Industrial Relocation and Urban Restructuring: Between Decline and Global Connectivity in Setúbal

Abstract

Setúbal Peninsula (SetPe) has played a critical role in Portugal’s industrial history, symbolizing economic growth in the 1960s and serving as the centre of the working-class movement during the Carnation Revolution. This study examines the impacts of deindustrialisation and integration into Global Network and Chain Structures (GNCS) on the region’s daily life and urban areas. Despite the decline in industrial employment and the challenges posed by abandoned industrial areas, the region has remained connected to GNCS through existing industrial facilities. The study utilised both quantitative and qualitative methods to analyse these transformations and highlighted the region’s vulnerability in the face of these global processes. The findings suggest that integration into GNCS in SetPe has led to economic dependence on multinational companies, social and cultural decline, and challenges in urban redevelopment.

1. Introduction

The integration of regions into Global Network and Chain Structures (GNCS) has profoundly reshaped industrial cities/regions worldwide. In this study, we adopt the term GNCS as an umbrella concept that encompasses Global Value Chains (GVCs), Global Production Networks (GPNs), and Global Commodity Chains (GCCs). While these frameworks share an interest in the transnational organisation of production, they differ in emphasis. GVCs focus on firm-level upgrading and governance [1], GPNs explore the relational and institutional embeddedness of production [2,3], and GCCs underscore commodity flows and systemic labour dynamics [4,5]. Our use of GNCS aims to bridge these perspectives by highlighting both the economic and socio-spatial transformations associated with global industrial integration.

Historically, the Setúbal Peninsula (SetPe) in Portugal exemplifies the profound impacts of these global processes. Shaped by heavy industrial investments and a strong working-class culture, SetPe played a critical role in Portugal’s industrial history and was central to the Carnation Revolution of 1974. Yet, with Portugal’s accession to the European Economic Community (EEC) and the rise of global competition, the region faced economic decline, the closure of major industrial facilities, and the disintegration of its social and cultural fabric. Today, while SetPe remains connected to global production systems through existing industrial activities, it struggles with abandoned industrial areas, urban stagnation, and rising inequalities.

SetPe faces ongoing structural challenges resulting from long-term deindustrialisation and uneven integration into GNCS. Economically, the region has seen a substantial decline in manufacturing employment—losing over 40,000 industrial jobs since the 1980s—and now depends heavily on a limited number of firms, such as Volkswagen Autoeuropa. Socially, this process has led to youth outmigration, rising precarious employment, and the erosion of collective labour traditions. Entire neighbourhoods, particularly in Barreiro and Seixal, show visible signs of abandonment, underinvestment, and rising inequality. Spatially, the post-industrial landscape is characterised by extensive brownfields, stalled urban redevelopment projects, and fragmented governance over land use and environmental liabilities. These overlapping dynamics underscore the urgency of a more spatially attuned analysis of global production processes and their localised consequences.

While studies on global production often prioritise firm-level competitiveness or national development outcomes, fewer have explored the socio-spatial consequences at the urban or regional scale. For instance, GVC literature [1,4] tends to focus on governance structures and upgrading paths, whereas GPN approaches [2,3] place greater emphasis on relational embeddedness and institutional configurations. Critical perspectives [6,7,8] highlight the exploitative dynamics and asymmetrical power relations inherent in these networks. Methodologically, these studies range from quantitative panel data models to ethnographic labour studies; yet, few combine spatial theory with historical-institutional analysis in post-industrial urban contexts. Our study builds on this gap by integrating spatial production theory with mixed methods to explore how global industrial restructuring manifests in the everyday and material fabric of SetPe.

Therefore, this study seeks to contribute to the literature by offering an empirically grounded and spatially sensitive analysis of deindustrialisation and SetPe’s integration into GNCS—highlighting the often-neglected intersections among economic restructuring, urban form, and social disintegration.

Building on Lefebvre’s [9] concept of the production of space and Harvey’s [10] theory of the spatial fix, the study conceptualises space as a dynamic entity continuously shaped by economic policies, labour processes, and power relations. Furthermore, Massey’s perspective [11] on the multi-scalar relationality of space highlights how global processes cannot be understood independently of local dynamics. This theoretical framework allows us to interpret SetPe’s transformation both as a localised phenomenon and as part of broader global processes.

The key objectives of this study are:

(1)

To examine how deindustrialisation and integration into GNCS have transformed SetPe’s economic, social, and spatial structure.

(2)

To analyse the impacts of these transformations on working conditions and the socio-cultural life of the local working class.

In doing so, this study aims to contribute a spatial perspective to the GNCS literature while offering insights for sustainable urban and industrial policy. By integrating both quantitative and qualitative methods, the research highlights the challenges of economic dependency, urban stagnation, and the fragmentation of once-vibrant industrial communities.

The remainder of this article is structured as follows: Section II outlines the methodology, Section III contextualises Portugal’s economic transformation, Section IV develops the theoretical framework, and Section V examines the empirical findings on SetPe’s transformation amid its integration into GNCS. In Section VI, the construction of the global factory as a tool for development is examined. The article concludes with the results and discussion section.

2. Materials and Methods

This study combines a cross-sectional survey with interviews, a focus group discussion, and field observations. Quantitative data establish baseline patterns in income, living conditions, and employment, while qualitative data supply contextual depth.

2.1. Quantitative Research

Population and sampling. The universe comprises ≈ 10,000 unionised metalworkers across SetPe, concentrated primarily in the automotive sector. A computer-generated sample of 360 workers (95% confidence level; ±5% margin of error) was envisaged, but organisational constraints on membership lists and survey fatigue yielded 80 returns, of which 75 were valid.

2.1.1. Data Collection

Questionnaires were distributed by SITESUL shop stewards between April and June 2023 and retrieved in July 2023. Items were adapted from Eurostat modules on income, living conditions, and housing; wage brackets refer to net monthly earnings in euros.

2.1.2. Sample Coverage and Limitations

The 75 valid cases equal 8% of the targeted sample and <1% of the entire industrial labour force in SetPe. All respondents are union members; non-union, precarious, and undocumented migrant workers are therefore absent. Regional union density in the industry is only 20–25% (INE/Fiequimetal). The mean age (43 years) matches the regional industrial median (45.5 years). Women account for 29% of respondents, slightly above the estimated 20% female share in ICEW in SetPe.

Participants ranged in age from 23 to 58 years, with an average age of 43. Approximately three-quarters were employed in the automotive sector, with 43% (32 individuals) working at Volkswagen Autoeuropa (AE) [12].

2.1.3. Research Focus

Unionised metal/automotive workers—particularly those employed by Volkswagen Autoeuropa—were placed at the analytical centre to trace the spatial effects of lead firms within GNCS. By examining livelihood strains among this relatively advantaged group, we test claims that GNCS participation delivers economic and social upgrading. Evidence of inadequate income or living conditions among VW workers is thus crucial to our research question.

2.1.4. Data Analysis

The data were analysed using IBM SPSS Statistics, version 24 for macOS, employing frequency distributions and cross-tabulations. The survey questions and methodology were adapted from Eurostat [13,14] on income, living conditions, and housing.

