During a Monthly Forum held on 1 February, ETUI senior researcher Béla Galgóczi presented the main findings of a recent paper on the economic and industrial restructuring process of the Ruhr areas.
‘We are facing a long-term challenge: Europe needs to reach carbon neutrality by 2050, according to COP21. This means that Europe needs to double the effort it made between 1990 and 2020 in order to exit from fossil fuel in 2050’, said Béla Galgóczi, presenting a recent paper published in the Journal of Labour Research on The long and winding road from black to green. Decades of structural change in the Ruhr region.
The Ruhr region underwent a transformation lasting more than 50 years and from that experience some lessons can be learned. Between 1960 and 2014 employment in coal mining fell from 390,000 to just 11,000. By 2014 this industry accounted for 21% of the regional economy, compared to 33% in 2000 and 61% in 1960. The phase-out of coal will be complete by 2018.
Some of the leaders in the green economy of today – with expertise in, for example, soil protection, re-cultivation of land and renewable energy – trace back their origins to the coal mining industry of yesterday. ‘Due to the strict environmental rules and the high demand for clean technologies among local firms, the Ruhr was able to build up considerable expertise in how to counter environmental damage’, Béla Galgóczi continued. The Ruhr developed a comparative advantage in energy supplies and waste disposal by setting higher standards for its industries.
The study shows that, in terms of industrial policy, top-down initiatives did not necessarily work. However, once the main actors of the economy, stakeholders, social partners and municipalities started to work together, the locked-in situation ended and the transformation gained momentum.
Employment in mining in the Ruhr area underwent a radical downsizing over half a century (from 473,000 in 1957 to 11,448 by the end of 2013): this is something that can be achieved only if social partners are involved in the process.
Peter Scherrer, Deputy General Secretary ETUC commented, ‘The success of the transformation of the Ruhr region was possible also because trade unions were very well organised, with union density in the area being among the highest in Germany. Being able to influence where the investments are going, and how public money is spent, is key to the just transition that took place in the area’.
In 1993 the bargaining parties signed an agreement guaranteeing a socially responsible approach to the manpower restructuring programme. The workforce agreed to forgo a wage increase and, in order to avoid compulsory redundancies, a work redistribution programme was devised and put in place. In spite of the overall success of the restructuring process and the socially responsible way it was managed, it had a social cost: the unemployment rate of the Ruhr region is still almost the double of the German average.
Other regions in Europe could learn from this experience and make sure that, whenever such a transformation takes place, there is cooperation between parties, the state plays an active role, and social partners are fully involved in the process.
Béla Galgóczi (ETUI)
Éloi Laurent (OFCE) and Philippe Pochet (ETUI)
Mike Scott, freelance journalist