Europe’s Language Services in Decline: How AI Redefines Translation & Interpretation

Recent data indicates a clear decline in revenue and employment across the European translation and interpretation sector, pointing to major structural changes. Growing adoption of AI-driven language tools, shifting client expectations, and stronger competition are reshaping the market.

Translation and Interpretation Industry in Europe: Structural Overview and Emerging Trends

In recent years, the translation and interpretation sector has undergone a profound transformation driven by rapid technological progress. The rise of artificial intelligence and large language models has made multilingual communication more accessible than ever before, allowing individuals and businesses to translate text, generate content, and interact across languages without necessarily relying on traditional translation agencies. Thanks to real-time machine translation tools, automated subtitling, and AI-powered communication platforms, many routine translation tasks have become faster, cheaper, and more widely available.

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This technological shift has reshaped market dynamics: while demand for high-quality, specialized, and context-sensitive translation remains strong, the commoditization of basic translation services has increased price pressure and intensified competition. As a result, the sector today faces both opportunities and challenges, balancing innovation with the need to maintain linguistic accuracy, cultural nuance, and professional expertise.

For this analysis, we examined the European translation and interpretation sector across a broad set of countries. The NACE Rev.2 code 7430 – Translation and Interpretation Activities was used for the following countries: Albania, Andorra, Bulgaria, Cyprus, Greece, Hungary, Ireland, Kosovo, North Macedonia, Romania, and Spain. In addition, equivalent national activity codes from local business classifications were applied for Belgium, Croatia, Czech Republic, Denmark, Finland, France, Italy, Liechtenstein, Luxembourg, Monaco, Netherlands, Norway, Poland, Portugal, Russian Federation, San Marino, Slovakia, Slovenia, Sweden, Switzerland, and the United Kingdom.

While this dataset provides a nearly complete view of the European market, certain major economies (most notably Germany and Austria) - could not be included due unavailability of local classifications. Nevertheless, the wide geographical coverage ensures a robust representation of market trends across Europe.

Market-Level Overview: Revenue and Employment Trends

At the aggregate level, across all analyzed countries, the total revenue of the translation and interpretation sector (excluding sole proprietors) declined from €6.30 billion in 2022 to €5.62 billion in 2024, representing an 11% decrease. The total number of employees also fell, decreasing from 86,965 to 83,009, which corresponds to a 5% decline. This indicates that the sector not only experienced reduced financial performance but also a measurable contraction in its workforce.

Revenue Trends

• Total sector revenue decreased by 11%, showing an overall contraction in the industry.
  
• Top 30 companies saw a sharp revenue decline (-37%), indicating a significant loss of market dominance.
  
• In contrast, the remaining companies grew by 7%, meaning small and mid-sized firms gained market share despite the shrinking sector.
  

Employment Trends

• Overall employment decreased by 5%, marking a measurable reduction in workforce size.
  
• The Top 30 companies experienced a 44% drop in employees, showing extensive restructuring, automation adoption, or downsizing.
  
• Employment in the remaining companies increased by 3%, confirming a shift toward a more distributed workforce across SMEs and independent providers.

This downward trend suggests that the industry continues to face challenges related to pricing pressure, increasing automation (particularly AI-powered translation tools), and heightened competition. Unlike in previous years, the sector was not able to maintain employment stability, reflecting a more profound structural adjustment. The reduction in workforce size may indicate downsizing, efficiency optimization, or the migration of smaller market players out of the industry.

If we look at the largest players in this industry, the top 30 companies by revenue in 2024 generated a combined €1.59 billion, representing 28% of the total market in the analyzed countries. These companies employed 7,446 people, accounting for 9% of the sector’s total workforce.

In comparison, in 2022, the top 30 companies were significantly more dominant: they generated €2.53 billion, which corresponded to 40% of total market revenue, and employed 13,294 people, representing 15% of all employees in the sector.

This shift reveals two clear trends:

• Market deconcentration in revenue: The share of revenue held by the largest companies declined sharply from 40% to 28%, indicating that smaller and mid-sized firms have gained relative market share, despite overall revenue decline in the sector.
• Reduced employment concentration: The share of employees working for the top 30 firms fell from 15% to 9%. This suggests that employment has become more dispersed across the ecosystem, with SMEs and independent providers absorbing a larger portion of the workforce.

Together, these indicators show a structural transition toward a more diversified market. While leading companies remain technologically strong and influential, the sector’s employment base has become more widely distributed, and revenue is less concentrated among the largest players.

