#reindustrialisation

Europe’s industrial revival is transforming how and where Europeans work, from smart factories and renewable energy sites to advanced manufacturing lines. But experts warn that without stronger enforcement and updated safety frameworks, the EU’s competitiveness could come at the cost of its workforce. “Occupational safety and health remains a baseline without which there can be no true positive…

Founded in 2011 by Guy Serrure, Volma specialises in entrance door openings, entirely designed and manufactured in its factory in Harnes, in Hauts-de-France[1]. Taken over by Franck Serrure in 2017, made in France and CSR (Corporate Social Responsibility) remain more than ever at the heart of its project, signifying the quality of its products. The company is also a member of La French Fab, “the banner of French industry in motion”.

A major player in France in the market for single-piece sashes, door panels and decorative glazing, Volma[2] has made the choice to design, shape and manufacture entirely in France. "If at the beginning, for lack of means, we imported certain products, such as PVC panels, very quickly with success, my father, who is an entrepreneur at heart, had the willingness to integrate production, in particular to meet to specific requests. It has always been in our DNA, it happened naturally, especially since the quality of the products imported at the start did not correspond to the market demand", explains Franck Serrure, who took over the reins of the company in 2017. “Today, everything we manufacture and sell is transformed here, PVC, aluminium, glazing... We only buy raw materials and always within European borders. These actions and values meet the criteria of La French Fab, [3] a community with which we have been proud to be associated for many years. »

Between the products in the catalogue and the specific requests of its customers - manufacturers and producers of carpentry - Volma has developed tens of thousands of references, with a multitude of variants and options. “We make 70 personalised quotes per week, in addition to what is referenced in the catalogue. We have no stocks, we only process on demand, within standard deadlines, with all the technological and home automation constraints. »

At the same time, Volma is working to reduce its carbon footprint on various items. It has installed a differentiated LED lighting system, in order to reduce its energy consumption by 10%, and invests heavily in recycling and recovery of its waste, glass, PVC, aluminum, wood scraps. In addition, it has been digitizing all of its supplier and customer invoices since 18 months. "We are very close to zero paper", indicates the manager.

A former soccer professional, who has practiced all trades at Volma according to good old school principles (order picker, machine operator, production management, then key accounts), Franck Serrure is particularly concerned about his "collective", the well-being of his 150 employees. In addition to regular salary increases and exceptional bonuses granted to them several times a year, Volma invests in innovative tools to improve their working conditions, while optimizing their productivity. The company has just invested in an autonomous robot for heavy handling tasks. “We are currently finalising 4 million euros of investment in the production tool, which is increasingly innovative and technological, largely intended for the Zéro Porté project[4]. The idea is that our employees no longer have to carry heavy materials, knowing that what we produce today weighs three times as much as it did twenty years ago, with everything we "embark" on the opening, noise insolation, thermal, home automation, increasingly heavy glazing… All while gaining in flow and responsiveness. »

Half of the envelope, i.e. 2 million euros, is covered by the European regional development fund ERDF "Today, in the dynamic of reindustrialisation of France, French entrepreneurs receive a lot of  very, in particular by Bpifrance which supported us when we went through serious financial difficulties in 2017, then during the Covid pandemic, thanks to a loan of 850,000 euros”, concludes Franck Serrure.

Source

Bpi France, Made in France et économie circulaire, les clés du succès de VOLMA, in : Les Echos, 7-7-2023, https://www.lesechos.fr/partenaires/bpifrance/made-in-france-et-economie-circulaire-les-cles-du-succes-de-volma-1960212

[1] Hauts-de-France is the northernmost region of France. Its prefecture is Lille. With 6,009,976 inhabitants as of 1 January 2015 and a population density of 189 inhabitants per km2, it is the third most populous region in France and the second-most densely populated in metropolitan France after its southern neighbour Île-de-France. It is bordered by Belgium to the north.

[2] https://www.volma.com/wp-content/uploads/2023/01/PANNEAUX-ALUMINIUM.pdf

[3] “La French Fab “ embodies the companies of the industrial sites located in France which recognize themselves in the desire to develop French industry, adhere to the concept and values of La French Fab and want to wear its colours. It federates the ecosystems of the industry carried by all the actors of the territories who approach La French Fab as a unifying sign. Alongside the State, Regions of France, the Alliance for the Industry of the Future, Business France and Bpifrance are founding members of La French Fab. La French Fab embodies the future of French industry… an innovative industry, exporting and open to developments brought by digital, new technologies and the green economy. https://www.lafrenchfab.fr/2018/06/27/quest-ce-que-la-french-fab/

Since the beginning of the Covid-19 pandemic, calls to relocate and reindustrialise France have multiplied. Faced with the closure of borders, the brutal and drastic reduction in world trade and international exchanges, shortages of raw materials or imported products, the weakness and decline of the industrial sector in France are increasingly being pointed out. The feeling of fatalism in the…

Picture: Brussels, Villa Empain

Reshoring as the solution to production breakdowns ?

