Industry: a conquest that promises to be difficult – Economics



“This is the first time the industry has been on the agenda of a presidential election,” welcomes Eric Trappier, CEO of Dassault Aviation and president of the influential steel federation UIMM. With the Covid epidemic, reindustrialization has become a matter of sovereignty, especially since the outbreak of conflict in Ukraine.” In 2020, shortages of masks, respirators and even paracetamol have left people stunned. Sanofi’s failure to develop an anti-virus vaccine came as a shock in Louis Pasteur’s homeland. It was a marker of the collapse of the industry as a whole.

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Its share of GDP has fallen from 17% in 2000 to 13% in 2020, even if INSEE detects a modest post-COVID growth of 13.58% in 2021. France becomes the most deindustrialized country in the G7. “For thirty years, France has lost more than a million industrial jobs,” lamented Denis Ferrand, director of the Rexecode Institute. This fall mechanically causes massive job destruction because, as former L’Oréal boss François Dahl argued, “Industry doesn’t create jobs directly, it creates wealth that creates a lot of service jobs.” Another harmful effect is the drop in exports, as evidenced by the catastrophic trade deficit in 2021 (almost 85 billion euros).

The problem of skills

At the end of long months of imprisonment, Emmanuel Macron moves from the cantor of the “startup nation” and the delimitation of the state to the return of the pilot state and “economic sovereignty”. The bar is being raised from the autumn of 2020 by lowering corporate tax and, above all, by reducing taxes on production by 10 billion euros (taxes on land or turnover, which are more important for industry than for services). Many presidential candidates are following in his footsteps to restore business competitiveness: Valerie Pecresse (15 billion euros), Eric Zemmour (30 billion) and Marine Le Pen (10 billion). On the left, Anne Hidalgo proposes the status quo, while Jean-Luc Mélenchon and Yannick Jadot oppose the already adopted cuts. The postponement of the retirement age after 62, also desired by the industrialists, is the subject of the same division between left and right.

Re-industrialization does not mean the reconstruction of the metallurgical plant on the Place de la Concorde, but robotization, digitization and electrification.

On the other hand, the issue of skills seems to have a consensus, at least in words. “The industry has become highly specialized, so it requires a very high level of skills,” notes Denis Ferrand. “The education system should be reoriented towards fundamental knowledge of mathematics and contribute to the development of a scientific culture at school, it is necessary to revive the attractiveness of industrial professions,” says Eric Trappier. Basic research businesses and organizations are also encouraged to come together to increase investment in research and development, which is stagnating at too low a level (2.2% of GDP) to secure the future.

“Reindustrialization is not the re-creation of a steel plant on the Place de la Concorde, but robotization, digitization and electrification,” emphasizes Christian Saint-Étienne, professor of industrial economics at the National Conservatory of Arts and Crafts. This requires a much more aggressive energy policy than just building six EPRs. This applies to gas-fired power plants, which currently emit little CO2, and photovoltaics, which are much better received in France than wind power.”

Landivisio gas power plant will be put into operation on March 31, 2022. (Photo by Nicolas Creach)

Pressure on industry tycoons

What remains is the political will to oppose factory closures and social plans. During the last vows of his five-year term at Bercy, Bruno Le Maire surprised by very sternly pointing out the responsibility of everyone in real industrial desertion: “In France more than in other countries, large companies that do quite well will systematically produce abroad in order to earn one euro cent per piece. These captains of industry must understand that this is a failed model! »

The Minister’s warning shot, which has not yet been heard. This is the case at the Fonderie de Bretagne in Codan (56). “Renault, which wanted to move its production to Turkey, wanted to close the site, which, however, was upgraded in 2020, is profitable and produces cast iron parts for electric vehicles, the future car,” complains a local elected official. The group ran into authorities who forced it to find a buyer. A year later, negotiations are still ongoing, but Renault is in no hurry to agree on a cost plan with potential buyers. After the election, the disassembly continues.

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