Nicolas Dufourcq has been Chief Executive Officer of Banque Publique d’Investissement (Bpifrance) since 2013. After graduating from HEC and ENA, he joined the French Ministry of Economy and Finance, then the Ministry of Health and Social Affairs. He then joined the corporate world with France Telecom and Capgemini. Here, he gives us a multi-voice account of the deindustrialization phenomenon that affected France between 1995 and 2015.
As head of Bpifrance, France’s flagship reindustrialization support institution, Nicolas Dufourcq wanted to gain a better understanding of French deindustrialization and its causes, so as to tackle this new French chapter with full knowledge of the facts.
To do so, he gathered and synthethised 47 interviews with businessmen (and one businesswoman) from all sectors, focusing on SMEs rather than large groups, economists, trade union officials, bankers and politicians who lived through these “dark years”. From these interviews, he summarizes the causes of this failure, the changes that have taken place since, and the road ahead for the French reindustrialization project.
On the threshold of globalization, France’s industrial sector needed to be modernized and supported. Testimonies tell of business leaders who do not learn English, who do not believe in globalization, who do not seek to diversify their sales abroad. Beyond the personal choices made by entrepreneurs, the climate is described as defeatist. At a time when Germany and its international competitors were stepping up to the plate with interventionist policies, France’s leaders were not following suit. Fantasizing about a fabless economy, they were directing young people towards general education to the detriment of technical one. This rejection of industrial policy was compounded by a decline in subsidies, and an increase in labor costs, social charges and administrative obligations.
The result is a poisonous climate, with companies that are too far behind to maintain their position, and to undertake the transformations required to do so. Some have adequately transformed: many of the business leaders we interviewed are from these companies. Others have seen their companies fail, either because they were forced to do so – a phenomenon accelerated by inheritance tax in particular – or because it was the easiest solution. Indeed, in his interview, the CGT representative recounts how one willingness to transform a company avoided the relocation initially planned, thus underlining the lack of reforming will in others companies. Market liberalization has hit the French industrial sector hard, and the country has allowed its industry to become financialized, in contrast to Germany, which has managed to maintain a well-established family capitalism structuring its territory.
One of the most striking features of the interview panel was the absence of concessions and compromises. Employers concede that some of their colleagues did not behave properly towards workers and unions, trade unionists acknowledge that there was a culture of confrontation, and politicians, civil servants and others admit that the choices they made were wrong. Responsibility for the defeat was collective, just as it was for Germany’s victory. And it is also recognized that German success came at the price of the precarization of 5 million workers through the liberalization of the labor market before Angela Merkel’s introduction of the minimum wage.
Finally, the book is peppered with numerous observations pointing to a revival of French industry and to paths for improvement. The verdict is unanimous on the improvement of the tax environment for small and medium-sized industry, the usefulness of the apprenticeship reform and the – still timid – return of economic patriotism. Many companies have set up their own schools to meet their recruitment needs, and of which the social climate has greatly improved since the arrival of the current CEO. A trade union representative points out that often where the social climate is conflictual, courageous decisions had not been taken in the past, and this is illustrated by one boss saying that since he had taken over the plant, there had been no more strikes, whereas they were commonplace under his predecessor. The feedback from these testimonials is the need for esprit de corps/team spirit, between politicians, companies, workers and the administration.
So, while SMEs and ETIs are little in the limelight, this book gives them a voice first. It is already a step forward, given the distance between political Paris and the industrial territories, to use their testimonies as a starting point for moving forward.
Camille Ramecourt, CEC/Paris Dauphine-PSL intern research fellow.
Dufourcq, N., La désindustrialisation de la France 1995-2015, Ed. Odile Jacob, 01/06/2022, Collection Economie, pp.384.