When the dust from the corona crisis has settled, many companies will wonder whether it is a good idea to get so many parts and goods from China and Asia. A long hitch in China causes work stoppages or empty shelves 7,600 km away in Europe. We can't even make anything as crucial and simple as a mouth mask here.

And there is not only the corona virus. The outbreak comes at a time when Europe, with Germany leading the way, has not yet recovered from the effects of the China-US trade war. In addition, China's Huawei and its dominance in 5G technology reveal that Europe has become highly dependent on foreign technology and products. The question therefore arises whether Europe should not produce much more itself again.

The idea that Europe needs to produce more itself again is not new and even has a name: "reshoring", the mirror image of offshoring. Offshoring is the movement that characterized Europe and the US in the 1990s and early 2000s, when the manufacturing industry drifted en masse to low-wage countries, in particular to China. Low labor costs and cheap container connections were the main motive for no longer making all kinds of products, from mouth masks to computers.

Shortly after the financial crisis, the tide started to turn cautiously and one could see here and there companies doing the other way around: bringing back production from China to the West. In the US in particular, wages had fallen due to the crisis, reducing the wage differential with China. In addition, due to the success of shale gas, the US experienced low energy prices, which turned the costs for a number of companies again westward. Companies that produced in China often found problems with the quality of the products, the long delivery time or the problem that a Chinese business partner simply copied the product under a different name.

Reshoring also entered Europe a few years ago. For example, in 2012 Philips removed part of the production of shavers from China and transferred it to its location in Drachten, Friesland. There are also examples in Belgium, such as ED&A from Kalmthout, that brought the production of electronic printed circuit boards back to the Kempen in North-Belgium in 2012 to be closer to the customer and to keep the quality better under control. ED&A’s CEO Gert D'Handschotter says he is still very satisfied with that decision. "I notice a lot of admiration from colleagues and customers for the step we have taken. In this crisis, we now also have the advantage that we can give a perfect update of the production to the customers, so that they are not dependent on a factory somewhere in Turkey or China. But no matter how beautiful your story is, you should be able to offer competitive rates in the first place. "

In the Flemish (North-Belgium) industry, there are also examples of companies that consciously keep and strengthen parts of the production here, such as beamer-producer Barco and loom manufacturer Van de Wiele. Proximity to the R&D department, quality control or protection of intellectual property are often the motivations. Most importantly, robotization and other automation processes once again make it possible to produce profitably here.

Last year the reshoring story got a setback, when the leading project in Europe closed its doors. A few years earlier, sports clothing manufacturer Adidas had opened a shoe factory in Bavaria with big drums’ sound that would again manufacture running shoes in Europe via 3D printing and robots. But the factory never reached the desired results, causing production to disappear back to Asia.

Sustainability

Coincidence or not, but just before the new coronavirus broke out all over the world, Bank of America’s exchange house came up with a large study that explored the theme of reshoring. The survey involved 3,000 of the largest publicly traded companies in the world. That survey found that as many as 80% of companies have plans to relocate their production sites and supply lines. In the US, 50% of companies are said to have plans to rebuild production to America. The trade war in which companies try to escape tariffs, in addition to safety and sustainability, is mentioned as motive. The latter concerns both the ecological footprint of long supply lines and the avoidance of involvement in countries with poor labor practices and thereby suffering reputational damage. According to Bank of America, an essential component in that reshoring is increasingly better and cheaper robots that make production in the West affordable again.

For Robert Boute, professor of Supply Chain Management at Vlerick and KU Leuven (Belgium), the corona crisis can be a turning point and, as Bank of America indicates, logistics chains will be redesigned. "Companies are now being awakened to see how vulnerable their supply chain is. You can get some sort of multiplier effect that brings together the corona crisis, the trade war and the excessive technology dependence on Asia and the US. This will lead to companies wanting to become less dependent on a limited number of suppliers. "He warns that closer production is not the saviour of humanity. "Many companies will now find that they may work with suppliers in Europe, but also that a few steps further in the production process there still are parts from China, which will cause them problems."

