In this issue
• Support instruments in focus: innovative business transfer measures
• Case in focus: Major overhaul in Polish mining sector
• Case in focus: Planned Caterpillar closure at Gosselie

Eurofound

European Monitoring Centre on Change

European Restructuring Monitor

English

DigitalCommons@ILR

Cornell University ILR School 
DigitalCommons@ILR 
International Publications Key Workplace Documents 
10-2016 
ERM Quarterly, Quarter 3, October 2016 
Eurofound 
European Restructuring Monitor 
European Monitoring Centre on Change 
Follow this and additional works at: https://digitalcommons.ilr.cornell.edu/intl 
Thank you for downloading an article from DigitalCommons@ILR. 
Support this valuable resource today! 
This Article is brought to you for free and open access by the Key Workplace Documents at DigitalCommons@ILR. 
It has been accepted for inclusion in International Publications by an authorized administrator of 
DigitalCommons@ILR. For more information, please contact catherwood-dig@cornell.edu. 
If you have a disability and are having trouble accessing information on this website or need materials in an 
alternate format, contact web-accessibility@cornell.edu for assistance. 
ERM Quarterly, Quarter 3, October 2016 
Abstract 
In this issue 
• Support instruments in focus: innovative business transfer measures 
• Case in focus: Major overhaul in Polish mining sector 
• Case in focus: Planned Caterpillar closure at Gosselies 
Keywords 
Eurofound, business transfer measures, job creation, job loss, employment 
Comments 
Suggested Citation 
European Foundation for the Improvement of Living and Working Conditions, European Monitoring Centre 
on Change, & European Restructuring Monitor (2016). ERM Quarterly: Quarter 3. 
This article is available at DigitalCommons@ILR: https://digitalcommons.ilr.cornell.edu/intl/605 
ERM quarterly October 2016
in this issue
•	 Support	instruments	in	focus:	innovative	business	transfer	measures
•	 Case	in	focus:	Major	overhaul	in	Polish	mining	sector
•	 Case	in	focus:	Planned	Caterpillar	closure	at	Gosselies
Macroeconomic trends and prospects
The IMF, in its October World	economic	outlook, has revised forecasts for global growth downwards to 3.1% in 2016. 
Sub-par growth in the developed world economies risks perpetuating itself, according to the Fund. The authors of the 
report draw an important linkage between continuing low growth – and growing inequality –  and the political backlash 
against economic integration and globalisation: the Brexit vote is ‘only one example of this tendency’.  Potential trade 
barriers and geopolitical tensions – notably in all areas bordering the EU – contribute to increasing downside risks for the 
global and European economies. 
The closure announced by US equipment manufacturer Caterpillar of its Gosselies plant in Belgium was the most 
publicised restructuring announcement during the quarter (see ‘Case in focus’ on p. 4) and bears some similarities to the 
earlier Renault Vilvoorde case in 1998  – one of the original spurs to starting up the ERM database of restructuring cases.
Job creation and job loss at a glance
The ERM recorded a total of 327 cases of restructuring between 1 July and 30 September 2016. Of these, 130 were cases 
of announced restructuring involving job loss and 153 were cases involving announced job creation; 1 case involved both 
job loss and job creation. These cases comprised a total of 62,923 announced job losses and 51,536 announced job gains. 
In addition, the ERM recorded nine large transnational cases. Internal restructuring accounted for 79% of the announced 
job losses, an increase compared to the proportion of announced job losses last quarter (45%). Bankruptcy and closure 
events accounted for 13% of job losses this quarter. The proportion of announced job loss attributed to offshoring and 
relocation was 8%. In terms of geographical distribution and absolute numbers, Poland recorded the greatest number of 
announced job losses (13,796 jobs), followed by the UK (11,197) and France (8,944). The UK also recorded the greatest 
number of announced job gains (10,811), followed by Poland (8,475) and France (5,493). 
* Comparing the quarter to the four-quarter moving average; ++ = >100%; + = >50%; 
excludes country or sector if quarter average and 2016 Q3 <1,000 job losses or gains. 
Source: ERM,  July–October 2016
2016 Q2 Announced job losses Announced job gains
EU28 + Norway 62,923 51,536
EU28 + Norway, 
change on 
previous quarter
-21% -24%
Big increases by 
country* 
Poland++ Croatia++ 
Belgium+ France+ Spain+
Germany+
Big increases by 
sector*
Mining and quarrying++ 
Construction++  
Public administration++ 
Information and 
communication+
Professional, scientific and 
technical++  
Accommodation and food 
service+
79%
7%
7%
6%
1%
Reasons for announced job losses 
Internal restructuring Bankruptcy Oﬀshoring/delocalisation Closure Relocation
European Monitoring Centre on ChangeEMCC | 
Reasons	for	announced	job	losses
ERM quarterly October 2016Page 2
Sectoral distribution of job losses and gains
The figure below plots the top sectors (NACE rev.2 one-digit) in terms of announced job loss and job creation, as 
reported to the ERM in the third quarter of 2016. In absolute numbers, the largest announcements of job losses 
were recorded in the sectors of manufacturing (11,769), mining and quarrying (11,501) and financial services (9,869). 
Manufacturing also recorded the largest announcements of job gains (17,572), followed by transportation and storage 
(6,280) and retail (6,280). However, retail also appears in fifth place among the announced job losses (5,279). 
Announced	job	gains	
	
