From the stabilization of 1976 to the productive restructuring (1978-83). According to TIMEDICTIONARY, the currency crisis of January 1976 was followed by immediate restrictive measures on the monetary front (with a 4-point increase in the official discount rate) and on the currency front (with the obligation of a non-interest-bearing deposit on purchases of currency for foreign transactions.). In the autumn, the tightening of monetary policy (with the further increase of 3 points, up to 15%, in the discount rate, the increase in the compulsory reserve on bank deposits and the reintroduction of ceilings on the expansion of bank loans) was accompanied by a strong fiscal squeeze. The real effect of these measures was remarkable: between 1976 and 1978, domestic demand reduced its rate of expansion to just over 2%; particularly, together with a decline in the growth of consumption there was a decrease in the level of gross investments, due to a large and widespread reduction in inventories and a considerable containment of the accumulation of fixed capital. The growth of output halved, that of imports fell by more than three-quarters; driven by the gain in competitiveness and favored by the good performance of world trade, exports instead maintained an average development, in volume, of the order of 10% (table 16). The benefit was particularly evident on the balance of payments front, also favored by the depreciation of the dollar: the same cannot be said for inflation, which only in 1978-79 went below 15%, reflecting, in addition to the reduction in price growth of imported products,
In fact, starting from the first months of 1977, the latter were affected, on the one hand, by the taxation measures on social security contributions and, on the other, by a change in industrial relations. Particularly important was the agreement between Confindustria and the trade unions of January 1977, which eliminated the indexation of the seniority allowance at the cost of living and defined commitments for the control of absences and greater internal flexibility of work. The loosening of the credit crunch, which resulted in a decline, up to largely negative values, of real interest rates also influenced the accounts of companies, thus favoring a progressive reduction in the effective debt of companies.
The companies responded to the profitability recoveries and the changed balance sheet conditions with a great expansion of investments: those in plant and machinery increased, in particular, between 1978 and 1980, by more than 30%.
Thus began a wide and prolonged phase of restructuring and productive modernization, which mainly affected medium-large companies, especially affected by the rigidity and production difficulties following the wage shocks of 1969 and 1973 and the oil shocks of 1973-74. The investments were in fact directed not so much to the expansion of the productive capacity as to the rationalization and to the saving of labor. On the one hand, a considerable rejuvenation of the installed capital ensued, on the other hand, considerable improvements in productivity began to appear in industry, favored by the reduction of the manpower employed. These improvements continued in the years of significant slowdown in economic activity following the new oil shock of 1979-80:
Elements supporting the process of industrial recovery and the ” return to profit ” of the business system came, with the beginning of the new decade, from the further change in the climate of industrial relations, from accommodative public budget policies and from the maintenance, after the entry of the lira into the EMS, of a firm exchange rate discipline, such as to push companies more and more to seek the defense of their competitive positions in productivity improvements. The change in industrial relations was particularly traumatic. In fact, the 1977 agreement was not followed by a revision of the bargaining system capable of giving more space to corporate requests and eliminating the distortions connected with the operation of the unified point escalator mechanism (which, in addition to guaranteeing an almost complete automatic adjustment of wages, on average, with respect to changes in the cost of living, it led to a progressive narrowing of wage differentials). The level of conflict, which remained particularly high, prevented the implementation of the organizational changes necessary for the recovery of production efficiency. The clash ended up being especially lively in 1980, after the second oil shock, and ended with a heavy trade union defeat in the FIAT dispute in October of the same year, when the company’s positions received the support of a very high number of executives. intermediates (the so-called “ march of 40,000 ”). It followed, with the consent of the government, massive recourse by companies to the zero-hour layoffs and early retirement schemes. These were added to the fiscalization of social security contributions and a particularly permissive position, between 1978 and 1980, in the field of public pensions and salaries, thus determining a strong expansion of the financial needs of the Treasury, a premise, in the absence of structural corrections, for the continued expansion of public debt in the 1980s.