Moderate but solid recovery in domestic consumption
Italy’s economy, despite a projected stagnation in 2024 with GDP growth stuck at 0.5%, presents promising signs for the following years. According to Unimpresa’s report, 2025 will see domestic consumption rise by 1.8%, supported by a purchasing power increase (+3% in 2024, +1.7% in 2025). This improvement is also backed by a strong labor market, with unemployment at 5.8% and stable job growth.
The services sector, especially tourism-related industries, is expected to grow by 2.7% in 2025, reaffirming its central role in the recovery. Meanwhile, non-residential and infrastructure construction will benefit from accelerated NRRP funds, with spending forecasted at €45 billion in 2025 and €84 billion in 2026.
Structural challenges ahead
Nevertheless, challenges remain. The export sector shows weakness, hindered by reduced demand in Europe, with growth forecasted at just 0.6% in 2025, while imports rise by 1.7%. Adding to this, potential US tariffs, especially in the automotive sector, could further hamper Italy’s exports.
The labor market, although improving, shows vulnerabilities. Employment growth primarily concerns those over 50, while younger demographics see a rise in inactivity. In construction, the end of the Superbonus has led to a decline in residential investments, partially offset by growth in non-residential projects supported by NRRP funding.
NRRP and foreign trade: opportunities to seize
The NRRP is a vital tool for modernizing Italy and ensuring a stable recovery. However, delays in project execution pose significant risks. In the first 10 months of 2024, only €17 billion of the planned €22 billion were spent. Still, the updated plan promises acceleration in 2025-2026, which could provide a positive boost to the economy.
On the international front, demand from the United States offers a ray of hope, with growth projected at 2% in 2025, potentially offsetting the weakness in European markets.
Conclusions and outlook
As highlighted by Unimpresa’s president, Giovanna Ferrara, Italy’s economic recovery is achievable but requires shared responsibility from all economic actors. Strengthening purchasing power, tourism, and meeting NRRP deadlines will be key to turning positive signals into a prosperous future.
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