Distribution of Companies by Country

The table below presents the distribution of companies operating in the translation and interpretation industry across European countries in 2022 and 2024 without sole proprietorship, as well as the percentage change over this period. The data reveal significant variation in market size and dynamics between countries.

The distribution of companies across the translation and interpretation sector in Europe shows a varied and dynamic landscape, with countries experiencing growth, stability, or contraction between 2022 and 2024. Several markets recorded strong expansion. The most notable increase occurred in Montenegro, where the number of companies rose by 176%, indicating a rapidly developing service industry and growing demand for language services. Significant growth was also observed in Ireland (+58%), North Macedonia (+57%), Andorra (+50%), Cyprus (+43%), and Bosnia and Herzegovina (+38%), suggesting that these countries may be benefiting from an expanding digital economy, increased international cooperation, and the rise of remote language services. Other countries that showed solid growth include France, Finland, Portugal, and Slovakia, each growing by around 8–10%, along with Belgium, Norway, the Netherlands, Spain, and the Czech Republic, which registered more moderate increases of 1–5%.

Some markets remained stable, with almost no change in the number of operating companies. Albania, Kosovo, Romania, Sweden, and Monaco showed little to no variation between 2022 and 2024, indicating steady demand and consistent market structure without significant expansion or consolidation.

At the same time, several countries experienced a decline in the number of translation and interpretation companies. The largest decrease was recorded in Greenland (–50%), followed by Luxembourg (–17%), Liechtenstein (–17%), Hungary (–14%), and the Russian Federation (–12%). Declines were also observed in Italy (–8%), Poland (–8%), Croatia (–6%), and Denmark (–4%). These decreases may reflect market consolidation, increased competitive pressure from larger multinational providers, the impact of automation, or broader macroeconomic challenges.

Overall, the geographic distribution of companies indicates that while certain regions—especially parts of Southern and Eastern Europe—are experiencing rapid development, others are undergoing contraction or maintaining existing levels without significant change. This uneven evolution highlights how local economic conditions, digitalization trends, and industry maturity influence the structure and growth of the translation and interpretation sector across Europe.

The total number of companies changed from 22,805 in 2022 to 23,033 in 2024, representing an overall increase of 1%. This slight growth shows that, despite rising automation and the growing role of AI-based translation tools, the translation and interpretation industry in Europe continues to expand moderately. The steady number of new business registrations suggests that demand for human language expertise and localized services remains resilient, highlighting the sector’s adaptability in a changing technological environment.

Leading Companies in the Translation and Interpretation Sector

Analyzing companies in this industry provides valuable insights into how demand for language services varies across European countries, which types of firms dominate the market, what regional differences exist, and what challenges small and medium-sized enterprises face in this specialized field. This perspective helps to better understand not only the state of the industry itself but also broader trends in the language economy and the digitalization of services across Europe.

The table below presents selected leading companies in the European translation and interpretation industry, showing their revenues and employment figures for 2022 and 2024, along with percentage changes over this period. These firms represent some of the largest and most influential players in the language services market, operating internationally and setting benchmarks for performance and technological innovation in the sector.

Among the leading companies, STAR7 S.p.A. (Italy) recorded the strongest expansion, with revenues rising by 43.9% and employment growing by 29.1% between 2022 and 2024. This significant increase highlights the company’s successful strategy of combining language services with content engineering, digital solutions, and multilingual documentation, strengthening its role as one of Europe’s most dynamic language service providers.

RWS Translations Limited (United Kingdom), a globally recognized industry leader, maintained stable revenues (+0.2%) during the same period, though its workforce decreased by 12.8%. This pattern suggests continued efficiency improvements, integration of AI-assisted translation tools, and optimization of internal processes in response to technological transformation.

thebigword Interpreting Services Limited, also based in the United Kingdom, achieved a 10.6% revenue increase despite a 39.6% reduction in staff. The data indicate a strong focus on automation, cloud-based interpreting platforms, and outsourcing models that allow for higher productivity with fewer full-time employees.

Overall, the performance of the largest translation and interpretation firms highlights several defining trends in the European market. Even as total sector revenue has declined, leading companies have continued to grow, demonstrating a strong ability to adapt to technological change and shifting market dynamics. These top players increasingly rely on digital tools, AI-powered translation systems, automation, and remote service delivery to enhance efficiency, scale operations, and maintain competitiveness.

This technological edge has allowed major firms to optimize their workforces and restructure operations without sacrificing growth. At the same time, many smaller companies have struggled to keep pace with rising technological demands and price pressure. As a result, the market is undergoing gradual consolidation, with competitive advantage shifting toward providers capable of combining linguistic expertise with advanced technological and operational capabilities.

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