EU single market strategy must not be at the expense of employees and consumers

In a recent dossier published by Social Europe, a group of industrial policy and innovation scholars analyse the current challenges facing EU industrial policy. They highlight the conceptual and practical shortcomings of the current approach to industrial policy and set out their vision for an EU industrial policy that is based on social inclusion and effective governance. To mark the publication of the dossier, AK EUROPA, in cooperation with the Austrian Foundation for Development Research (ÖFSE), organised a large public event in Brussels on 15 September 2025.

On 10 September 2025, European Commission President Ursula von der Leyen delivered the annual State of the European Union speech, whereby she focused on the topics of security, defence and competitiveness. Both, the war in Ukraine and the humanitarian situation in Gaza were given extensive attention. Social policy issues such as the inflation crisis, the quality of jobs and strategies for combating poverty were mentioned, but relatively brief and without providing much detail.

With the Omnibus IV package, which was presented on 21 May 2025, the Commission aims to introduce a definition regarding small mid-cap companies. This is justified by the need to reduce the administrative burden on businesses. However, in concrete terms the proposals would, among others, result in massive erosion of data protection. Over the summer, the Commission conducted a consultation on the Omnibus IV Package, in which AK also participated.

15 percent tariffs on EU industrial products in the US, while at the same time free of tariffs for US products in the EU, create a significant imbalance in the future trade relations between the EU and the US. The EU's billion-dollar investment commitments in the US further exacerbate this imbalance. The tariff gap between steel and aluminium is particularly drastic. In addition, the deal once again puts pressure on key EU initiatives such as the Corporate Sustainability Due Diligence Directive.

The Commission plans to present a European Affordable Housing Plan in 2026. This will complement the housing policies of Member States, including regional and local authorities. One of the most important initiatives planned is the revision of state aid rules. To this end, the Commission launched a public consultation, which ended on 31 July 2025.

In view of the EU's massive investment needs, the question of how to finance them is becoming increasingly pressing. In doing so, the focus is on deepening the capital markets and, first of all, relaunching the securitisation framework. However, it is doubtful whether this will actually lead to more private investment in the green and digital transitions and increase the EU’s competitiveness. At the same time, financial stability could be undermined again.

Even before implementing this directive in the Member States, EU institutions have currently been working on ultimately reversing key elements of the EU Corporate Sustainability Due Diligence Directive as part of the Sustainability Omnibus or Omnibus I. The potential impact of Omnibus I was discussed this week at a joint event organised by AK EUROPA, the ÖGB European Office, ETUC, ECCJ and FoEE.

On 2 June 2025, the European Trade Union Institute (ETUI) presented this year's edition of the Benchmarking Working Europe report at a joint event with AK EUROPA in Brussels. In light of the ongoing political discourse, the 2025 report highlights the importance of quality jobs for sustainable competitiveness. The critical examination of the concept of competitiveness was also a central theme of the event.

The EU has been engaged in a global race for competitiveness for some time now. The European Commission's new Single Market Strategy is meant to help it stay ahead of the pack. The aim is to remove all obstacles that businesses perceive as hindering trade of their goods and services in other Member States. However, this risks dismantling social and environmental standards.