Table 1. Survey vs. official indicators for the Setúbal Peninsula.

Category	Survey	Official	Explanation	Source
Wage 1	15% < €1.000; 67%€1.000–1.500; 13% > €1.500	Avg. €1.370	Manufacturing, SetPe (2023)	INE–MTSSS/GEP
Female ratio	29%	20%	Employees in ICEW, SetPe (2022)	INE–MTSSS/GEP
Average age	43	45.5	Skilled workers in ICEW, Portugal	INE, Census 2022
Primary-school graduates	28%	31.7%	ICEW, Portugal	INE, Pop. & Housing Census 2020 Q4
High-school graduates	51%	53.5%	ICEW, Portugal	INE, Pop. & Housing Census 2020 Q4
University graduates	21%	14.3%	ICEW, Portugal	INE, Pop. & Housing Census 2020 Q4
Union member- ship	100%	∼20–25%	Industrial workforce (region, est.)	INE (est.)

¹ Survey wage brackets refer to net monthly income. ICEW = Industry, Construction, Energy and Water sector.

contrasts key survey indicators (wages, age, education, union status) with official statistics from INE–MTSSS/GEP.

2.2. Qualitative Research

The qualitative research aimed to provide an in-depth understanding of workers’ views on the transformation of the industrial structure, the role of labour unions, and socio-political developments in the region. The following methods were used: semi-structured interviews were conducted with three mayors of SetPe (one of whom is a former mayor) and the president and executives of the Fiequimetal Federation. Due to the low survey participation, a focus group discussion was held at the Volkswagen factory in SetPe with four workers, one of whom was a union representative.

Additional interviews and field visits were conducted in Barreiro, a municipality in SetPe, involving a municipal councilor and a former union leader. Visits included the industrial museum and abandoned industrial zones. The qualitative data were analysed using thematic analysis, which involved the following steps: transcription of interviews, coding, identification of themes, data analysis, and reporting. This approach ensured a systematic examination of the data and enabled the identification of key patterns and themes.

2.3. Data Integration Strategy

To ensure consistency and complementarity across data sources, we adopted a mixed methods triangulation approach. Quantitative survey data were used to identify general patterns in income, living conditions, and employment among industrial workers. These findings were cross-referenced with themes derived from semi-structured interviews and focus group discussions, which provided deeper context and personal narratives. Historical analysis and field visits further grounded these perspectives within the material and spatial transformations of the region. Together, this multi-scalar methodology allowed us to synthesize empirical insights with theoretical interpretations drawn from the literature on spatial production and global production networks.

2.4. Ethical Approval

The study received clearance from the Ethics Committee of Instituto Superior Técnico (Ref.13/2023[CE-IST], 6 June 2023). All participants signed informed-consent forms compliant with GDPR.

2.5. Limitations

The inability to achieve the target sample size limits the generalizability of the findings. Furthermore, the inclusion of only unionised workers restricts the representativeness of the sample to the broader workforce population in the region. As such, the results may not fully capture the experiences of all workers in SetPe. Nonetheless, a comparison between survey findings and qualitative data revealed consistent patterns.

Despite the limited sample size, the qualitative data from interviews and focus group discussions provide in-depth insights that complement the quantitative findings.

Moreover, while the qualitative component provided valuable insights into the perceptions of political and labour elites, such as union leaders and local government officials, it did not capture the perspectives of other relevant social actors—namely grassroots organisations, environmental groups, women workers, or unemployed youth. This represents a limitation in the diversity of viewpoints addressed, and future research would benefit from expanding the range of oral testimonies to better reflect the multiplicity of experiences shaped by industrial transformation.

The overall research design—linking data inputs, theoretical lens, analytic procedures, and expected outputs—is summarised in Figure 1.

3. The Integration Process of the Portuguese Economy into the GNCS

In the first half of the 20th century, Portugal’s economy was predominantly agricultural and relatively isolated from global markets [15]. Under the Estado Novo regime (1933–1974), economic activities were strictly regulated through interventionist policies aligned with fascist ideologies [16]. The regime prioritised agricultural self-sufficiency, providing subsidies and loans to sectors such as food and textiles. Corporatism—rooted in colonialism, protectionism, and extreme income inequality—defined the economic structure for decades, although significant infrastructure investments were made during this period [15].

After World War II, Portugal joined international organisations like the OECD and NATO [15,17]. Its industrial structure was initially dominated by textiles, food, and cork [18]. Development plans focused on addressing economic challenges such as unemployment and low productivity [15].

Starting in 1960, Portugal pursued industrial growth through international financial institutions and large monopolies [17]. The country shifted from an import substitution strategy to export promotion, resulting in increased industrial output, higher industrial employment, and a decline in the agricultural sector’s importance [18]. Modernisation efforts included joint ventures between Portuguese business groups and multinational companies in shipbuilding and chemicals [16].

The 1960s, known as the decade of textiles, also saw growth in chemicals, machinery, metals, and other sectors such as non-metallic minerals, wood, and furniture [18]. This period marked significant product diversification and the development of regional industrial hubs, notably the SetPe.

During the Estado Novo dictatorship, seven large business groups dominated the economy, thriving under state concessions and monopolies. The largest, Compahia União Fabril (CUF), comprised approximately 186 companies across various sectors, accounting for around 10% of the country’s GDP and employing about 100,000 people [16,17]. These firms primarily focused on the domestic market and colonial markets.

Between 1960 and 1973, Portugal’s emphasis on heavy industrial investments and policies encouraging foreign capital inflows led to significant growth in per capita income. In 1973, for the first time, employment in the manufacturing sector (785,000) nearly equaled employment in the agricultural sector (791,000) [19].

The Carnation Revolution on 25 April 1974 ended the 48-year dictatorship and initiated profound transformations. During the PREC period (Processo Revolucionário em Curso) between mid-1974 and late 1975, provisional governments addressed macroeconomic challenges and the immediate needs of the population. The large family-controlled business groups that had dominated under the Salazar regime were nationalised. Portugal established a national minimum wage, and the rights to strike and lockout were legalised. The 1976 Constitution approved agrarian reforms, established a planned economy, and prioritised public education and health, leading to rising wages and improved living standards [15,20].

This extensive nationalisation created the largest public enterprise sector in Portugal’s history. By 1980, a significant portion of the economy was under state control, accounting for about 23% of gross value added, 19% of employment, and 43% of gross fixed capital formation [20,21].

However, the IMF’s 1981 report [22] highlighted that the balance of payments deteriorated due to irreversible factors such as rising global oil prices and the loss of privileged markets in Africa. These shocks were met with sharp increases in real wages, but wage cuts were considered necessary for long-term growth, even if this led to increased inequality.

As a result, the harmony between societal and governmental expectations created by the revolution became increasingly influenced by external factors. The share of wages in national income, which had increased from 76% to 94% after the April Revolution, dropped to 71% in 1980 and 60% in 1984 (Figure 2).

