Industry policy is an important means for the state to optimize the allocation of resources and adjust the industrial structure. It is of great practical significance to research industry policy on strategic adjustment of enterprises in recession. Using the M&A events of A share listed companies from 2013 to 2018 as samples, this paper empirically examines the impact, mechanism and economic consequences of industry policies on M&A decisions of enterprises in recession. The empirical results show that: Firstly, the enterprises in recession are more inclined to merge the enterprises that are supported by industry policies; this phenomenon is more obvious when the industry itself is not supported by industry policies. Secondly, from the perspective of mechanism, industry policy has “resource effect”, that is, when the degree of financial constraint of enterprises in recession is greater, the preference of M&A to industries supported by industry policy is more obvious. At the same time, compared with state owned enterprises, the incremental resources brought by industry policy mainly affect private enterprises. Thirdly, M&A by enterprises in recession to industries supported by industry policies can improve its performance.