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Amid mounting pressure on the continent's industrial base, European Labour Commissioner Roxana Minzatu has warned that energy-intensive industries in the EU could lose up to 1.3 million jobs this year. According to reports, the automotive sector faces the most significant potential impact from rising energy costs linked to the ongoing conflict between the US and Iran. These warnings come as the closure of the Strait of Hormuz and soaring fuel prices threaten the competitiveness and operations of sectors including construction, chemicals, and metals.
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Sign InThese concerns coincide with a notable decline in economic confidence indicators across the region. Market data shows that Switzerland's employment level reached 5.537 million in May 2026, a slight decrease from the previous 5.544 million. Additionally, business confidence in Italy was recorded at 87.9 points, reflecting the cautious sentiment prevalent among European producers. Compared to prior earnings reports from major automakers like Volkswagen and Stellantis, there is a sustained squeeze on profit margins due to input costs, per market data and recent financial filings.
Investors should monitor upcoming economic data for signals on the crisis's depth, with markets awaiting European Central Bank President Christine Lagarde's speech and the monetary policy meeting accounts due on May 28, 2026. Furthermore, GDP data from Sweden and the broader Eurozone, expected on May 29, 2026, will provide clearer insight into how industrial disruptions are affecting economic growth. In the absence of specific instrument prices in this report, focus remains on manufacturing and employment indices as a compass for risk appetite in European markets.