Boute believes most in the model of "double sourcing", in which companies get their basic demand for parts from cheaper Asia, while looking for suppliers closer to being able to react quickly. But he does not believe that we will now be mass-producing in Europe once again. "China is also automating on a large scale, helping to maintain a significant lead in certain technologies. And I don't see labor-intensive products returning. "

Patrick Van den Bossche, expert at Belgian technology companies’ federation Agoria, also believes that the corona crisis can lead to a wake-up call. "Companies will wonder if the just-in-time model, which keeps stocks as limited as possible, is still the right model." But he emphasises on the difficulty of replacing China or Asia as a supplier. "Some value chains, especially in electronics, have completely disappeared from Europe. You cannot just switch suppliers. For example, if your supplier produces chemical products, he must meet many standards and have certificates. Many companies, especially SMEs, are forced to purchase in China because they do not find any here. They don't do that for their pleasure. "

Value chains in Europe

Even before the coronavirus came along, the European Commission was aware of the risk that Europe would become too dependent on supply chains outside Europe, especially for the industries of the future. She published a report in June 2019 entitled 'A vision for European  industry until 2030'.[1] In it, she selected six value chains that she felt the EU should play an important role in. These were the green and self-driving car, hydrogen technology, smart health technology, the Internet of Things, cyber security and low-CO2 industry.

The battery industry, which is crucial for the transition to electric cars, is perhaps the most striking example of Europe hoping to establish that value chain on European soil. "Certain parts of that chain are already in Europe, but links are still missing," says Patrick Van den Bossche from Agoria. He does believe that targeted policies should be able to reduce dependence on Asia. For example, there are already some initiatives to set up battery factories in Europe.

Jan Van Hove, besides chief economist at KBC Bank (Belgium) also professor of International Economics at KU Leuven (Belgium), is anxious. He fears that the discussion about dependence on Asia will open the door to all kinds of state aid or market shielding. "The French will be at the forefront of protecting sectors that are already highly protected through even more subsidies or monopolies. Just think of the discussion about blocking the merger between Alstom and the Siemens train division. "

According to Van Hove, who is an advocate of globalization, you can also solve the economic risks exposed by the coronavirus in a simpler way. "You can also hold larger stocks and possibly impose obligations on the size of that stock for certain critical products. You already have that for oil, where countries have to keep strategic stocks. You could expand that kind of strategic stock to other products, instead of being forced to bring back all kinds of production chains. "

Van Hove also notes that globalization has clearly been declining for several years now and that we are evaluating to economic blocks of countries such as Europe and North America. According to Van Hove, things have gone unnoticed here, but the main driver behind this de-globalization is China itself. "China clearly wants to become less dependent on the rest of the world. The credit crisis in 2008 opened their eyes. They were suddenly faced with a serious economic slowdown caused by the US housing market, which they had little to do with. China therefore has the priority to make as much as possible itself and not to be dependent on foreign production chains. That is much more important to them than that they dominate the whole world with their products. "

Author: Stijn Decock - de Standaard - Saturday, March 7, 2020 - our translation to English

Picture: training of trainers for RAF 1,vocational training organised by banking sector, Kigali, May 2019

In a previous article, I argued for courageous and necessary steps to re-industrialize Europe, on the grounds that a continent dedicated solely to services does not offer sufficient opportunities to help all sections of society at work and, moreover, to promote most forms of innovation. Incidentally, it is also known that the steps that are currently being taken to further improve deep learning in artificial intelligence are aimed precisely at ensuring a level of service provided by robots that people can no longer cope with, which will make them useless.

The re-industrialization that has now begun in the US. and several European countries, however, is one based on digitization and innovation. It is only in this way that companies are again prepared to invest in Europe and to remove their production from the Far East. However, this digitization and innovation requires a completely different educational curriculum than we are used to in Europe. It does not mean that education by the transfer of knowledge must be wiped off, that the old school education of thinkers and values ​​must be dug up. But it does require a combination of knowledge and skills in compulsory education and a lifelong acing for continuous education. It is important to understand the social, economic, historical and cultural heritage of the context in which people live and work. It also requires education for all levels and ages in practical environments and the integration of the people’s living contexts  in a technological and digital environment.

