Europe's Labor Market Alerts: Employees Prepare for Potential Impacts of Tariffs
In 2025, the European labour market is facing challenges due to the effects of US import tariffs. The economic signals suggest that workers may have less power to protect themselves as their jobs and incomes come under strain.
According to the ITUC Global Rights Index 2025, Europe's labour rights have deteriorated, with an average score of 2.78, indicating a rapid decline compared to previous years. Nearly three-quarters of European countries violated the right to strike, and more than half were denied or restricted access to justice.
One of the most noticeable trends is the decline in job vacancy rates. The first-quarter job vacancy rate in the eurozone was 2.4%, a drop from the 2.9% recorded in the same quarter of the previous year. The job vacancy rate dropped the most in Germany, Greece, Austria, and Sweden.
The number of hours worked also decreased by 0.3% in the first quarter of 2025 compared to the previous quarter, indicating underemployment and less stable employment conditions in tariff-affected industries.
The European economy is facing challenges due to tariff rates. Tariffs raise the cost of EU goods in the US, pressuring EU exporters and potentially leading to reduced employment in affected sectors. However, if EU companies successfully redirect exports internally within the EU or to other regions, this negative employment impact can be somewhat mitigated.
The extent of the impact also depends on how much tariff costs are passed on to consumers and how substitutable EU products are with competitors’ goods. In practice, early 2025 data show a trend of deterioration in Europe’s labor market, with job vacancy rates falling, average hours worked shrinking, and underemployment rising.
These conditions weaken workers’ bargaining power just as their jobs and incomes come under pressure from the tariff environment and broader economic cooling. Concurrently, there is a marked increase in labor rights violations—such as restrictions on striking and access to justice—which further undermines workers’ protections and employment stability.
Macroeconomically, prolonged trade tensions and tariff pressures could contribute to reduced investment and economic growth in Europe, indirectly affecting employment beyond direct trade channels. Although some sectors or countries might gain market share if competing nations face higher tariffs, the overall effect on EU employment remains fragile amid such global uncertainties.
The next few quarters will reveal whether these shifts are temporary tremors or the start of a deeper downturn for Europe's workforce. As it stands, the impact of US import tariffs on European employment stability in 2025 manifests through several related trends: a decline in job vacancy rates, reduced hours worked, and deterioration of labor rights, all indicating stress on employment conditions.
[1] Source: Various economic reports and analyses. [2] Source: ITUC Global Rights Index 2025 and European statistical data.
- Despite the challenges in the labour market due to US import tariffs, the decline in job vacancy rates in countries like Germany, Greece, Austria, and Sweden might lead to less opportunity for sports organizations to hire new coaches, trainers, and athletes.
- As underemployment rises and labor rights violations increase, it becomes increasingly difficult for workers to advocate for better working conditions, potentially affecting the scheduling of sports events and the organization of leagues, as they may not have the power to negotiate suitable weather arrangements for outdoor sports activities.
