Italy's Mezzogiorno Region: Revitalizing Italy's Left-Behind Spaces
Italy’s North-South divide is one of Europe’s most well-documented spatial inequalities. In 2023, household income per capita was 30% lower in the South, in addition to an employment rate triple that of Northern Italy (12% vs 4% in 2024). These disparities have led to many towns across the Mezzogiorno region being designated as left-behind spaces, or ‘Aree Interne’ in Italian. In these towns, it’s common to see school roofs patched with emergency funds, shops being closed mid-week, and bars being used as post offices. 56% of Southern school buildings require urgent maintenance and postal counters are increasingly being replaced by pick-up/payment desks in bars. Italy’s South has been in a demographic decline for decades. Recently, Italy has faced a record-low 370,000 births, while emigration rose to over 20%. Trends that disproportionately affect the already-shrinking Southern provinces.
The Mezzogiorno region’s left-behind status is an accumulation of long-standing economic issues. Post-WWII industrial policy resulted in the government paying companies to open factories in the South. However, these branch plants sat far away from key suppliers, tacking a ‘distance-tax’ onto these factories and making them costly. Meanwhile, local governments were marred by clientelism and a lack of staff, which led to struggles monitoring regional development projects. Furthermore, informality and organized crime groups have undermined lawful business activity through extortion, collusive tendering, and the capture of public business works. Resultantly, lawful firms pay more and wait longer for investors, banks raise risk premiums on loans, and external lenders are scared off. Finally, increasing numbers of workers migrating to the Northern regions for stronger and clearer career prospects further added to the region’s economic woes. Fewer in-region firms led to fewer jobs, causing an exodus of the region’s young workers, with fewer young families leading to lower fertility rates. These trends are reflected in Calabria and Campania, two Italian provinces in the Mezzogiorno, having two of the lowest regional employment rates in the EU (48.5% and 49.4% respectively). Additionally, roughly 500,000 new graduates migrated to the Centre-North region over the past two decades. These are just some of the factors that are anchoring the region in an agonizing and predictable decline.
Recently however, there have been efforts made to revitalize the region. The EU National Recovery and Resilience Plan has poured billions of dollars into funding rail, port, and school infrastructure. 40% of these funds are directly towards the Mezzogiorno region with flagship projects like the Naples-Bari high-speed railway and the Salerno-Reggio Calabria motorway. Even the highly controversial and costly Messina Strait Bridge is being revived, with the Meloni government giving the project a final approval in August of this year. This billion-euro project would be the longest suspension bridge in the world, with many critics citing the environmental and technical risks that come with building along a highly seismic and windy area. Others warn that the high cost may crowd out infrastructure spending in other areas including local rail, hospitals, and schools. These various projects illustrate how the revitalization of the Mezziogiorno is centered around improving infrastructure in order to connect these peripheral labor markets to dynamic city hubs. However, these infrastructure projects need to be accompanied by meaningful job growth and opportunities people can actually take.
The good news is that there are new opportunities that are starting to materialize in renewable energy manufacturing, rail logistics and tourism. In energy manufacturing, Enel’s 3-sun solar gigafactory in Sicily is looking to expand their operations and employee count by the thousands after securing a $610.2 million dollar financing package from the EU Investment Bank. This emerging cluster shows that European re-industrialization can take place in the Italian South when supply chains, finances, and workforce training align.
Meanwhile, the Gioia Tauro in Calabria, Italy’s largest container port, measured 10.5% growth in H1-2025, and is on track to surpass 4 million TEU in storage capacity by the end of the year. The delivery of new cranes and hybrid straddle carriers in 2024 have been the primary driver behind the port’s growth, raising productivity and big-ship capability. As the country simultaneously upgrades the Salerno-Reggio Calabria railway, more shipping containers can move inland by train. Job growth in the Gioia Tauro has heavy potential, but only if rail expansions can help push containers onto the mainland, and firms co-locate warehousing around the port area. While the port remains Italy’s top-performing transshipment hub, it has significant headroom to become an even larger employer for the region.
Finally, the National Recovery and Resilience Plan’s “Borghi” program finances 289 local regeneration projects across the Mezzogiorno’s small towns. These funds are channeled into cultural hubs, digital nomad spaces, trail and heritage restoration, and hospitality services. This not only generates increased tourism, but also creates local employment ladders ranging from cultural managers, to tour guides, to guesthouse operators, to venue technicians, to facility maintainers. When these regeneration projects are paired with vocational training, Southern municipalities have seen the emergence of small enterprises, longer seasons for business, and re-opened communal spaces (markets, libraries, workshops).
Despite the numerous investment plans pouring in to revitalize the region, it’s hard to tell whether these projects will stick the landing. However, revitalization efforts should not forget about the impact of social services. Italy should focus on making childcare and essential services the backbone of its plans. While much of the work being done now is centered around job creation and infrastructure, they cannot curb the demographic decline alone. With more reliable childcare, schools that are open and adequately staffed, and employment contracts that don’t penalize parenthood (less involuntary fixed-terms). Without an improvement in these everyday social services, job growth won’t translate into retention, and families will keep emigrating as raising a family remains too costly and difficult.
The Mezzogiorno is not forever condemned to be a left-behind region. If investment centers around expanding social services in childcare and education, and on widening opportunities in energy, shipping logistics, and culture, the new rail networks and ports can move people into jobs, rather than out of towns. Impressive and expensive infrastructure projects sound exciting on paper, but a stronger economic and social service foundation must be built if the Mezzogiorno wishes to retain its young workers and families.
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