Following the profound economic and political upheavals of the late 1970s, Portugal swiftly reached the limits of its inward-oriented, protectionist industrialisation model. The nationalisations under the PREC and the IMF-supported structural adjustment programmes forced both the public and private sectors into comprehensive restructuring. Reinforced by competitive pressures accompanying Portugal’s 1986 accession to the European Economic Community and by incentives from international financial institutions, this process enabled a decisive reorientation of domestic industry towards export markets. In the next section, we examine the strategies of export-oriented industrialisation and the integration practices into GNCS in SetPe that emerged from this transformation.

4. Transition to Export-Oriented Industrialisation and GNCS

Since the mid-1970s, exports from developing countries have grown faster than those of industrialised nations, driven by a shift from Import Substitution Industrialisation strategies to Export-Oriented Industrialisation, guided by International Financial Institutions and supported by GNCS dynamics [24].

Early research into new forms of the international division of labour focused on the reorganisation of global production and the relocation of production units from traditional centers to less developed peripheral countries for cost advantages. Described by Fröbel et al. [25] as “World Market Factories”, this structure created complex networks and fundamentally altered spatial dynamics, thereby increasing the determinative influence of MNCs.

Scott [26] argues that the spatial characteristics of cities and regions arise from the social and technical relations of commodity production, and that urban development is shaped by local processes. In line with Scott’s propositions, in the case of SetPe, concentrated production activities stimulated social reproduction. Industrial intensification led to the development of the labour market, the expansion of residential areas, a vibrant social life, and a distinctive urban culture. Trade unions played an important role in local politics, strengthening collective learning and worker solidarity. However, increased organised political activity raised operating costs for enterprises, prompting capital to relocate production units away from central locations, resulting in spatial fragmentation. In SetPe, this dispersal weakened the social and cultural fabric of previously concentrated areas and led to economic decline and social fragmentation.

In today’s global capitalism, MNCs have increasingly asserted dominance over space by incorporating surplus labour and capital into urban systems, thereby enhancing labour control [10,27].

SetPe exemplifies this process. Once characterised by large-scale industrial investments, strong unions, and a militant working class, the region underwent transformation during the EEC accession. Due to state indifference and competitive pressures from the EEC process, national enterprises faced difficulties [28], leading to closures, privatisations, and subcontracting. This ultimately caused economic collapse and the deterioration of social and cultural life, making the region’s production dependent on global companies’ investment decisions.

The SetPe bears the marks of the wave of deindustrialisation after the 1970s. In an effort to reduce production costs, the relocation of industry to peripheral regions caused substantial losses in areas such as northern England, central Scotland, France’s Lorraine region, Germany’s Ruhr area [29], and the U.S. Rust Belt. This process has exacerbated inequality and exclusion [11,30]. The collapse of industry is not merely an economic transformation; it is a profound process that impacts social structures, individual identities, and spatial organisation, triggering feelings of loss, mourning, and alienation [31]. By foregrounding this sense of mourning and loss, the study examines the spatial traces of deindustrialisation in collective memory.

4.1. Conceptual Framework (GCCs, GVCs, GPNs, GNCS)

This study uses the GNCS framework to understand these processes, focusing on their spatial impacts. The spatial effects of production transformations are analysed in two dimensions: changes in urban and everyday life practices and labour conditions.

Literature identifies various concepts for globalised networks and chain structures. Global Commodity Chains (GCCs) define labour and production processes in networks culminating in final products, showing how production, distribution, and consumption are shaped by social relations and organisational structures [5]. Subsequently, some proponents of “Global Commodity Chains” proposed “Global Value Chains” as a more inclusive term [32]. A value chain refers to the sequence of activities firms undertake to add value to a product or service from design to delivery (e.g., production, processing, marketing, transportation, distribution), typically occurring in multiple countries [33,34].

Global Production Networks (GPNs) expand GCCs by replacing “commodity” with “production” and “chain” with “network”, focusing on the social conditions of production and consumption, emphasizing labour reproduction and system autonomy. It allows for a deeper understanding of network complexities [2].

Over time, GVCs and GPNs have converged as critical platforms for coordinating global production across sectors [35], highlighting the development and consolidation of globally integrated economies [8]. In this context, GPN v.2, developed by Yeung and Coe [35], extends earlier frameworks by focusing on how firms adapt to shifting competitive dynamics and risk environments through spatial strategies, including embedding and disembedding practices. While GPN 2.0 offers a firm-centric view of territorial embeddedness, our analysis emphasizes the agency of labour, the resistance of local actors, and their role in disrupting spatial fixity. In SetPe, historical union militancy has actively challenged embeddedness, contributing to capital’s relocation decisions.

SetPe case demonstrates that the predominance of multinational corporations does not necessarily foster local development when labour struggles, wage demands, or collective bargaining efforts erode the locational advantage. These dynamics not only confirm the flexibility insights of GPN 2.0 but also, in line with David Harvey’s notion of the “spatial fix” highlight its limitations as a lasting remedy to regional inequality. Harvey [10] argues that when capitalism faces an overaccumulation crisis, it resorts to spatial restructuring—relocating capital to new geographic areas, investing in infrastructure projects, or repurposing existing spaces—to resolve these crises.

4.2. Upgrading/Downgrading & Labour Agency

Gereffi [1] frames GVCs as processes where economic actors—countries, firms, and workers—transition from low-value to high-value activities within GPNs, identifying “economic upgrading and governance” as key pillars.

“Upgrading” in GNCS often overlooks regions and firms stuck in low-tier positions. Incentives like low wages, low taxes, and cost advantages are development strategies, but technological upgrading doesn’t always improve living conditions and wages. Capitalism’s global system necessitates regional disparities [36]. Evidence shows firms respond to labour protests by adopting spatial solutions [37], relocating production to less organised labour markets and reshaping spatial production dynamics.

Spatial fixes by global capital may lead to economic recovery but not necessarily social recovery. Workers’ rights and conditions may not improve, especially for women and migrant workers, who remain in flexible, vulnerable, precarious work. Low productivity, subcontracting, and buyer demands perpetuate poor conditions. Employment and wage progress often don’t extend to freedom of association [38].

Bair and Werner [6], drawing on critiques that posit social “downgrading” as equally plausible to “upgrading”, underscore that GPN analyses often adopt capital-centred narratives and that studies of labour’s role typically treat labour as an object of the process, judging it solely by firms’ performance within the chain. An alternative perspective, however, foregrounds labour as an agent within GPNs. In this vein, Selwyn’s [39] contention is invoked: the capacity of workers to convert structural power into organisational power—and thereby extract concessions from capital—constitutes a key determinant of the relationship between economic upgrading and social upgrading. Bair and Werner [6] distinguish themselves by highlighting the neglect of the evolving, structured hierarchies of the labour process and by arguing that the “social upgrading” of some worker groups can only be achieved, in part, through the “social downgrading” of others, thereby calling into question the explanatory scope of network models.

Our study interrogates the effects of GNCS by adopting a spatial and temporal lens on the historical trajectories of unionised metalworkers—and, more broadly, the working class of the SetPe. We demonstrate that the rupture of workers’ organisational power not only produces heightened vulnerability among fragile groups but also induces a generalised social downgrading, with the reproduction of space forming an integral part of this process.

