Business | Falling behind

European firms are smaller and less profitable than American ones

The continent’s policymakers are right to be worried

A woman climbs stairs next to European flags. — Photograph: Getty Images

Sep 12th 2024

On September 9th Mario Draghi, a former prime minister of Italy and former president of the European Central Bank, published his long-awaited report on European competitiveness. The continent’s productivity lags behind America’s, and it lacks world-beating corporate giants. Rising geopolitical tensions have made this problem more acute for European policymakers. They are right to worry. Listed American firms are, on average, bigger and more profitable than European ones. The difference is particularly striking among tech firms, which are twice as profitable and more than ten times the size in America. ■

This article appeared in the Business section of the print edition under the headline “European firms are smaller and less profitable than American ones”