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European Edition
14th January 2025
 
THE HOT STORY
Dutch government cracks down on illegal workers
The Dutch government is considering custodial sentences for job agencies and employers who hire illegal workers from outside the EU, as the number of such workers continues to rise. Chief labour inspector Marijke Kaptein observed: “What we are seeing is that there are not enough European workers to go around.” Currently, between 600,000 and 800,000 foreign workers are employed in low-skilled jobs in the Netherlands, a number that grows by between 40,000 to 50,000 annually. Exploitation of these workers is prevalent, with inadequate housing and threats of dismissal for illness. Social affairs minister Eddy van Hijum agrees that the issue needs addressing. “I think that we in the Netherlands have become too dependent on cheap labour. Far too many sectors have become addicted to labour migration as a solution to their problem . . . We will no longer accept that cheap labour and abuses are the image of the future.”
STRATEGY
Gazprom braces for layoffs
Russian gas giant Gazprom is weighing cutting about 40% of its headquarters staff, or more than 1,500 jobs, as the company contends with the loss of most of its European sales. Gazprom employs 498,000 people. When contacted by Reuters, a company spokesperson confirmed the report by state news agency TASS, which cited a media outlet called 47news.
WORKFORCE
Positive reactions to Malta's new migration policy
The Maltese government's new labour migration policy has received generally positive feedback from various stakeholders. Prime Minister Robert Abela stated that the policy aims to regulate the entry of workers from outside the European Union into the Maltese labour market. Home Affairs Minister Byron Camilleri introduced 32 recommendations for public consultation, which will remain open until 9 February. Josef Vella, CEO of UHM, expressed concerns about high turnover rates and the lack of housing provisions for third-country nationals, stating: "There is a social impact, and accommodation is one of them." Joseph Farrugia from the Malta Employers' Association acknowledged the necessity of the policy but emphasised the importance of utilising local resources before importing labour. The General Workers' Union commended the initiative, highlighting the need for measures to prevent labour market abuse and ensure fair working conditions.
Anxiety grips Germany's working class
In Düren, a city in Germany's North Rhine-Westphalia, the upcoming snap election on February 23 is intensifying anxiety among the working class. Helge Peter Herrwegen, a local IGBCE union official, remarked: “There's a lot of uncertainty,” reflecting the concerns of blue-collar workers facing job insecurity amid Germany's transition away from fossil fuels. The far-right Alternative for Germany (AfD) is capitalising on these fears, gaining traction in areas like Düren, where traditional parties are losing support. As major employers like Thyssenkrupp AG and Ford Motor Co. cut jobs, the AfD's message resonates with those feeling abandoned by mainstream politics. Jens Südekum, a professor at Heinrich Heine University, noted: “The AfD is capitalising on anxiety in regions where industries struggle to adapt.” With economic recovery seeming distant, local leaders are grappling with the erosion of trust in political promises.
Unemployment dips as Türkiye tightens policies
Türkiye's unemployment rate decreased to 8.6% in November, down from 8.7% in October, according to the Turkish Statistical Institute (TurkStat). The number of unemployed individuals fell by 84,000 to 3.07m, with male unemployment at 7% and female unemployment at 11.7%. Despite aggressive interest rate hikes aimed at controlling inflation, officials are committed to mitigating any adverse effects on the labour market. The central bank recently initiated a rate-cutting cycle, reducing the benchmark policy rate to 47.5% as inflation trends downward. The labour force participation rate also declined to 54.2%, with a notable drop in the number of employed persons, which fell by 168,000 to nearly 32.75m. Youth unemployment decreased to 15.8%, with rates of 11.9% for males and 23% for females. The government raised the minimum wage for 2025 by 30% to TL 22,104, reflecting its commitment to disinflation targets.
CORPORATE
Ten offers for Taranto steelworks
Ten offers have been submitted by both domestic and international players to acquire Acciaierie d'Italia (ADI), previously known as ILVA, in Taranto. The extraordinary commissioners overseeing the steel operator in administration confirmed this on Saturday. Notably, three bids were for the entire industrial complex, with contenders including Baku Steel Company Cjsc, Azerbaijan Investment Company Ojsc, and Jindal Steel International. The remaining seven offers focused on individual assets, with interest from groups such as Marcegaglia, Eusider, and Sideralba. ADI's main facility in Taranto is one of Europe's largest and a significant employer in the region.
TECHNOLOGY
Starmer plans to make Britain an AI 'superpower'
Prime Minister Sir Keir Starmer has unveiled plans for the development of the UK's artificial intelligence industry. A raft of proposals include new AI "growth zones," where the construction of key infrastructure such as data centres will be prioritised, and the development of a new supercomputer to boost the UK's computing power. The government says the technology could increase productivity by 1.5% a year, worth an extra £47bn annually, over a decade. "Britain will be one of the great AI superpowers," Starmer said on Monday at University College London, noting that the country was already the European leader for AI investment. "We're going to make the breakthroughs, we're going to create the wealth, and we're going to make AI work for everyone in our country."
RISK
In-house counsel worry about growing cyber and AI disputes risk
Baker McKenzie’s annual disputes survey has found that in-house lawyers at multinational companies identified cybersecurity and data privacy as their top disputes risks heading into 2025. The firm's Global Disputes Forecast 2025 survey showed that 45% of respondents said cybersecurity and data privacy was their greatest disputes risk, followed by artificial intelligence (44%) and employment (32%). Commercial and contracts, and also tax, was highlighted as a risk by 25% of survey respondents. Vinod Bange, a partner at Baker McKenzie in London, said: “We are at an inflection point where cyber risk is concerned. With technological advancement – such as AI and other drivers for digital transformation – as well as the increased global geopolitical threat, it’s not hard to see why we are witnessing a rapid increase in cyber-attacks right across the eco-system.”
OTHER
Rental prices in Zurich hit new heights
In Zurich, landlords are exploiting the city's housing shortage by offering 'alternate' accommodations at exorbitant prices, with some tiny studios listed for as much as 2,602 francs per month. One landlord claims their 14-square-metre studio “offers clever solutions to maximise space,” despite the cramped conditions. Larger flats are also being advertised at steep prices, such as 4,350 francs for 22 square metres. This trend is driven by the lucrative market for corporate flats, which are often rented by employers for their employees. However, this practice exacerbates Zurich's chronic housing shortage, as many landlords convert regular residential flats into these high-priced business apartments, making affordable housing increasingly scarce.
 


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