How AI can lift manufacturing out of its productivity and staffing squeeze in World Economy News 30/03/2026 Manufacturing risks missing out on major productivity gains Larger manufacturing companies use AI three times as often as smaller companies AI adoption is strongly related to company size. Larger manufacturing companies with 250 or more employees use AI three times as often (namely 64% of the total) as smaller companies with 10 to 50 employees (21%). Although fast-growing AI frontrunners are often small startups or scale-ups, scale itself appears to be the differentiating factor for most mature manufacturing companies. Across the industry, hundreds of AI use cases have now been identified, and most surveyed manufacturing companies expect a positive return within one to four years. EU manufacturing is increasingly using AI, but is still lagging behind other sectors EU manufacturing companies are increasingly incorporating AI into their business processes. In 2025, 17% of manufacturers used AI, two and a half times as many as in 2023. The share of ‘heavy users’– companies using at least three AI technologies – quadrupled over the same period to 6%. But the downside is clear: laggards are struggling to catch up with the frontrunners. And with average AI use across EU sectors now at 20%, compared with 17% in manufacturing, the industry still has some ground to make up. Belgium and Denmark are the industrial AI leaders within the EU Industrial AI adoption varies widely across the EU. While fewer than one in ten manufacturing companies in Romania and Poland use AI, the figure rises to one in three in Sweden and Austria. In other Northwest European countries such as Belgium and Denmark, it’s closer to two in five. Despite these differences, AI adoption is accelerating rapidly across the EU. In almost every EU country, the number of manufacturing companies using AI has more than doubled in the past two years. Industrial investment in software is growing rapidly in the EU… Productive AI deployment requires larger software investment. In the larger EU countries for which data is available, industrial investment in software and databases has increased significantly over the past 10 years. While the value of software and databases owned by manufacturing companies increased sharply – by 33% between 2013 and 2018 – due to additional investment, growth accelerated even further between 2018 and 2023 (the last year for which data is available for nine larger EU countries), exceeding 50%. This is a very strong increase comparable to the average software capital growth in all sectors. This particularly stands out when compared to the 5.5% growth in total capital goods in the manufacturing industry and the growth of only 2.5% in ownership of computer hardware. Industrial software assets in major EU countries grow much faster than total capital stock Net capital stock development in the manufacturing sector, unweighted average of nine larger EU economies for which data is available, 2018 = 100 …but German manufacturing needs to catch up to harness the potential of AI In some countries, investments in industrial software are clearly lagging behind. This is particularly true for the Netherlands, where software ownership fell by 9% between 2018 and 2023. While there is growth in Germany and Italy (+8% and +17%, respectively), it lags far behind the average growth of 51%. The Netherlands does start from a high level, however. In 2018, the Dutch manufactur