Feb. 19th, 2026

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Europe's Labor Laws Are Strangling Its Ability To Innovate, New Analysis Argues

A new essay in Works in Progress Magazine argues that Europe's failure to produce a Tesla or a Waymo stems not from insufficient research spending or high taxes — problems California shares in abundance — but from labor laws that make it devastatingly expensive for companies to unwind failed bets.

According to estimates, corporate restructuring costs the equivalent of 31 months of salary per employee in Germany, 38 in France, and 62 in Spain, compared to seven in the United States.
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