have in some cases proved successful in the medium term.

The involvement of employees and collective bargaining in company restructuring, 2001
This comparative study examines the role played by employees and collective bargaining in managing and responding to the restructuring process.

Handling restructuring: collective agreements on employment and competitiveness, 2000
This report, based on 43 case studies carried out in 11 EU Member States, explores the key features of PECS (pacts for employment and competitiveness). It shows how these agreements can contribute to employment creation, a more flexible working environment and a partnership approach to industrial relations.

Telia case study (pdf file)
This study puts the spotlight on the Swedish state-controlled telecom company, Telia, which began an innovative three-year reorganisation project in 1995, considering alternative solutions to compulsory redundancies.

Corporate governance

Systems of corporate governance, i.e. the structures that influence and control management, have a key impact on the type of restructuring carried out by a company.

Corporate governance systems and the nature of industrial restructuring, 2002
This EIRO comparative study examines national systems of corporate governance. It looks at the influence of employees and shareholders on managerial restructuring decisions, and links this to developments in restructuring.

Towards a corporate social responsibility (CSR), 2003
This report, a synthesis of two reports commissioned by the Foundation on CSR, pinpoints the various factors and approaches influencing the implementation of CSR policies and the role and expectations of the main stakeholders in the process.

CSR in France, Germany, Hungary and the United Kingdom, 2002
These 12 case studies look at how European companies are developing models of best practice in the field of working and employment conditions and CSR. The companies selected are from four countries: France, Germany, Hungary and the United Kingdom.

'Reflective' restructuring

A more imaginative approach to the need for restructuring is emerging across Europe, with companies embarking on new schemes to offset their need for flexibility, coupled with employee demands for improved quality of life. These include access to training breaks, sabbaticals, job-sharing, remote working and reduced working hours, as well as promoting the take-up of maternity and parental leave.

Employment through flexibility – squaring the circle, 1998
Based on the Foundation’s Employee direct participation in organisational change workplace survey, this publication looks at the effects of direct participation on employment levels and how these relate to workplace flexibility issues such as downsizing, part-time work and employee consultation.

A new organisation of time over working life, 2003
Individuals are increasingly calling for a better quality of life, while employers require greater flexibility in the workplace, forcing a rethink of conventional work–life patterns. This report considers the 'life-course' concept of reorganising the use of time throughout life.

Reconciliation of work and family life and collective bargaining, 2002 (pdf file)
Looking at initiatives aimed at reconciling work and family life throughout the Member States, this report also examines how collective bargaining can be used to improve the situation in this regard.

Progressive retirement in Europe, 2001
This comparative study analyses the extent and uptake of progressive retirement schemes and their importance in the current debate between governments and social partners.

Non-permanent employment, quality of work and industrial relations, 2002
This comparative study looks at the possible effects of non-permanent employment on the quality of working life in terms of working conditions and the employees' labour market position and prospects.

Flexibility and working conditions, 2000
This report explores the impact of flexibility on working conditions and the resultant health and social effects on workers engaged in this kind of work.

Temporary agency work in the European Union, 2002
This report examines the main trends in temporary agency work and the problems and challenges arising from this phenomenon for the different Member States and the EU as a whole.