The Italian Industry at a Crossroad: Relative Deindustrialisation or Irreversible Decline

The article reports the main conclusions of the XXXIII Conference organized by "l'industria" together with the School of Industrial Economics of the University of Ferrara, concerning the future of the manufacturing industry in the midst of the most dramatic economic crisis since World War II. Manufacturing employment and Value Added are declining in all the industrialized countries, but at a different pace: very rapidly in the US and the UK, more slowly in Germany, Italy and Japan. The reduction is mainly due to the very high productivity growth rate of the manufacturing sector, and to the increase of outsourcing of industrial goods. The EU Commission considers these developments a "relative deindustrialisation", since they do not affect the role of industry and do not lead to an absolute decline of manufacturing. However, many worries are linked to the growing public debts of many countries, that is going to affect the growth rate of the economy and to the credit crunch that heavily damages the small and medium sized companies, cause of many bankruptcies. The paper outlines then the measures that can be quickly adopted by the Italian Government to support the small and medium companies, mainly affected by the credit crunch.