Manufacturing  17,572
Transportation and storage 6,280
Retail 6,280
Accomodation and food service  5,963
Professional, scientific and technical 4,250
Announced	job	losses
Retail -5,279
Information and communication -7,340
Financial services -9,869
Mining and quarrying  -11,501
Manufacturing -11,769
European Monitoring Centre on ChangeEMCC | 
Top 5 cases of job loss and job creation
Date Company   Job losses Location Sector Type of restructuring
02/08/2016       SFR   5,000 France Information/communication  Internal restructuring 
21/07/2016        PGG      4,897 Poland Mining and quarrying Internal restructuring  
28/07/2016        Lloyds Banking Group   3,000 UK Financial services Internal restructuring 
21/07/2016 Banco Popular   2,900 Spain Financial services Internal restructuring 
02/09/2016 Caterpillar   2,101 Belgium Manufacturing Offshoring/delocalisation 
 
The biggest case of job loss during the third quarter was that of French telecommunications company SFR. In August, 
it announced 5,000 job cuts over the coming three years. The reorganisation follows the acquisition of the company by 
Altice and a recent decline in its customer base. In the second-largest case, 4,897 job cuts were announced by Polish 
mining company Polska	Grupa	Górnicza (PGG – see p. 3). In the UK, Lloyds announced 3,000 job cuts, mainly at 
its branches, citing the increasing preference for online banking; the bank stressed that the decision to cut these jobs 
was taken before the referendum on EU membership. In the fourth-largest case, Banco	Popular in Spain announced a 
restructuring involving 2,900 losses – largely foreseen as voluntary redundancies and early retirement. In the fifth-largest 
case (p. 4), Caterpillar announced over 2,000 jobs cut with the closure of its Gosselies production plant in Belgium. 
 
Date Company Job gains Location Sector  
27/07/2016 McDonald’s 5,000 UK Accomodation/food service 
28/09/2016 Deloitte 2,200 France Professional services  
15/09/2016 IKEA 1,700 Spain Retail  
26/07/2016 Porsche 1,400 Germany Manufacturing  
28/08/2016 Deutsche Bahn 1,200 Germany Transport and storage  
 