Re-industrialization focuses on the manufacturing industry. This is still the backbone of the economy and investing in it offers a multiplication in economic growth. A general increase in the productivity of the manufacturing sector makes a contribution to the growth of GDP that is four times higher than that of other inputs. However, industrialization requires new competencies that are supported by technology and also requires new organizational models. On the one hand, the new competences must be embedded in compulsory education, but on the other hand, they must also be transferred to those that are already at work. This is the role of both adult education and the business community itself.

Within the educational process, innovation must focus on content and methods, on the steering methods necessary to achieve innovation, on human resources and skills and on the required materials and on institutional settings. Even though reform initiatives in education are crucial, more feasible, faster and more incisive changes are be quickly realized by involving local actors in action research practices.[1]

Permanent learning as a guarantee for lasting production improvement

It is assumed that the number of existing companies, investment in research and development, the quality of science and education, the availability of financing and government policy have a major influence on the number of entrepreneurs in a country.[2]

We do not want to address in the first place the steps that compulsory education is taking to prepare the future generation for this renewed interest in industry. The introduction of S.T.E.M. (skills in science, technology, engineering and mathematics) in compulsory education is starting up. In some countries with a less classical tradition, slightly faster than in countries that drag on a Greek-Latin philosophical past.  Moreover, the German-speaking countries have a long lasting tradition and an appreciation of technical schools and colleges as well as of dual learning. In this last case pupils & students with a more practical attitude quickly receive a combined training package in close cooperation between the company providing the work placement and the educational institution that generally provides education and supervises the internship. This principles are introduced as well on the high school as on the college level. With an “ausbildungsintegrierende”  study, the student follows a bachelor study as well as an “Ausbildung”, a recognized professional training in a company. So at the end of your studies, he will receive a Bachelor's degree and a recognized professional title. A “praxisintegrierende” study, on the other hand, also has a theoretical and a practical part, but this practical part is not a recognized Ausbildung. He will therefore receive one diploma at the end, a bachelor's degree. The practical part usually involves a long-term internship at one company, but sometimes shorter internships at different companies.[3]

Typically for Eastern European countries, technical colleges that were very active and of high quality during soviet times, are still existing and some of them even arrived to adapt to the new world environment. We visited in February 2019 the Georgian Aviation University. This private university covers the entire range of professions in the aviation industry, from airplane construction, over airplane maintenance, airplane and helicopter piloting , to flight attendance, including drones development.[4]

However, in the first place we want to treat the steps that are being taken in European countries to continuously train already working citizens and to prepare them for a constantly changing working environment and renewed competency requirements. A country that has the ambition to be a knowledge economy in a globalized, competitive world with many Asian tigers, should focus on the best presenters in class. In this case, this is Denmark where 58 percent of the adults in 2018 participated in relevant training. The OECD average is 40%. In addition, 60 percent of the adults in Denmark have a higher education diploma, while the average for the OECD is 20 percent.[5]

There is no single description of 'mature student' in higher education, although some Member States do have a precise definition for policy reasons or to be able to count them in national statistics.[6]

The principle of lifelong learning has 3 major routes in Europe. There is the compulsory learning-replacing circuit where adults who have not been able to complete secondary education are offered a second chance, usually in evening classes. Classroom education is often supported by distance learning and / or e-learning.[7] This is called "blended learning". The same principle applies to higher education.

Then there is further education in which short or medium-term specialization programs are offered in evening classes that lead to a certificate or diploma. At university level, we speak of postgraduate or even master-after-master’s degrees.

In several countries, recognized professions such as accountant, general practitioner, dentist, lawyer, pharmacist etc. require permanent training of their members so that they can retain their recognition. A similar area of adult learning that has attracted attention at EU level is that of continuing vocational education and training (CVET). This is mainly funded by enterprises, possibly with some public contribution to back up policy priorities, such as extending opportunities to otherwise untargeted audiences. In the EU, 88 % of enterprises employing over 250 employees offer CVET to the benefit of 48 % of the employees. [8]

Participation in adult learning is higher for 25-54 year olds than for 55-74 year olds. One of the starkest gaps in participation rates is the difference between unemployed persons and employed persons.

And then there is also informal learning, which is encouraged by business sectors, where employees and workers or regular times are kept up-to-date on the initiative of the company itself of new techniques, but also of new management methods. Self-managing teams of highly skilled employees  are thus established and are constantly coached without falling into managerial principles. "Open” teachers value self-directed learning, collaboration, reflection, and challenge. They take risks in their way of learning, but this can be seen as an opportunity rather than a threat.[9]

There is a clear difference between the EU member states[10] regarding the range of training within companies. The large companies are more consistent in their offering than the small ones, with the small SMEs offering very different results. They recruit knowledge and, in a number of cases, make insufficient efforts to systematically increase the externally acquired competence internally.