Selwyn [7] draws a clear distinction between the “problem-solving” variant of GVC analysis—which attributes workers’ low wages not to exploitation but to low productivity or the value-capture strategies of lead firms—and the critical variant, which shows that employment often depends on poverty wages and physical exhaustion. He explicates the latter through the concept of the “Global Poverty Chain” (GPC) and employs the notion of “super-exploitation”.

The dominance of global capitalism over space necessitates the consideration of the concept of scale in GNCS analysis. Local actions reverberate across different spatial scales, shaping power dynamics for both workers and firms [27]. In this process, the uniqueness and historical context of the local position are also significant. Indeed, Murphy’s [40] study of Bolivia’s Wood Products Sector emphasizes the importance of small- and medium-sized firms, lower-tier suppliers, and essential production areas in low-income countries within GNCS. The study critiques analyses that focus solely on the central role of MNCs in network structures, showing how industries targeting a single network may weaken local alternative networks. This suggests that relationships across different layers cannot be explained solely through the actions and strategies of MNCs. In this context, the processes of space reproduction are shaped by the interaction between capital’s spatial strategies and the resistance strategies of labour and other local actors.

Recent work by Burawoy that integrates regimes of labour into the GNCS literature offers significant insights into the role of labour within global chains and networks. Approaches such as global labour history, critical geography, and world-systems analysis examine labour in its historical and spatial contexts, critiquing the “deep labour blindness” produced by privileging economic upgrading within GNCS [8,36].

4.3. Spatial Theories

Spatial transformations, marked by these processes, are often overlooked in social theory [10,11,30], obscuring patterns of geographical fluidity. Massey [11] emphasizes space as a dynamic construct shaped by relationships, where simultaneity and heterogeneity coexist, evolving through ongoing social processes.

Using Henri Lefebvre’s [9] concept of the reproduction of space, this study examines how deindustrialisation and the integration of GNCS reshape SetPe’s spatial dynamics. Viewing space as a social construct shaped by power relations and everyday practices, it highlights how the closure and relocation of industrial facilities left behind abandoned areas and spurred urban redevelopment. These changes eroded the social and cultural fabric of once-industrial zones, reflecting the interplay among economic policies, labour movements, and urban planning. Lefebvre’s framework thus offers a holistic lens for understanding spatial transformations in SetPe.

The article focuses on the dynamics of deindustrialisation and reindustrialisation in SetPe, analyzing the city’s transformation within a defined temporal context—particularly regarding labour processes and employment structures.

5. Urban and Labour Transformation: A Historical Trajectory

5.1. Industrial Consolidation and Worker Mobilisation (1960–1974)

The SetPe has been of critical importance for Portuguese industry since the late 19th century. The growth of the canning industry, the relocation of industries from Lisbon to the south bank of the Tagus as a result of the opening of the maritime terminal at Barreiro and the Sul e Sueste railway, and the region’s hosting of state-sponsored heavy industrial investments by large family-owned companies, notably CUF, from the 1960s onwards, made the SetPe one of the symbols of Portuguese industry until the mid-1990s [41]. The SetPe industry is a late industrialisation and development address for Portugal.

In the 1980s, industrial employment in SetPe was concentrated in Setúbal, Almada, Seixal, and Barreiro, accounting for 83% of the region’s industrial workforce. This was concentrated in four companies: Setenave (ship repair, 4903 workers), Siderurgia Nacional (steel, 4870), Lisnave (shipbuilding, 5330), and Quimigal (fertilisers, 6127) [16,42]. Three of these private companies, established with state support during the Estado Novo period, were part of the CUF family businesses until nationalised in the 1970s, while SN belonged to the Champalimaud group [16].

Santos [41] argues that SetPe (given its historical and material characteristics) represented the Portuguese working class, much like the cities of Turin or Detroit represented working-class history in Italy and the US. Between the 1950s and the early 1980s, this region experienced significant population growth, driven notably by a large workforce from rural Alentejo with strong traditions of solidarity and collectivism, which intensified labour struggles. According to Ferrão [43], the presence of this combative workforce posed an obstacle for many entrepreneurs, leading to the cessation, postponement, or cancellation of investments. This assessment aligns with Scott’s approach and Harvey’s concept of the “spatial fix”.

Having traced how pre-1974 industrial expansion galvanised labour activism, we now move into the next section, which begins with the brief revolutionary interlude triggered by the Carnation Revolution and then follows the longer arc of restructuring and state withdrawal that unfolded throughout the 1980s.

5.2. Revolutionary Restructuring and State Withdrawal (1974–1990)

Portugal’s accession to European institutions after the PREC period transformed the country’s political and economic structure. Under the IMF’s economic policies, post-revolutionary radical measures were rejected [20]. The rise of Prime Minister Aníbal Cavaco Silva in 1985 marked the beginning of greater access to the internal market, exposing Portugal to intense competitive pressures. However, Silva secured structural fund transfers, and by the late 1990s, EU funds accounted for 3.3% of GDP, leading to infrastructure projects. Privatisations of nationalised banks and industries occurred, and influential families from the dictatorship era returned. Portugal joined the EEC in January 1986, and key treaties like the Single European Act and Maastricht Treaty facilitated capital liberalisation and the creation of the European Central Bank [15,20].

A return to agrarian reform and expropriations was included in the 1989 constitutional reform. There was social resistance to the re-privatisation of land (in reality, most of it was returned to its former owners), especially of ‘collective production units’ [15].

The World Bank [28] prepared a report on non-financial public enterprises (NPEs), many of which were located in the SetPe. The report highlighted their financial struggles due to high investment costs, unpaid government debt, and rising energy prices. It recommended prioritizing efficiency, postponing large investments, and considering privatisation or divestment. Additionally, it predicted that Portugal’s small and open economy would shift toward less capital-intensive private sector activities to generate employment. While sectors like cement (Cimpor) and paper (Portucel) were expected to benefit, the steel sector (SN) was anticipated to face intense competition, and the gradual lifting of protective quotas for petroleum products, chemicals, and petrochemicals would expose these industries to competitive pressures.

The report overlooked the severe spatial consequences for regions where these capital-intensive enterprises, which employ large numbers of workers and are critical to the country’s infrastructure, are located. This decline was shaped by the expectations of global financial institutions and pushed Portugal into the lower tiers of value chains. This aligns with Harvey’s theory [10] that the geographic expansion of capitalism increases competition, leaving disadvantaged regions to bear the heaviest burdens.

Between 1989 and 1996, the government tried to attract MNCs in new technologies, electronics and telecommunications, and large car manufacturers. The industrial and commercial development that accompanied EEC membership was considered to have been successful, and the external debt problem was considered to have been overcome [15].

In contrast to the 1990s, Portugal found itself in a deep crisis in the 2000s, with the economy experiencing a long period of crisis and economic stagnation, including 0 real growth between 2001 and 2014 (

Table 2. Per Capita Gross Domestic Product (Portugal).

Period	Per Capita GDP (%)
1946–1973	+5.2
1974–1985	+2.0
1986–2000	+3.9
2001–2014	0.0
2015–2022	+2.3
Source: [45], 1986–2022 periods are calculated by authors from IMF [46]

). This had serious consequences in terms of unemployment and over-indebtedness of economic actors. Moreover, during the same period, in stark contrast to Portugal’s stagnation, many countries on all continents undertook major economic reforms and modernisation processes. Portugal was left behind at a time when many economies found their way to relative growth and ‘prosperity’ [44].

