Labor laws

Today's Washington Post discusses Southern Europe's lack of growth. I think this part gets at the heart of it:

With 30 employees, [Paolo] Constantini’s is considered one of the larger companies in the region, and he has focused on high-end exports — designing shorter chairs for Japanese clients, for example, and slightly wider ones for the United States.

But he has avoided aggressive growth. Labor rules in Italy, he said, make every entrepreneur cautious about hiring. Employment in the country is “like marriage,” he said. Employment laws make it costly and time-consuming to eliminate workers, with unions allowed to determine who gets laid off.

Amidst all of the macro talk, this kind of stuff isn't receiving the attention it deserves.