Technology-related strategies in labour-intensive industries from Southern European Regions: consequences for local employment

Tese dout., Economia, Universidade do Algarve, 2010

The present research aims to better understand the entrepreneurial behaviours of small firms within a globalising Europe. A special attention is due to the links between economic agents and their surrounding environments, admitting a two-way flow of influences between both: environmental conditions influence the performance of small firms as much as their behaviour promotes long term impacts on local settings. Empirically, the analysis is based on a questionnaire application to a sample of 167 small and medium sized firms from textile, clothing and leather (TCL) sectors, and belonging to the following European Southern areas: North (Portugal), Valencia (Spain), Macedonia (Greece) and South Italy (Italy). The selection of these regions was made considering their economic vulnerability, based on three major criteria: EU objective 1 status, being outside large urban centres and with an economic tissue based on labour-intensive firms. A common questionnaire was applied in each region, allowing a cross-country analysis among regions whose economic dependence to labour intensive sectors, particularly vulnerable to the low-wage competition arriving from Asian competitors, is a common threat. The tendency has been the employment decline in these industries with the increasing relocation of manufacturing jobs in low-cost areas. Only successful firms, the ones with higher technological capabilities, are able to develop the proper investments in innovation and technology and create employment. In these cases, people employed are more flexible and higher skilled, hence able to work in the several complementary areas of the textiles and fashion value-chain, such as design, marketing, management or sales.