These data clearly reveal Portugal’s regression in the process of articulation into GNCS. In the vacuum created by post-revolutionary restructuring, the region entered a decisive period of de-industrialisation and global re-integration steered by world markets.

5.3. Deindustrialisation and Global Reintegration (1990–Present)

Deindustrialisation has significantly affected SetPe. In 1960, 45.9% of regional employment was in secondary sectors, with 54,473 workers. By 1981, this figure exceeded 100,000, but by 2021, the region lost 42,213 jobs in secondary sectors, with municipalities like Setúbal, Barreiro, Almada, and Seixal being the most impacted (Figure 3).

In the 1990s, the exporting production structure was concentrated in the northern regions, which relied heavily on traditional sectors, often labour-intensive and export-oriented. This is in line with the predictions of the World Bank report [28] from the early 1980s and the role it assigned to the Portuguese economy. For the secondary sector, it is stated that SetPe has left behind the crises of the late 1970s and early 80s and is an industrial area with strategically large enterprises in the manufacturing sector, which acts as a catalyst for foreign investment; however, important sectors are still in recession [48]. However, the 2000s deepened the crisis in the region. The deindustrialisation of SetPe is attributed to the articulation with the global market and the EU process. This macro-level transformation was not confined to production; we conclude the section by showing how social and economic collapse permeated everyday life in SetPe.

5.4. Social and Economic Decline Across the SetPe

This process has not been adequately responded to by new sectoral dynamics and has led to both economic and social decline, symbolised by the abandoned Quimigal industrial zone, especially in the municipality of Barreiro.

Barreiro’s growth model collapsed with deindustrialisation, as economically unsuitable industries left behind abandoned land [49]. CUF was nationalised as Quimigal after the 1974 Revolution, restructured in 1989, and privatised in 1997. After that, Quimigal inherited a 214-hectare brownfield site plagued by industrial decay. Regeneration efforts, led by Quimiparque, focused on attracting companies but overlooked key elements like risk management, financing, and environmental justice, neglecting connections between social, economic, and environmental needs. By 2003, the Master Plan revealed the project’s failure after 14 years [50].

Despite these shortcomings, under the Council of Ministers’ Decree 137/2008 of 12 September, the government launched the Arco Ribeirinho Sul Project in 2008 to redevelop disused industrial areas in Almada (Margueira complex), Seixal (SN), and Barreiro (Quimiparque), all located on the south bank of the Tagus estuary. However, Barreiro remains isolated by old industrial complexes, marked by minimal activity, abandoned land, and persistent pollution, forcing residents to seek employment elsewhere and limiting its ability to attract new residents [49]. Our field trips in the Barreiro area gave the impression of a ‘dead city’ with large abandoned industrial zones and empty residential areas. In Barreiro, a vibrant labour town with sports clubs, associations, and social activities, the closure of industrial plants has caused social problems. Many families did not want to leave the area; suicides were reported, and economic and social life was severely affected.

“Barreiro was a town full of activity, not sleep. Now, it is just a dormitory. Essentially, we run the risk of having a generation poorer than their parents. The most qualified younger generation is poorer. If the next generation is poorer and still qualified, this leads to only two paths: either emigrate to countries that recognise your value and pay you better. Or disappointment, frustration, inability to realise dreams, with all the consequences that entails” (Interview with Francisco Alves, currently a municipal councillor in Barreiro and a former union leader. Barreiro, 15 July 2023).

Carlos Humberto Carvalho (Interview with the former Mayor of Barreiro and currently the First Secretary of the Metropolitan Area of Lisbon (association of the 17 municipalities of the metropolitan region), Lisbon, 9 June 2023) describes the transformation process as dramatic, noting that deindustrialisation in the 1980s and 1990s merged with processes in Almada and Seixal. The city, with its industrial roots in the railway workshops (CP), faced a decline in both industry and labour culture. The loss of job opportunities led the older generation to stay, while youth sought work abroad, causing family breakdowns and an increase in suicides. Limited economic support could not compensate for the loss of employment, and social support remained restricted. People felt a loss of dignity, and the transformation of abandoned industrial areas remained a persistent issue. This aligns with Emery’s view [31] that industrial collapse was not just economic but a profound process affecting social structures, identities, and spatial organisation, evoking loss, mourning, and alienation.

In the SetPe, the issue of how to functionalise the ‘brownfields’ of abandoned industrial areas is still seen as an important problem area in our interviews. Municipalities have different approaches to these areas. The mayors of Seixal and Setúbal mentioned their efforts in this regard during our interviews.

Seixal, part of the SetPe, has hosted diverse industrial activities since the 19th century, leaving material traces of pre-industrialisation, industrialisation, and deindustrialisation. The establishment of the iron and steel giant Siderurgia Nacional (SN) in 1961 and the construction of the Tagus River bridge in 1966 spurred economic and demographic growth, reshaping the municipality [51]. However, the EEC process and subsequent SN privatisation—aligned with WB and EEC competition policies—led to downsizing, factory transformations, and workplace closures, resulting in severe social problems.

“The social, economic, and industrial impacts in the municipality of Seixal were significant. The main impact came from SN, where 7000 workers were employed. In 1990, with privatisation, this number dropped to around 400. There were redundancies, but mostly early retirements. Thousands of people retired at the age of 50. For those who had been working from an early age, it was too late to start a new job… Many people died early due to alcohol problems. What a tragedy those dark years were for our peninsula. Lisnave closed… Indelma in the 2000s… The car industry, which employed around 1000 people, closed its factory… In 2000, the peninsula suffered further losses with the closure and deindustrialisation. Today, in the Setúbal area, these effects have been mitigated” (Interview with Paulo Silva, Mayor of Seixal, 19 July 2023, Seixal).

In addition to social problems, there are also the pains of spatial transformation. In this sense, the Municipality of Seixal is following a different path and is addressing the re-industrialisation efforts together with technological processes.

“There are hundreds of hectares of land in Seixal. These are currently underutilised, and we think they should be allocated to industry. Therefore, unlike the municipalities of Almada and Barreiro. Unlike Barreiro, which thinks that the land belonging to Quimiparque and Lisnave should be used for housing (as well as new office spaces, shopping areas, and social areas), our goal is to create jobs in the municipality and create a strong industrial centre that will be very important, especially in terms of new technologies… We expect other companies in the technology sector to come here. This year, we launched a project to increase the training of young people in new technologies. This is the creative Seixal… It is no coincidence that Seixal is the fastest growing municipality in the Lisbon metropolitanarea”. (Interview with Paulo Silva, Mayor of Seixal, 19 July 2023, Seixal).