Studies have shown that delivering quality education to the entire population leads to a level of knowledge and skills that traditional education systems can never achieve. Skilled workers and employees deliver a productivity gain as well as technological progress for business. The latter is achieved because trained employees are quicker to acquire new systems –even that were developed elsewhere- and also participate in innovative processes and systems within the company. Continuing education provides a social and institutional capital at population level that attracts investment and sustains growth. It also helps in building social trust, developing participatory societies, strengthening the rule of law and supporting good governance.[11]

Educational challenges for reindustrialization

The EU's education and training strategy of the previous EU Commission, ET2020, has been attentive to the issue of equity in adult learning. It stated that every adult should have the chance to learn and train, to obtain and maintain a job or to progress in a career. The strategy also recognised adult learning as essential for personal development and active citizenship.[12] The European Commission hosted also a ePlatform for Adult Learning in Europe, EPALE, a multilingual online space that brings together communities of practice, a resource centre, an events calendar and a a partner search-tool.

But, as in many cases, every DG within the E.U. administration and every parliamentary committee works on its own island and so here we also miss the coherence between the European Commission's commitment to re-industrialization and its commitment to quality education and training in a lifelong learning context .

The study by the professors P. Mengoli and M. Russo of the University of Modena and Emilia-Romagna (I) gives some very specific recommendations. They plead to support a more appropriate set of education and training activities to enhance knowledge-driven re-industrialisation. The main ingredients for them are[13] to boost innovation in the whole education system, from pre-school to university. In particular, the education and training system must take on the challenge to provide or to increase the provision of the ability to apply in different environments what has been learned. As second element they quote the understanding of the social, economic, historical and cultural heritage of the context in which people live and work and as third the mastering of knowledge of the core work processes.

We tried to develop these premises in our article and promote the dissemination of these principles in the various educational organisations of the member states. It is a very labour-intensive objective because so many regions, cities and training institutions are involved. They must each translate these objectives at their own level. In the field of adult education, they should also organise themselves in such a way that they combine their role of creator of social cohesion with their task as stimulator of diffuser of processional competences in every area. Only in this way can Europe live up to the challenge of re-industrialization and a future-oriented economy.

Louis Delcart, board member European Academy of the Regions, www.ear-aer.eu

[1] Paola Mengoli - Margherita Russo: Innovation in education and re-industrialisation in Europe, in:  DEMB Working Paper Series, N. 35, Dipartimento di Economia “Marco Biagi”, Università degli Studi di Modena e Reggio Emilia, July 2014 - http://www.ipyme.org/es-ES/Financiacion/Reindus/Paginas/Reindus.aspx

[2] Dries De Smet: Ondernemerschap is een culturele kwestie (Entrepreneurship is a cultural question) De Standaard - 23 september 2019

[3] Studeren en werken tegelijk: de duale studie (Study and work at the same time: the dual study) in Duitslanddesk,  Stichting Duitsland Instituut bij de Universiteit van Amsterdam, https://www.studereninduitsland.nl/studie-informatie/duitsland-onder-de-loep/duale-studies

[4] Presentation and dialog at Georgian Aviation University in Tbilisi, in ear-aer.eu, http://ear-aer.eu/2019/02/05/presentation-and-dialog-at-georgian-aviation-university-in-tbilisi-on-february-5th-2019/

[5] Wouter Duyck, Professor cognitieve psychologie (UGent): Vlaanderen leert niet graag (Flanders does not like to learn), in De Standaard, 11-7-2019

[6] Lifelong learning in the EU, in http://www.europarl.europa.eu/thinktank/infographics/lifelonglearning/index.html

[7] Louis Delcart: Rwanda Academy of Finance: the road to professional competence in Principles of Regional Approach-blog, 22-6-2019, https://lodelcar.tumblr.com/post/185770183790/rwanda-academy-of-finance-the-road-to

[8] Lifelong learning in the EU, in http://www.europarl.europa.eu/thinktank/infographics/lifelonglearning/index.html

[9] https://en.wikipedia.org/wiki/Lifelong_learning

[10] Lifelong learning in the EU, in http://www.europarl.europa.eu/thinktank/infographics/lifelonglearning/index.html

[11] https://en.wikipedia.org/wiki/Lifelong_learning

[12] http://www.europarl.europa.eu/thinktank/infographics/lifelonglearning/index.html