News | Economic / Social Policy - Europe - Energiekrise Mapping Europe’s Cost of Living Crisis

A new project tracks the continent’s growing social crisis and political responses to it

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Author

Nessim Achouche,

Thousands rally in Toulouse, France during a day of nationwide strikes to protest against government inaction in the face of rising inflation and living costs, 18 October 2022.
Thousands rally in Toulouse, France during a day of nationwide strikes to protest against government inaction in the face of rising inflation and living costs, 18 October 2022. Photo: IMAGO/Alain Pitton

Price hikes in the energy sector across Europe in autumn of last year marked the outset of what we now know as the cost of living crisis. The energy component of the crisis became more acute with the start of the war in Ukraine in February 2022, prompting most of Europe to wean itself off of Russian gas, while also stoking fears among the general population whether energy supplies would be sufficient to keep people warm this – or even next – winter.

Nessim Achouche works as a project manager at the Rosa Luxemburg Foundation’s Brussels Office.

Yet while European consumers spent the year agonizing over whether they would be able to heat their homes, energy companies racked up record returns. In 2022, seven of the major oil and gas companies pulled in more than 150 billion euro in windfall profits. This stands in stark contrast to the roughly 34 million people the European Commission estimated to be living in energy poverty in 2021, a figure that has risen drastically in 2022.

Price rises have not been limited to the energy sector, however. Increasingly, we can see them spreading from energy into other sectors, with food being one of the most quickly affected. The housing sector has also seen prices skyrocket, putting millions of Europeans living in rental accommodations in a difficult, if not impossible situation.  

This situation of generalized price rises is a complex phenomenon to unpack, impacted by the varying levels of financialization in specific markets and reinforced by the intricacy of global value chains. However, another determining factor is blatant: the fact that generalized inflation has not been matched by generalized pay rises anywhere in Europe. Nevertheless, trade unions have responded to this wave of impoverishment with a growing number of strikes and blockades, while social movements and activist groups have sought to organize resistance on a local scale.

It is in this context that the Rosa Luxemburg Foundation, together with the Corporate Europe Observatory and Gastivists, is launching the European Mapping of the Cost of Living Crisis. The website, which features both a visual map as well as a larger database, is an attempt to capture at least a few snapshots of this rapidly developing process. Providing detailed figures for nine European countries, it enables users to compare different national contexts while offering an overview of the situation on the continent as a whole. It also lists political actions in response to the crisis, whether at the national or European level, and informs on measures that governments have put in place to mitigate some aspects of the crisis (price caps, windfall taxes, tax cuts).

The platform’s emphasis on industrial actions and popular movements across the continent is designed to further a broad politicization of the cost of living crisis. For while the majority of workers, citizens, and society’s most vulnerable groups find themselves struggling to cope with deteriorating living conditions, large corporations and financial institutions are making huge profits in what amounts to a massive upwards transfer of wealth from the majority to the elite.

The European Mapping of the Cost of Living Crisis represents a snapshot of an ongoing process. The tool is an unfinished project that will continue to evolve along with the situation on the ground. We will continue to update the data and provide analysis on developments in different sectors, while highlighting political solutions to what are ultimately mere symptoms of a wider political crisis. We welcome input from both individuals as well as organizations on how we can improve the project together.