One of the most important sectors in the SetPe is shipbuilding. Lisnave, founded in 1961, and Setenave, founded in 1971, grew in a favourable international environment and were sites of labour struggles before and after the Carnation Revolution. Due to international competition and privatisations, these shipyards lost 10,636 workers between 1980 and 1994. Setenave was privatised in 1989, and in 2000, Lisnave’s shipyard in Almada was closed and moved to Setúbal [41]. Privatisation and workplace closures led to subcontracting and wage erosion, negatively affecting the region’s economic, cultural, and social life [52].

The shipyard space was seen not only as a world of economic production but also as an equally productive space of sociability and solidarity. In the Alentejo, there was a wide range of activities, from the establishment of consumer cooperatives to distribute the products of the cooperatives formed because of the agrarian reform, to the opening of nurseries, the creation of sports clubs, and the organisation of cultural and recreational activities [41]. In the 1970s, the shipyard space, which gave meaning and content to individual existences, political significance, and shared values, was replaced by individualisation and competition between workers.

Lisnave is today the fifth largest ship repair yard in the world, performing tanker cleaning, damage repairs, and major overhauls. There are two main reasons for its continued operations: its geographical location and poor working conditions with low wages. Subcontracted workers make up a significant portion of the workforce at Lisnave [52].

In our interviews, the inability to act collectively and to pass on past values to new generations is seen as one of the important effects of transformation.

“During and after the PREC, we built a labour sector. Cavaco Silva’s premier minister saw the disintegration of heavy metal labour. The shipbuilding industry and state labour sector were sold, leading to the destruction of workers’ living conditions and organisation. There was famine, unemployment, and workers not getting paid in Setúbal during the 80s and 90s. It was a tough period, and we tried to pass on these lessons to the next generation, though we may not have succeeded fully. We aimed to convey solidarity, union, and political commitment, because things are always changing”. (Interview with Francisco Alves, currently a municipal councilor in Barreiro and a former union leader. Barreiro, 15 July 2023).

Setúbal, the central municipality of SetPe, is historically known for its port and canning industry, which provided skilled labour for the metal sector, particularly welding. The city later specialised in the paper, chemicals, cement, automotive, and shipbuilding industries. In 1980, Renault opened a factory but closed it in 1998, relocating production to a lower-cost country [53]. Setúbal’s history reflects cycles of expropriations, privatisations, closures, and new investments. The 1980s brought deep economic crises, with mass unemployment and starvation remaining in collective memory.

Investment decisions of MNCs have always played an important role in the region. Renault, Alstom, etc. Nationalisation-privatisation practices (shipyard, paper industry) have led to sectors falling out of favour and closures.

“The impact of these companies here was very important; then they had to close down in the 70s, 80s. It was a matter of life… it was a crisis of unemployment…this was also the case in the shipbuilding industry at that time… The situation was so serious that the government asked for help from the European Union at that time and asked for an integrated operation to solve everything here. It helped in a way, but not completely, but at least it helped to create the organisation here”. (Interview with André Valente Martins, Mayor of Setúbal, 29 May 2023, Setúbal).

As a result, SetPe has experienced a major crisis in the process of articulation into GNCS. Increasing competitive pressures, the internationalised mission of Portugal, and the idea of the withdrawal of the public sector from the industry have led to the closure of large-scale firms, mostly heavy industries, in the iron and steel sector in Seixal, in the chemical sector in Barreiro, in the shipbuilding sector in Almada, and in the automotive, shipbuilding, and chemical sectors in Setúbal. There are three clear consequences of this situation. The first is economic decline, the second is cultural and social decline, and the third is the urban brownfields left behind.

This chronological-spatial perspective demonstrates how the restructuring of labour relations was mirrored in the urban fabric of the SetPe. The collapse of integrated industrial spaces created fragmented urban zones marked by underinvestment and population decline, while the emergence of global production enclaves offered limited reintegration into the urban core. These interlinked dynamics reflect the spatial fix of capital as well as the uneven territorial imprint of globalisation.

6. The Construction of the Global Factory as an Instrument of Development

Since 2010, the industrial sector has maintained its share of employment at the same level as the SetPe. This stabilisation has been achieved after a major economic downturn and structural adjustments. Ultimately, this system benefits tourism, real estate, and, to a lesser extent, some manufacturing activities. Within the manufacturing sector, the automotive sector has grown the most since 2010, both in terms of employment and gross value added, and is an exception to deindustrialisation [54].

The Portuguese economy, fully integrated into the global trading system, has an industrial sector dependent on imported inputs. This indicates a dependent structure of the Portuguese economy. Participation in GNCS is not considered sufficient for good economic performance; it seems to depend on the ability to include domestic value added in exports [55].

6.1. Revival of the Automotive Sector in SetPe

In this context, the AutoEurope (AE) project, launched in 1991 with more than €500 million in aid approved by the European Commission and the Portuguese government for Ford and VW, has played an important role in the SetPe. This investment aimed to rebuild the economic structure of a region that had long suffered from a production crisis. The Portuguese automotive sector experienced significant expansion, and the trade balance in the automotive industry improved as a result. Given the region’s militant labour profile, AE did not employ laid-off workers, instead focusing on young workers with no previous manufacturing experience, particularly those entering the labour market for the first time [56]. The workers we interviewed also confirmed this. “There are no jobs for us, and many of the workers from VW work here only for VW. They left school and started working. So they only know how to do it. Yes, maybe I can find a job outside. Yes, maybe. It’s my fault. I just assembled the steering wheels. What good will that do?” (Group interview with VW workers, SITESUL, Setúbal, 11 July 2023).

Interviews with mayors and trade union representatives in the region revealed that AE is vital for the region. However, what makes AE vital is not that the region is less industrialised but that it is a largely deindustrialised region.

The automotive sector is defined as fragile, and environmental regulations, along with technological developments, are affecting the GNCS and the situation of workers. The COVID process has further complicated this. The Portuguese automotive industry’s dependence on internal combustion engines, its peripheral position in Europe, and its entrapment in the low value-added segment are concerning. Wages remain under significant pressure. The future of the sector is often tied to its ability to attract foreign direct investment. After the decline of sectors like shipbuilding and chemicals in the SetPe, the automotive sector has gained prominence, but its production network lacks depth. Companies like VW operate with centralised decision-making, and SMEs face constraints in human and capital resources [54].

Having established how the automotive sector revitalised the region, we now examine the new dynamics this ‘global factory’ has introduced into labour conditions.

6.2. Labour Conditions of the SetPe

Despite Volkswagen Autoeuropa’s (AE) role in regional economic revival, our findings suggest that this has not translated into broader social upgrading. Many AE workers report economic insecurity, rising living costs, and job-related psychosocial stress. This aligns with Ben Selwyn’s [6] critique of the “problem-solving” variant of Global Value Chains (GVCs) literature. Rather than lifting workers out of poverty, employment in GVCs often depends on low-wage regimes, super-exploitation, and systemic exclusion from value capture, forming what Selwyn terms a “Global Poverty Chain” (GPC).

Our findings further support Bair and Werner’s [6] critique of the GVC “upgrading” narrative. While GVC literature often frames integration into global production as a pathway to economic development, we argue that “downgrading” and immiseration are equally plausible outcomes. The persistent dependency on foreign investment and the erosion of organised labour power in SetPe reveal a path-dependent structure of marginalisation.