The biggest case of job creation reported during the quarter was in the UK, where US fast-food chain McDonald’s 
announced the opening of 25 new outlets and the recruitment of 5,000 people on permanent contracts over the next 
year. Meanwhile, multinational services group Deloitte announced the creation of 2,200 new positions across France. 
About 30% of these will be for engineers, the expansion being linked to digitalisation and big data. The third-largest case 
of job gains were the 1,700 new positions announced by IKEA	Spain. Following an increase in consumer demand, the 
company is going to open new stores and increase its delivery strategy by promoting the use of its online catalogue. 
Car manufacturer Porsche is going to create 1,400 new positions to develop electric sports cars at its German plant 
based in Stuttgart-Zuffenhausen: 1,200 positions for the production line, and at least 100 IT-specialists and 50 experts 
for its digital unit. The fifth biggest job gain case is also based in Germany: Deutsche	Bahn is planning to hire 1,200 
train drivers. The vacancies will be filled through new entrants and apprentices.
-15,000 -10,000 -5,000 0 5,000 10,000 15,000 20,000
Manufacturing
Mining and quarrying
Financial services
Information and communication
Retail
Professional, scientiﬁc and technical
Accommodation and food service
Retail
Transportation and storage
Manufacturing
Announced job loss and job gain: Top ﬁve sectors, Q3 2016
ERM quarterly October 2016
Page 3
support instruments in focus 
Innovative	forms	of	business	transfer
Business transfer and succession, the handover of ownership 
and management from one entrepreneur to another, is a 
recurring topic on the policy agenda at EU and Member 
State level: a successful business transfer has the potential 
to safeguard jobs. Nonetheless, this form of internal 
restructuring has proven to present many challenges in 
practice.
The European Commission, recognising the importance 
of the topic, issued Directive 2001/23, which aims at 
protecting the acquired rights of affected employees. At the 
same time, expert groups have discussed how to support	
entrepreneurs	in	successfully	enacting	business	
transfers. At national level, Member States have devised 
different ways of facilitating business transfers: some 
measures entail some kind of financial support while others 
focus on providing information and advice to companies.
In terms of information and advice, in a number of 
Member States the succession bourse option is available to 
companies interested in a business transfer – in Austria, 
Belgium, Luxembourg, France, Germany, and the	
Netherlands. The succession bourse is a tool aimed at 
listing buyers and sellers (almost always anonymously) and 
facilitating a match. In many cases, they are run by a chamber 
of commerce with the support of national funds. In Austria, 
Luxembourg and Germany, the listing is free of charge. In 
Belgium and the Netherlands, the listings are accessible only 
to members of the chambers of commerce. In Luxembourg, 
the Netherlands and Germany, there is a matching service: 
the bourse helps companies find a possible buyer (or seller) 
and facilitates the process with meetings, documentation 
support and advice.
There are also some regional bourses in which different 
chambers of commerce collaborate. For example, 
Transenterprise	in	France covers 16 regions. Potential 
buyers can consult the regional bourse database for free, 
while sellers must pay a fee of €150 to publish an offer 
(which includes support for drafting it). Professional advice 
and guidance are provided: companies have access to a 
network of 600 technical advisers and 2,700 notaries, 
chartered accountants and real estate agents. Workshops 
and network activities such as meetings and exhibitions are 
also organised. In the Wallonie region in Belgium, an annual 
flat fee is charged to buyers for the use of the platform. 
An additional success fee for direct buyers also applies if 
matching was achieved through the database. 
Austrian law provides for financial support in the form 
of exemption from stamp duty and fees for national 
administrative documents and for formal procedures related 
to a transfer. Property taxes are applicable only over a value 
of €7,500.  Another form of financial support to companies 
undertaking a business transfer is a contribution towards 
employees’ salary: in the Czech	Republic, national funds 
can be used to cover up to 50% of the minimum wage 
for a maximum of six months. This applies in cases where 
an employer taking over an existing business is not in a 
position to guarantee the contracted number of hours to its 
workers.
For further information, please visit Eurofound’s ERM 
database	of	restructuring	support	instruments.
case in focus 
Restructuring	in	Polish	coal-mining	sector
Nearly 13,000 jobs have been lost in the Polish mining 
sector since the beginning of 2016, arising from large-scale 
restructurings recorded by the ERM. The sector is suffering 
the effects of the slowdown in demand of coal worldwide, 
despite a commitment by the newly elected Polish 
government to continue using coal as a source of energy. 
Two key bodies are involved in the sector’s restructuring: 
Mines Restructuring Company (SKR) and Polska	Grupa	
Górnicza (PGG).
The restructuring of the Polish coal business is assigned 
to SKR, a company fully owned by the State Treasury. Its 
mandate is to manage the process of closing down mining 
companies, including the assets of liquidated mines. One of 
the biggest cases involving the transfer of mines concerns 
Jastrzębska	Spółka	Węglowa. The company will cut 
2,900 positions by the end of 2017 as part of a long-term 
restructuring plan (from 2016 to 2025)  in which some 
subsidiaries (the Ruch Jas-Mos and Krupiński coal mines) 
will be transferred to SKR, and others (Spółka Energatyczna 
Jastrzębie and Wałbrzyskie Zakłady Koksownicze Victoria) 
will be sold.
PGG is a limited liability company created in April 2016 in 
an agreement facilitated by the Polish government involving 
energy business companies, banks and social partners. Its 