VW workers told us that wages are eroding in the face of rising inflation and that while people used to queue to work at VW 20 years ago, working in the factory is increasingly unattractive. They pointed out that although their wages are relatively above the Portuguese average, they are in very serious distress due to the weight of industrial work, the intensification of work, increasing housing loans and bills, taxes, shift work, etc., and that they cannot make a living if their spouses do not work (Group interview with Volkswagen workers, SITESUL, Setúbal, 11 July 2023).

Hélder Pires (Member of the Permanent Secretariat of Fiequimetal, Fiequimetal Building, Lisbon, 18 July 2023) emphasises that AE is seen as an untouchable symbol for both the government and the region. Highlighting the company’s vital role in creating employment in the area, Pires notes that VW puts pressure on the workers by threatening to relocate the factory to places like Eastern Europe or Turkey. Despite the increased production speed due to the use of machines, workers are forced to keep up with the machines’ pace, leading to an increased workload. He explains that this situation has resulted in workplace accidents, occupational diseases, and psychological issues, with some workers even committing suicide. Pires also adds that the shift work system creates significant difficulties for family life and work-life balance, leading to many divorces.

Vale [56] points out that the AE project was a turning point in the Portuguese car industry under the influence of new production strategies and multinational subsidiaries. It has strengthened inter-firm cooperation and local learning processes, especially in less developed regions of Europe, through supplier networks established by the pooling of domestic and foreign capital. However, the high dependence of supplier firms on AE and asymmetric constraints on the diffusion of technological knowledge to lower levels pose risks of localisation of production and market integration, especially for local firms. Thus, we conclude that the dense network of suppliers supported by foreign capital may not be a positive factor in the regional development of peripheral regions in the context of asymmetric power relations in such a local network.

Our research on SetPe shows that nearly three-quarters of workers cannot afford an additional expense equivalent to the minimum wage (750 euros). Additionally, 41.5% cannot afford a week’s holiday, and 29% cannot buy meat or fish at least twice a week. A significant 88% of workers feel their wages are insufficient. Only 8% are renters, while 72% own their homes, though three-quarters of these are mortgaged. Workers in AE earn higher wages but still struggle to meet their needs due to the cost of living and other economic pressures [12]. Supporting this, more than three-quarters of the respondents (71.6%) reported earning between €1000 and €1500 per month (Figure 4).

After outlining the tensions within the labour experience, we focus next on how this fragility reverberates through the region’s broader economic balances.

6.3. Economic Decline of the SetPe

During this process, SetPe’s decline has been not only social but also economic, as clearly evidenced by statistical data. In 2000, SetPe’s GDP per capita was equivalent to 68 per cent of the EU average, but it deteriorated further, especially during recessionary periods, falling to 55 per cent of the EU average in 2015, which corresponds to a 13-percentage-point decline. This shows that the region significantly diverges from the EU in terms of economic development indicators [57].

According to our calculations based on data from Portugal’s National Statistics Institute, SetPe has experienced a significant decline not only compared to EU countries but also compared to the Portuguese economy in recession (Figure 5).

SetPe is among the regions with the lowest per capita income in Portugal. In 1996, it was ranked 16th among the 36 NUTS III regions, but by 2012, its ranking had declined to 28th [58]. The EU does not provide more up-to-date data on SetPe due to data collection arrangements related to statistical regions. In conclusion, the region’s decline is tragic.

7. Results

This article examines the economic, social, and spatial consequences of SetPe integration into GNCS. Historically, SetPe held a pivotal position in Portuguese industry through capital-intensive sectors such as chemicals, metals, paper, shipbuilding, and—since the 1990s—automotive production. Although the political turmoil of the 1970s and the oil crisis rattled the region, industrial expansion persisted until the late 1980s.

During the country’s accession to the European Union, restructuring policies classified large-scale plants in shipbuilding and repair, heavy-metal processing, and fertilizer chemistry as “inefficient”. This re-designation precipitated widespread factory closures, mass layoffs, wage arrears, and chronic under-capitalisation, deepening SetPe’s dependence on Lisbon. The ensuing shock unleashed a severe wave of de-industrialisation, consolidated multinational dominance, and fragmented the region’s social and cultural fabric.

GNCS integration further tethered the region to the investment decisions of global corporations and left a landscape pocked with abandoned industrial sites. Downward mobility became as likely as upward mobility; since the 2000s, small- and medium-sized manufacturing cities across Europe have experienced losses in employment and relative income, whereas major metropolitan areas have led in job and income growth [59]. Because SetPe lies within the Lisbon metropolitan boundary, its decline is obscured in aggregate statistics; nonetheless, data presented here show a widening income gap between Lisbon and SetPe.

While the “global factory” model, exemplified by Autoeuropa, has helped stabilize employment in SetPe, it has also introduced significant vulnerabilities. Subcontracted workers face intensified workloads and limited protections, while occupational illnesses and mental health concerns have been reported by union representatives. Additionally, the heavy reliance on multinational capital leads to a fragile employment structure sensitive to relocation threats. Environmental consequences are also notable, as deindustrialised zones often lack comprehensive remediation and continue to pose risks to public health, as seen in the Quimiparque brownfield site.

The closure of factories and the relocation of industrial activity have left significant spatial voids across the SetPe. Interviewees described entire neighbourhoods—particularly in Barreiro and Almada—as “dormitory zones”, marked by depopulation, declining services, and abandoned buildings. These urban effects are directly tied to labour restructuring, as workers either emigrated or now commute long distances to employment enclaves.

8. Discussion

This discussion addresses the two core research questions posed in the introduction:

(1) How have de-industrialisation and the integration of GNCS reshaped the economic, social, and spatial structure of SetPe, and (2) what do these transformations mean for labour conditions and working-class life?

Our findings indicate that the resilient stance of SetPe’s working class was used by capital as a pretext for the withdrawal of industry from the region. This outcome dovetails with Harvey’s concept of the spatial fix and Silver’s analysis of capital relocation in response to labour resistance [10,37]. Instead of mitigating local inequalities, spatial restructuring has deepened them. The balance of power between capital and labour was resolved in favour of capital through policies that prioritised the attraction of multinational firms—thereby depressing wages and eroding living standards. Abandoned factories, vacant houses, and a lost culture of solidarity now mark the urban landscape.

De-industrialisation is not merely an economic process; it also entails spatial fragmentation, collective memory, and processes of loss [31]. The central dilemma in the relationship between GNCS and space is the dependence on leading firms’ investment decisions and their tenuous connection to the local context. Such a configuration not only excludes local workers from decision-making but can also threaten alternative local networks [40].

According to Rodríguez-Pose, growth models centred on large metropolitan areas exacerbate regional inequality and render declining regions increasingly dependent on misguided investments, income-support transfers, and state aid [60]. Development policies must therefore combine people-based and place-based approaches, empowering local actors and strengthening local capacity for sustainable growth. Cities should not be forced to choose between efficiency and equity.

The SetPe case demonstrates that policies ignoring the local context intensify inequalities. Top-down strategies that fail to prioritise local needs prove ineffective, whereas place-based approaches that mobilize local potential and dynamics yield more inclusive and enduring solutions. These findings confirm Rodríguez-Pose’s argument that local development strategies are crucial for breaking cycles of regional dependency [60]. However, the question of which actors will drive this process remains unresolved. As Selwyn [39] emphasizes, labour must convert structural power into organisational power to secure concessions from capital.

Understanding the spatial effects of GNCS requires close attention to the decision-making mechanisms of multinational corporations and the architecture of global production networks. When the interplay between economic and social processes is neglected, local democracy becomes ineffectual. The role of organised labour in shaping the geography of GNCS cannot be ignored [6]. Production is structured not only by global capital dynamics but also by labour–politics relations at local, regional, and national scales [27]. This article is inspired by Öngel’s study (Appendix A), which examines the transformation of Kocaeli-Gebze—an important production center near Istanbul—through its inte-gration into global value chains, particularly in the automotive supply industry.

A key limitation of our qualitative strand is that it relies mainly on high-level informants—mayors and union leaders—so the everyday experiences of non-unionised workers, women, young people, and unemployed residents are captured only indirectly. Future research using community-based participatory methods or ethnographic fieldwork could complement this top-tier perspective and yield a more granular understanding of post-industrial life in SetPe. As Figure 3 and our Quimiparque discussion (Section 5.4) illustrate, heavy-industry brownfields are tightly clustered along the Tagus waterfront, whereas new manufacturing capacity has coalesced around Palmela and Autoeuropa (Section 6.1). This split between derelict cores and a peripheral production enclave underlines how economic restructuring and the reproduction of urban space are mutually constitutive [47,50,54]. Massey’s multi-scalar relational conception of space likewise points to social dimensions—such as gender and ethnicity—that lie beyond the scope of our present analysis [11].

A labour-geography perspective [61] further reveals that GNCS transform not only economies but also the spatial distribution and social reproduction of labour. In SetPe, the weakening of union power and the shift from secure public employment to precarious work have fragmented the social fabric and diminished labour’s spatial agency. While the spatial fixes of GNCS facilitate capital mobility and infrastructure renewal, they frequently fail to repair the embedded social and economic damage.

Accordingly, a critical, multi-scalar analysis of GNCS that foregrounds labour, space, and power relations is indispensable. By extending the GNCS framework to centre localised labour struggles, this study offers a more holistic understanding of how global capitalism reshapes urban and industrial peripheries.

Future research would profit from incorporating visual and documentary methods (e.g., photographic and cartographic analyses of post-industrial sites such as Quimiparque, the Barreiro waterfront, and Seixal’s industrial belt). Such materials would provide concrete evidence for public-policy debates and urban-planning processes.

These dynamics are not unique to SetPe. Similar patterns of industrial relocation and uneven regional development have been observed in Silesia (Poland), the Ruhr (Germany), and northern England. Whereas robust regional planning has cushioned social costs in some of these areas, SetPe exposes the risks of fragmented governance and excessive reliance on multinational capital. Our findings, therefore, reinforce the case for place-based development strategies that empower local stakeholders, invest in social infrastructure, and diversify economic bases beyond enclave industries.

Ultimately, the material restructuring of labour relations has transformed not only social life but also urban morphology. The unravelling of spatially embedded industrial systems has weakened local economies and fragmented community geographies. In contrast to integrated industrial cities—where work, housing, and services once formed cohesive urban units—SetPe now reflects the spatial logic of disarticulated GNCS.

9. Conclusions

The SetPe example provides a valuable case study for analyzing the interactions between global and local dynamics. Our findings are consistent with urban governance studies, which demonstrate that local actors possess limited influence over capital mobility and multinational investment decisions [61]. This confirms the vulnerabilities inherent in neoliberal urban governance, which is shaped by the spatial strategies of firms operating within global networks of cities. The transformations observed in SetPe underscore not only economic but also social and cultural vulnerabilities. Therefore, it is essential to develop policies that enhance resilience to the temporality of capital and strengthen local connections, thereby promoting a more sustainable and equitable future.

Nevertheless, building on the theoretical and empirical analysis, it is clear that generalised integration into GNCS is insufficient to reverse the long-term socio-spatial consequences of deindustrialisation. To move toward sustainable and equitable urban redevelopment in SetPe, we propose a set of concrete, multi-level policy recommendations:

(i) Public–Private Partnerships for Industrial Heritage Regeneration

Inspired by the transformation of the Ruhr region in Germany, local and regional governments could implement integrated redevelopment frameworks involving public infrastructure investment, private-sector participation, and cultural heritage institutions [62],. Projects like Zollverein Park in Essen demonstrate the potential of repurposing industrial ruins into cultural, educational, and tourism hubs while preserving labour history.

(ii) Mixed-Use Development Anchored in Social Economy Models

We propose exploring mixed-use land redevelopment plans where disused brown fields are partially transferred or co-managed by worker cooperatives or social enterprises, potentially through land trusts. This would combine affordable housing, green spaces, SME incubators, and community services while maintaining inclusive governance rooted in former labour communities.

(iii) Territorial Industrial Policy Instruments

Participatory and democratic planning processes should be adopted, ensuring the active involvement of local stakeholders (workers, cooperatives, local SMEs) rather than top-down approaches. Production and employment policies tailored to regional needs should be developed, restructuring decision-making processes to strengthen local democracy. Public entrepreneurship prioritizing social outcomes over profitability should be promoted through community-supported production facilities and service centers with high social benefits. These facilities should be designed to support regional economic sustainability, create employment, and reduce social inequalities. By reinforcing regional production networks through cooperatives, inter-union collabouration, and clustering policies, local economic dependence on global value chains should be reduced. Additionally, prioritizing local products and services in public procurement processes would localize economic cycles.

(iv) Municipal-Led Land Banking and Brownfield Mapping

To overcome fragmentation and speculation, municipalities should establish public land banks to acquire, consolidate, and repurpose underutilised industrial lands. Integrated with GIS-based brownfield mapping, these tools enable transparent prioritisation and community participation in planning processes.

(v) Institutional Memory and Labour History Preservation

We recommend launching a “Setúbal Labour Heritage Network” in collabouration with unions, universities, and cultural bodies to preserve and reinterpret the industrial and labour history of the region. This effort could support identity, tourism, and education while enhancing place-based development narratives.

In conclusion, revitalizing disused industrial areas in SetPe requires a coordinated, multi-actor governance model that combines infrastructure investment, social economy innovation, and territorial solidarity. Without such strategic approaches, the region risks remaining trapped in a cycle of spatial stagnation and historical erasure.

Moreover, future research should aim to incorporate more bottom-up perspectives alongside organised labour, especially the everyday experiences and resistance strategies of groups such as women and young workers, the unemployed, local communities, refugees, and environmental activists, which are crucial for developing a more comprehensive and inclusive understanding of the socio-spatial impacts of GNCS.

These findings have implications beyond SetPe. Unlike regions where strong regional planning has cushioned the social costs, SetPe illustrates the risks of fragmented governance and overreliance on multinational capital. From a policy perspective, these findings support the case for place-based development strategies that empower local actors, invest in social infrastructure, and diversify economic bases beyond enclave industries.