business plan envisages stricter controls of coal production 
and a commitment to manage mining companies in difficulty 
for the next two years. The government is planning to 
reorganize and regulate the sector, in order to return it 
to profitability. PGG acquired 11 coal mines with 32,500 
employees from Kompania Węglowa, one of the biggest 
mining companies in Europe. PGG initiated a voluntary 
dismissals programme in July affecting nearly 5,000 workers 
and announced a further 660 job losses in administration 
and management positions in September 2016.
Poland	relies	on	coal	for	90%	of	its	electricity	
generation and the ruling Law and Justice party has 
signalled that it will support the coal industry, if necessary 
at the expense of the renewable energy sector. The 
restructuring involves significant financial support to the 
industry and will be subject to EU scrutiny for compliance	
with	rules	on	state	aid.
European Monitoring Centre on ChangeEMCC | 
ERM quarterly October 2016
Page 4
About the ERM 
The European Restructuring Monitor (ERM) is a unique EU-wide dataset on larger-scale restructuring events. It monitors 
the announced employment effects of restructuring in the EU28 and Norway.  The ERM is updated on a daily basis 
and data can be used for statistical analysis. It relies on reports in selected media titles. The data for this report were 
extracted on 10 October 2016. For more, visit the European	Restructuring	Monitor	web	page.
   This issue is based on contributions from Eleonora Peruffo, Wendy Jacobs, John Hurley and Andrea Broughton (EU-level correspondent).       EF/16/51
European Monitoring Centre on ChangeEMCC | 
case in focus 
Caterpillar	announces	closure	of	Belgian	
plant	in	Gosselies
The crisis in the mining and quarrying sector has had a 
knock-on effect on associated manufacturing. In September 
2016, the US construction and mining machinery 
manufacturer Caterpillar announced the closure of its 
facility in Gosselies, Belgium, involving the loss of over 2,000 
jobs. Production at the site will be moved to Grenoble 
in France and to other production sites outside Europe. 
The company says it decided to close the Gosselies facility 
because of the large size of the site and its high production 
costs; the company has also been battling with a decline 
in demand for its products. The closure is part of a global 
restructuring plan announced in September 2015, which is 
expected to entail the loss of between 5,000–10,000 jobs 
in total. More than 1,300 employees were already made 
redundant from the Gosselies site in 2013 (it is estimated 
that the company has reduced its workforce by over 30,000 
since the middle of 2012). 
This latest announcement has provoked a strong 
reaction locally and from trade unions; commentators 
are likening this to the protests against the closure of 
Renault’s Vilvoorde site in Belgium in the late 1990s. The 
announcement date, 2 September, has already been dubbed 
‘Black Friday’ by locals; it is reported that some workers 
seized bulldozers and attempted to block the entrance to 
the Gosselies plant. Gosselies is situated in one of the most 
economically deprived regions of Belgium, an area that 
was part of its former manufacturing heartland but which 
has been in industrial and economic decline for decades. 
The Caterpillar plant is therefore an important source of 
employment in the area. 
The European trade union IndustriAll has stated that the 
Caterpillar plant is profitable and should not be closed.  
Matthias Hartwich, IndustriALL director for mechanical 
engineering and materials industries, stated: ‘This	is	part	of	
the	ongoing	deindustrialisation	of	Belgium, and shows 
that Caterpillar cares only about return on investment, 
and not the sacrifices made by its loyal workforce. This is 
a profitable plant that will shut because the company has 
found a way to cut costs further. Throughout this process, 
there has been no proper consultation with the works 
council. This is why it is necessary to install genuine social 
dialogue’. 
However, in a press release on 2 September, Caterpillar 
stated that it had to respond to lower demand for its 
products. Tom Pellette, Caterpillar group president with 
responsibility for construction industries, stated: ‘We have 
to contemplate actions to reduce manufacturing capacity 
and take	operating	costs	out	of	our	business	to	
align	with	lower	demand. Should the intention be 
confirmed, we will support the local leadership in order 
to mitigate the impact on our employees, their families 
and the communities where we’re located’. The company 
emphasised that it is committed to complying with the 
applicable laws and to engaging in a constructive dialogue 
with employee representatives in order to minimise the 
social impact of this decision.
There has been a strong political reaction to the Caterpillar 
decision both in Belgium and at European level. Belgian 
opposition parties have accused the right-leaning coalition 
government of not doing enough to support employment 
and manufacturing in the country. A task force has been 
established with the participation of the European 
Commission and Belgian national and regional authorities. 
Its role will be to monitor the information and consultation 
processes during the Gosselies restructuring, identify 
possibilities of EU funding for the affected workers (such 
as the European Globalisation Adjustment Fund) as well as 
possible reconversion options for the site.  
The company will now begin the formal information and 
consultation process on the closure. 


ERM Quarterly, Quarter 3, October 2016

In this issue • Support instruments in focus: innovative business transfer measures • Case in focus: Major overhaul in Polish mining sector • Case in focus: Planned Caterpillar closure at GosseliesEF_ERM_Quarterly_1016.pdf: 13 downloads, before Oct. 1, 2020

eCommons@Cornell

https://digitalcommons.ilr.cornell.edu/cgi/viewcontent.cgi?article=1613&amp;context=intl

ERM Quarterly, Quarter 3, October 2016

Abstract

Similar works

Full text

Available Versions

DigitalCommons@ILR

eCommons@Cornell